The doctrine of apparent authority as a precondition for sustainable business

Vaidas Jurkevičius (), Vaidas Jurkevičius () and Yuliia Pokhodun ()
Additional contact information
Vaidas Jurkevičius: Mykolas Romeris University, Lithuania
Vaidas Jurkevičius: Vilnius Gediminas Technical University (VILNIUS TECH), Lithuania
Yuliia Pokhodun: Mykolas Romeris University, Lithuania

Entrepreneurship and Sustainability Issues, 2018, vol. 6, issue 2, 649-661

Abstract: In the light of modern commercial relationships, the doctrine of apparent authority plays an important role in ensuring the sustainability of business. Where the business undertaking is a large and complex one, it would be difficult and inconvenient for a person or legal entity to communicate every transaction with the agent. Thus, an agent’s effective powers in dealing with third parties may extend to transactions that he was not authorized to undertake by the principal. Such situations are usually characterized as apparent authority. The difficulty with this type of authority lies in the lack of control on the part of the principal which entails certain questions of liability of either the agent or the principal. Even though the third party has to check the agent’s authority, he cannot know about all the details of the agent’s internal authorization. Therefore, there is always a risk that the agent was not authorized to act. This article is deemed to provide a comprehensive analysis of the doctrine of apparent authority from a comparative perspective. A conclusion is made that the doctrine is an efficient mean of apportioning the risk of liability for agent’s unauthorized act between the principal and the third party with individual factors determining who must bear liability it in every specific case.

Keywords: agent; unauthorized agency; apparent authority; manifestations of authority; estoppel doctrine; sustainable business (search for similar items in EconPapers)
JEL-codes: K12 K20 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://jssidoi.org/jesi/uploads/articles/22/Jurke ... ainable_business.pdf (application/pdf)
https://jssidoi.org/jesi/article/244 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ssi:jouesi:v:6:y:2018:i:2:p:649-661

DOI: 10.9770/jesi.2018.6.2(13)

Access Statistics for this article

Entrepreneurship and Sustainability Issues is currently edited by Manuela Tvaronaviciene

More articles in Entrepreneurship and Sustainability Issues from VsI Entrepreneurship and Sustainability Center
Bibliographic data for series maintained by Manuela Tvaronaviciene ().