ACCA Applied Skills · Corporate and Business Law (Global) · Agency law
Mara owns a boutique and asks Jonas, a friend, to buy some fabric on her behalf from Textile Co, telling Jonas to say he acts for her. Jonas does so and agrees a purchase. Which description best fits the relationship between Mara and Jonas?
Mara is the principal and Jonas is her agent. She authorised him to contract on her behalf and he disclosed that he acted for her, so the contract he makes binds Mara and Textile Co directly.
- AMara is the principal and Jonas is her agentCorrect
- BJonas is the principal and Mara is the agent
- CMara and Jonas are partners in the purchase
- DJonas is an independent contractor with no authority to bind Mara
Explanation
An agency exists where one person (the agent) is authorised to act for another (the principal) so as to affect the principal's legal position with third parties. Mara authorised Jonas to buy on her behalf and disclosed this to Textile Co. The partnership option fails because there is no business carried on in common with a view to profit.
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