Multiple choice

A, B and C are partners in a firm of ABC & Co. D, an outsider, deals with the firm through A. Between A and B A is the Principal and A is also an agent of B and C. In addition. D can sue, in case of default A, B and C.

  1. True

  2. False

  3. Partly true

  4. Cannot say
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

When D deals with firm through A, A is principal for D but agent for B and C. Mutual agency exists - A can bind the firm. If A defaults, D can sue all partners (A, B, C) because the firm is bound by A's authorized acts.

Keep practicing — related questions