25.7k views
5 votes
​If an agent is sued for breach of implied warranty of authority by a third party, none of the following are defenses except: ______.

a. ​the agent acted in good faith.
b. ​the agent had written authorization.
c. ​the third party knew the agent was acting beyond her authority.
d. ​the agent misunderstood the scope of authority.

User WooHoo
by
7.7k points

1 Answer

4 votes

Final answer:

In cases where an agent breaches the implied warranty of authority, the only valid defense from the provided options is that the third party was aware the agent was acting beyond their authority. Good faith, written authorization, and misunderstanding do not offer a defense against the breach.

Step-by-step explanation:

If an agent is sued for breach of implied warranty of authority by a third party, the only defense among the options provided that could be valid is: c. the third party knew the agent was acting beyond her authority. This defense aligns with the principles of agency law, which hold that an implied warranty of authority creates an assumption that the agent has the authority to act on behalf of the principal.

However, if it is known by the third party that the agent is acting beyond their scope, they cannot later claim a breach of implied warranty of authority as they were aware of the agent's limitations. Neither acting in good faith, having written authorization (unless it clearly limits authority and the third party was aware of such limits), nor misunderstanding the scope of authority provides a defense for the agent in case of a breach.

The case of Bivens v. Six Unknown Named Agents demonstrates the concept of implied remedies for violations of important rights, but the case itself is more about constitutional rights rather than agency law.

User Mr Shark
by
7.7k points