§ 2318 Agent Authority Limits

This law says that a person acting for someone else can do things as allowed by their role, unless the person they work for specifically took away that power, but only people who know about the limit can't rely on that authority.

Key Takeaways

•An agent can act with authority unless the principal specifically removes it.
•The restriction only matters for people who actually know about it.
•If someone knows the authority is limited, they can't later claim the agent had full power.

Example

A store manager lets a clerk sign sales contracts. The manager didn't tell the clerk he can't sign deals over $10,000, but the customer knew the manager had said the clerk wasn't allowed to sign big deals.

Because the customer knew about the restriction, they can't later claim the clerk had authority to sign the contract. The clerk's authority is only valid for people who didn't know about the limit.

Every agent has actually such authority as is defined by this Title, unless specially deprived thereof by his principal, and has even then such authority ostensibly, except as to persons who have actual or constructive notice of the restriction upon his authority. (Enacted 1872.)

Key Takeaways

•An agent can act with authority unless the principal specifically removes it.
•The restriction only matters for people who actually know about it.
•If someone knows the authority is limited, they can't later claim the agent had full power.

Example

Because the customer knew about the restriction, they can't later claim the clerk had authority to sign the contract. The clerk's authority is only valid for people who didn't know about the limit.

Key Takeaways

Example

Key Terms

References

§ 2318 Agent Authority Limits

Key Takeaways

Example

Key Terms

References

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References