Chapter 20

COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 1PART 3 AGENCY Chapter 20. Agency in General. Chapter 21. Particular Agencies. CHAPTER 20 AGENCY IN GENERAL Article 1. Definition of Agency . Article 2. Authority of Agents. Article 3. Mutual Obligations of Principals and Third Persons. Article 4. Agent 's Obligations to Third Persons. Article 5. Delegation of Agency . Article 6. Termination of Agency . ARTICLE 1 DEFINI TION OF AGENCY § 20101. Agency . § 20102. Who may Appoint and Who may be an Agent. § 20103. General or Special Agents. § 20104. Actual o r Ostensible Agents. § 20105. Actual Agency . § 20106. Ostensible agency . § 20101. Agency. An agent is one who repre sents an other , called the principal , in dealings with third persons. Such representation is called agency . SOURCE: CC § 2295. All sou rces in this Chapter are to the original enactment in 1953 unless otherwise stated. § 20102. Who may Appoint and Who may be an Agent. Any person having capacity to contract may appoint an agent, and any person may be an agent. SOURCE: CC § 2296. § 20103 . General or Special Agents.

§ 20102. Who may Appoint and Who may be an Agent. Any person having capacity to contract may appoint an agent, and any person may be an agent. SOURCE: CC § 2296. § 20103 . General or Special Agents. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 2An agent for a particular act or transaction is called a special agent. All others are general agents. SOURCE: CC § 2297. § 20104. Actual or Ostensible Agents. An agency is either actual or ostensible. SOURCE: CC § 2298. § 20105. Actual Agency. An agency is actual when the agent is really employed by the principal. SOURCE: CC § 2299. § 20106. Ostensible Agency. An agency is ostensible when the principal intentionally , or by want of ordinary care, causes a third person t o believe another to be his agent who is not really employed by him. SOURCE: CC § 2300. NOTE: No '§ 2301 -2303 existed in the Civil Code. ---------- ARTICLE 2 AUTHORI TY OF AGENTS § 20201. What Authority may be Conferred. § 20202. Agent may Perform Act s Required by Law . § 20203. Agent Cannot have Authority to Defraud Princi pal. § 20204. Creation of Agency . § 20205. Consideration Unnecessary . § 20206. Form of Authority . § 20207.

ay Perform Act s Required by Law . § 20203. Agent Cannot have Authority to Defraud Princi pal. § 20204. Creation of Agency . § 20205. Consideration Unnecessary . § 20206. Form of Authority . § 20207. Ratification of Agent's Acts. § 20208. Ratification of a Part of Trans action. § 20209. When Ratification V oid. § 20210. Ratification not to Injure Third Parties. § 20211. Recision after Ratification. § 20212. Measure of Agent's Authority . COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 3§ 20213. What is Actual Authority . § 20214. What is Ostensible Authority . § 20215 .Agent's Authority as to Those Having Notice of Restrictions. § 20216. Agent's Necessary Authority . § 20217. Agent Disobeying Instructions. § 20218. How Authority Construed. § 20219. Exceptions to General Authority . § 20220. Sale of Personal Property -Scope of Authority . § 20221. Sale of Real Property -Scope of Authority . § 20222. Authority of General Agent -Receipt of Price of Property . § 20223. Authority of Special Agent -Receipt of Price. § 20201. What Authority may be Conferred. An agent ma y be authorized to do any acts which his principal might do, except those to which the latter is

3. Authority of Special Agent -Receipt of Price. § 20201. What Authority may be Conferred. An agent ma y be authorized to do any acts which his principal might do, except those to which the latter is bound to give his personal attention. SOURCE: CC § 2304. § 20202. Agent may Perform Acts Required by Law. Every act which, according to this Code, may be do ne by or to any person, may be done by or to the agent of such person for that purpose, unless a contrary intention clearly appears. SOURCE: CC § 2305. NOTE: The term Code refers to the former Civil Code, which now is found in a number of separate Titles of the Guam Code Annotat ed. See the Table of Sections Affected in the latest Session Laws and in the tables in this Title for the specific equivalent sections. § 20203. Agent Cannot Have Authority to De fraud Principal. An agent can never have authority , either actual or ostensible, to do an act which is, and is known or suspected by the person with whom he deals, to be a fraud upon the principal. SOURCE: CC § 2306. § 20204. Creation of Agency. An agency may be created, and an authority may be conferr ed, by a precedent authori zation or a subsequent ratification.

e a fraud upon the principal. SOURCE: CC § 2306. § 20204. Creation of Agency. An agency may be created, and an authority may be conferr ed, by a precedent authori zation or a subsequent ratification. SOURCE: CC § 2307.COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 4§ 20205. Consideration Unnecessary. A consideration is not necessary to make an authority , whether precedent or subsequent, binding upon the principal. SOURCE: CC § 2308 . § 20206. Form of Authority. An oral author ization is sufficient for any purpose, except that an authority to enter into a contract required by law to be in writing can only be given by an instrument in writing. SOURCE: CC § 2309. § 20207. Ratification ofAgent's Acts. A ratification can be made only in the manner that would have been neces saryto confer an original authority for the act ratified, or where an oral authorization would suffice, by accepting or retaining the benefit of the act, with no tice thereof. SOURCE: CC § 2310. § 20208. Ratification of a Part of T ransaction. Ratifica tion of a part of an indivisible transaction is a ratification of the whole. SOURCE: CC § 2311. § 20209. When Ratification V oid.

