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ba archive – agency 2008

First Class Assignment (Monday Aug. 18, 2008, 11.00 am) (A110):
Please read CB pages 1-15.
We will begin by studying agency. Agency principles are important in many different contexts. You will be familiar already with the concept of respondeat superior, according to which masters are legally liable for the torts of their servants under some circumstances. We will see that agents can also bind their principals to liability under contracts. So, from the perspective of an unpaid creditor, agency principles can be used to reach into deep pockets (if the principal is wealthy or has insurance).

There’s a discussion of the Cyberheat decision here.

The Cyberheat case was settled in March 2008 – Cyberheat agreed to pay a civil penalty of $413,000, and to manage its business in such ways as to minimise the risk of violations of the Act in future.

WEEK 1: 18-22 August 2008
This week we will read the first chapter of the casebook, on agency.

There will be no class on Tuesday 19 August. We will not need to schedule make-up classes as our original scheduling included a number of extra minutes.

WEEK 2: 25 -29 AUGUST 2008
We continue this week with the material on agency in the first chapter of the casebook (beginning at page 16). By Thursday we should be beginning the partnership material, so it would be a good idea to read to page 67. Please also be sure to look at the Florida RUPA Statute accessible from this page.

On Monday we should discuss Case Farms and Bethany Pharmacal and may begin to look at the problem on pp 31-2.

Castillo v Case Farms
When a firm uses workers who are supplied by agencies for temporary workers, should it generally be treated as the employer under agency principles, or is this case a special case? If so, what makes the case special? Does the fact of special statutory protections for migrant workers make a difference here? Why were the provision of housing and transportation treated as being within the implied authority of ATC? Why didn’t it matter that ATC did not have any authority to hire employees and make them employees of Case Farms?

Ontario recently carried out a consultation exercise on this topic. The consultation document states:

It appears that work through temporary help agencies has changed greatly over the past decade or so:
• In the 1970s and 1980s, employment through temporary help agencies was mostly in short-term, clerical jobs that lasted a few days or weeks. Temporary help agency workers were called in when regular staff members were away sick or on vacation.
• Today, agencies supply workers in a wide range of occupations to industries such as manufacturing, construction, service, and information technologies.
• An employee of an agency might be assigned to a single client business for several months, or even years.
• In many cases, agency employees work side-by-side with the staff of an agency’s client business, doing the same type of work.
This situation has raised questions about whether temporary help agency workers are being treated fairly, compared to permanent or “regular” employees.

3rd Restatement of Agency, § 2.05:

Estoppel to Deny Existence of Agency Relationship
A person who has not made a manifestation that an actor has authority as an agent and who is not otherwise liable as a party to a transaction purportedly done by the actor on that person’s account is subject to liability to a third party who justifiably is induced to make a detrimental change in position because the transaction is believed to be on the person’s account, if
(1) the person intentionally or carelessly caused such belief, or
(2) having notice of such belief and that it might induce others to change their positions, the person did not take reasonable steps to notify them of the facts.

On Tuesday I will aim to finish Chapter 1.