Question

Maggie Greene is a purchasing agent for Widget Exchange Corporation. Daryl Dixon, a Widget corporate officer, gives Maggie written authority to buy for the firm as many computers and peripheral devices as necessary. The next day, Daryl calls Maggie and tells her to buy only fifty note­book computers and nothing else. Maggie shows the written authority to ABC Products, Inc., and enters into a contract with ABC Products to buy sixty note­book computers and a selection of printers, scanners, and extra storage media. ABC Products ships the order to Widget. Discuss the principles of agency and authority as it pertains to agency. Does Maggie have authority to conduct business on behalf of Widget? If so, what type of authority does she have?

Answer 1

Q) Maggie Greene is a purchasing agent for Widget Exchange Corporation. Daryl Dixon, a Widget corporate officer, gives Maggie written authority to buy for the firm as many computers and peripheral devices as necessary. The next day, Daryl calls Maggie and tells her to buy only fifty note­book computers and nothing else. Maggie shows the written authority to ABC Products, Inc., and enters into a contract with ABC Products to buy sixty note­book computers and a selection of printers, scanners, and extra storage media. ABC Products ships the order to Widget. Discuss the principles of agency and authority as it pertains to the agency. Does Maggie have the authority to conduct business on behalf of the Widget? If so, what type of authority does she have?

ANSWER:

An agency relationship can be said as a guardian relationship where one individual who is additionally called as the "principal" approves an operator to follow up for their sake. The specialist is dependent upon the chief's control and should agree to their directions. This could be both in oral or composed structure. Office connections can likewise rise up out of circumstances even without an immediate understanding. The specialist has two kinds of power first real and second is evident.

Actual authority:

• This authority emerges when a specialist makes a move for the benefit of the principal. Like an individual buying a land property in the interest of another person.

Apparent Authority:

• This power exists when the specialist takes activities for the benefit of the head with an outsider that the outsider reasonably feels that the operator has the position to settle on a choice in the interest of the standard.

She has the power to purchase materials for the business as obviously expressed. She has an Apparent authority as she purchases sixty notepads rather than fifty. Here the dealer accepts that Maggie has the obvious right in the interest of the rule to make such buy. Here the seller sensibly accepts dependent on the chief lead that Maggie has the power to buy in excess of fifty notepads for the principal's benefit.