Question

The owner of a construction company gives a supply list to a friend who is

going to the hardware store. The friend purchases the supplies under the
account belonging to the construction company. This is an example of what
type of situation?
A. General agency
B. Agency by ratification
C. Express appointment of agency
D. Implied appointment of agency

Answer 1

The situation described is an example of Agency by ratification, where a person acts on behalf of another without prior authorization, but the actions are later ratified or approved by the principal.

Step-by-step explanation:

The situation described in the question is an example of B. Agency by ratification. This refers to a situation where a person (the friend in this case) acts on behalf of another (the owner of a construction company) without prior authorization, but the actions are later ratified or approved by the principal (the owner).

In this case, the owner gave the supply list to the friend, who made the purchases under the account of the construction company without explicit authorization. However, when the owner accepts or approves the friend's actions, it becomes an agency by ratification.

For example, the friend may present the receipt to the owner, who pays for the supplies and acknowledges that the friend acted on their behalf. This ratification makes the friend's actions legally binding on the owner.