Author Question: Implied authority consists of: a. the power of an agent to do whatever is authorized by the Uniform ... (Read 106 times)

Frost2351 · **on:** Jun 24, 2018

Implied authority consists of:
a. the power of an agent to do whatever is authorized by the Uniform Agency Act b. the power to mingle the funds of the agent and principal
c. limits on an agent's actions, so that the agent may only do what the principal orders, in writing or orally d. the power of the agent to withhold services if the principal fails to pay her
e. none of the other choices

Question 2

Preexisting Duty. New England Rock Services, Inc, agreed to work as a subcontractor on a sewer project on which Empire Paving, Inc, was the general contractor. For drilling and blasting a certain amount of rock, Rock Services was to be paid 29 per cubic yard or on a time-and-materials basis, whichever was less. From the beginning, Rock Services encountered problems. The primary obstacle was a heavy concentration of water, which, according to the custom in the industry, Empire should have controlled but did not. Rock Services was compelled to use more costly and time-consuming methods than anticipated, and it was unable to complete the work on time. The subcontractor asked Empire to pay for the rest of the project on a time-and-materials basis. Empire signed a modification of the original agreement. On completion of the work, Empire refused to pay Rock Services the balance due under the modification. Rock Services filed a suit in a Connecticut state court against Empire. Empire claimed that the modification lacked consideration and was thus not valid and enforceable. Is Empire right? Why or why not?

fwbard · **Reply #1 on:** Jun 24, 2018

Answer to Question 1

e

Answer to Question 2

Preexisting duty
The court concluded that the modification of the contract between Rock Services and Empire was valid, and awarded Rock Services the amount owing under the modification. Empire appealed. The state intermediate appellate court affirmed the judgment of the trial court. The appellate court acknowledged that a modification of an agreement must be supported by valid consideration and requires a party to do, or promise to do, something further than, or different from, that which he is already bound to do. The court noted an exception to the preexisting duty rule, however, where a contract must be performed under burdensome conditions not anticipated, and not within the contemplation of the parties at the time when the contract was made. Applying these principles to this case, the court pointed out that Empire's failure to control or remove the water on the site constituted a new circumstance that Rock Services did not anticipate at the time the original contract was signed. Empire's duty to control the water was part of the industry's customs, which were part of the expectations of the parties under the original agreement. Thus, Rock Services' request for the modification was not wrongful but, rather, was justified under the circumstances.