Duhaime's Law Dictionary

Agency Definition:

A fiduciary relationship between one person (a principal) and another (an agent) that the agent shall act on the principal's behalf.

Related Terms: Agent, Principal

In Batzel v Smith, Justice Berzon of the United States Court of Appeals adopted these words:

"Agency is the fiduciary relationship that arises when one person (a principal) manifests assent to another person (an agent) that the agent shall act on the principal's behalf and subject to the principal's control, and the agent manifests assent or otherwise consents so to act."

An alternate statement of the law can be found in these words of Justice Kanner of the District Court of Appeal of Florida in the 1958 case of King v. Young:

"The term agency may be defined as a contract either express or implied upon a consideration, or a gratuitous undertaking, by which one of the parties confides to the other the management of some business to be transacted in his name or on his account, and by which that other assumes to do the business and render an account of it.

"In an agency relationship, the party for whom another acts and from whom he derives authority to act is known and referred to as a principal, while the other party who acts for and represents the principal and who acquires his authority from him is known and referred to as an agent. Thus, the agent steps into the shoes of his principal and acts for him pursuant to the grant of authority vested in him by the principal."


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