Concept explainers
Case s ummary :Person B hired person S to assist him in selling insurance for his company MLC. B found that S was simultaneously selling the insurance of another company PLC. B withheld the client’s contact information from S and terminated the contract. S brought a suit against B for loss in sale and commissions.
To find :The principal and the agent in the given scenario.
Explanation of Solution
An agent can be an independent contractor or an employee of a company. The court considers the status of a worker on the basis of the degree of control exercised by the principal over him. Less control indicates that an agent is an independent contractor while more control indicates that the agent is an employee. In the given case, B hired S for assisting him in selling insurance for his company. Therefore, B is the principal and S is the agent in the given case.
Case summary: Person B hired person S to assist him in selling insurance for his company MLC. B found that S was simultaneously selling the insurance of another company PLC. B withheld the client’s contact information from S and terminated the contract. S brought a suit against B for loss in sale and commissions.
To find: The method by which the agency relationship was formed.
Explanation of Solution
An agency can be formed by voluntary consent or by agreement between the parties. In this case, the agency relationship was formed by an agreement between B and S, where B was hired to assist S in selling the life insurance for MLC.
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