What Is An Agent?

 

By Albert L. Kelley

 

When you have authorized someone to act on your behalf, you create an “agency” situation. You become what is called the principal and the person you retain becomes the agent. But what does this really mean?

 

 

An agent is not an employee, although employees can be agents. An agent is authorized to actually represent the employer and act on his behalf. An employee generally does not represent the employer, as they cannot enter into agreements for their employer. An exception is salespeople. They generally can be considered agents of the company they work for because they are authorized to enter into sales contracts for the employer.

 

 

Likewise, an agent is not an independent contractor. As independent contractor is contracted to perform a certain function for the company. An independent contractor works at his own direction, whereas an agent is controlled by the principal.

 

 

Lawyers are not always agents, but often serve that purpose. For instance, if you hire a lawyer to sue someone, the lawyer is your agent for the purposes of drafting the lawsuit and filing it. Most lawsuits do not require the party to sign the complaint, so long as the lawyer signs it. However, the Florida Bar does not allow lawyers to settle cases without their clients’ knowledge, approval and signatures. In this sense you could say lawyers are agents for starting lawsuits, but not always for ending them. Many corporate lawyers are agents of the corporations that hire them, negotiating and executing contracts for the company. Also, many lawyers become agents for certain clients. This includes sports agents, entertainment agents and literary agents. Their job is to negotiate contracts for their clients.

 

 

There are three basic types of agency. A special agent has been retained to perform a specific function. Once that function has been performed, the agency ends. An example is if the principal appoints an agent to negotiate a contract with a specific vendor. The principal may choose to do this because the agent has a better relationship with the vendor than the principal and can get a better deal for the company. Once the contract has been executed, the agency agreement is over.

 

 

A general agent is one appointed to do anything that needs to be done in regards to a certain time, place or business. If a business hires a manager of a store and gives him full power to run the store, he is a general agent.

 

 

A universal agent has full power to do anything the principal might do. Thus, if the principal is leaving the country for a while, he can give full power of attorney to someone to take care of everything while he is gone. This would include running his business, caring for his house, maintaining his car, etc. The agency would last until the principal takes some action to revoke it.

 

 

Al Kelley is a Florida business law attorney located in Key West and previously taught business law, personnel law and labor law at St. Leo University. He is also the author of “Basics of Business Law” (Absolutely Amazing e-Books). This article is being offered as a public service and is not intended to provide specific legal advice. If you have any questions about legal issues, you should confer with a licensed Florida attorney.

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