CC § 2310. § 20208. Ratification of a Part of T ransaction. Ratifica tion of a part of an indivisible transaction is a ratification of the whole. SOURCE: CC § 2311. § 20209. When Ratification V oid. A ratification is not valid unl ess, at the time of ratifying the act done, the principal has power to confer authority for such an act. SOURCE: CC § 2312. § 20210. Ratification not to Injure Third Par ties. No unauthorized act can be made valid, retroactively , to the prejudice of thi rd persons, without their consent. SOURCE: CC § 2313. § 20211. Rescission After Ratification. A ratification may be rescinded when made without such consent as is required in a contract, or with an imperfect knowledge of the material facts of the transac tion ratified, but not other wise. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 5SOURCE: CC § 2314. § 20212. Measure of Agent's Authority. An agent has such authority as the principal, actually or ostensibly , confers upon him. SOURCE: CC § 2315. § 20213. What is Actual Authority. Actual authority is such as a principal intentionally confers upon the agent, or intentionally , or by want of ordinary care, allows the agent to

SOURCE: CC § 2315. § 20213. What is Actual Authority. Actual authority is such as a principal intentionally confers upon the agent, or intentionally , or by want of ordinary care, allows the agent to believe himself to possess. SOURCE: CC § 2316. § 20214. What is Ostensible Authority. Osten sible authority is such as a pri ncipal intentional ly, or by want of ordinary care, causes or allows a third person to believe the agent to possess. SOURCE: CC § 2317. § 20215. Agent's Authority as to Those Having Notice of Restrictions. Every agent has actually such authority as defin ed in this Part, unless specially deprived thereof by his principal, and has even then such authority ostensibly , except as to persons who have actual or constructive notice of the restriction upon his authority . SOURCE: CC § 2318. § 20216. Agent's Neces sary Authority. An agent has authority: 1. To do everything necessary or proper and usual, in the ordinary course of busi ness, for effecting the purpose of his agen cy, and 2. To make a representation regarding any matter of fact, not including the ter ms of his authority , but upon which his right to use his authority depends, and the truth of which cannot

agen cy, and 2. To make a representation regarding any matter of fact, not including the ter ms of his authority , but upon which his right to use his authority depends, and the truth of which cannot be determined by the use of reason - able diligence on the part of the person to whom the representation is made. SOURCE: CC § 2319. § 20217. Agent Disobeying Instructions. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 6An agent has power to disobey instructions in dealing with the subject of the agency , in cases where it is clearly for the interest of his princi pal that he should do so, and there is not time to communicate with the principal. SOURCE: CC § 2320. § 20218. How Authority Construed. When an authority is given partly in general and partly in specific terms, the general authority gives no higher powers than those specifically mentioned. SOURCE: CC § 2321. § 20219. Exceptions to Gene ral Authority. An authority expressed in general terms, however broad, does not authorize an agent: 1. To act in his own name, unless it is the usual course of business to do so; 2. To define the scope of his agency; or 3.

rity expressed in general terms, however broad, does not authorize an agent: 1. To act in his own name, unless it is the usual course of business to do so; 2. To define the scope of his agency; or 3. To do any act which a trustee is for bidden to do by Part 4, Chapter 25, Article 2 of this Title. SOURCE: CC § 2322. § 20220. Sale of Personal Property -Scope of Authority. An authority to sell personal proper ty includes authority to warrant the title of the principal, and the qu ality and quantity of the property . SOURCE: CC § 2323. § 20221. Sale of Real Property -Scope of Authority. An authority to sell and convey real property includes authori tyto give the usual covenants of warranty . SOURCE: CC § 2324. § 20222. Authorit y of General Agent -Receipt of Price of Property. A general agent to sell, who is instructed by the principal with the possession of the thing sold, has authori tyto receive the price. SOURCE: CC § 2325. § 20223. Authority of Special Agent -Receipt o f Price. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 7A special agent to sell has authority to receive the price on delivery of the thing sold, but not afterwards. SOURCE: CC § 2326.

. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 7A special agent to sell has authority to receive the price on delivery of the thing sold, but not afterwards. SOURCE: CC § 2326. NOTE: No ''2327 -2329 existed in the Civil Code. ---------- ARTICLE 3 MUTUAL OBLIGA TIONS OF PRINCIP ALS AND THIRD PERSONS § 20301. How Principal Affected by Agent's acts Within Scope of his Authority . § 20302. When Principal Bound by Incomplete Execution of Authority . § 20303. When Notice to Agent is Notice to Principal. § 20304. Obligation of Principal when agen t Exceeds Au thority . § 20305. Principal Bound for Acts Done under Ostensible Authority . § 20306. When Exclusive Credit Given to Agent. § 20307. Dealing with Agent Without Knowledge of Agen cy. § 20308. Instrument Intending to Bind Principal does Bind Him. § 20309. Principal's Responsibility for Negli gence or Omis sion. § 20310. Principal's Responsibility for Wrongs Willfully Committed by the Agent. § 20301. How Principal Affected by Agent's acts Within Scope of his Authority. An agent repre sents his principal for all purposes within the scope of his actual or ostensible authority , and all the rights and liabilities

Affected by Agent's acts Within Scope of his Authority. An agent repre sents his principal for all purposes within the scope of his actual or ostensible authority , and all the rights and liabilities which would accrue to the agent from transactions within such limit, if they had been entered into on his own ac count, accrue to th e principal. SOURCE: CC § 2330. § 20302. When Principal Bound by Incomplete Execu tion of Authority . A principal is bound by an incomplete execution of an authority , when it is consistent with the whole purpose and scope thereof, but not otherwise. SOUR CE: CC § 2331. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 8§ 20303. When Notice to Agent is Notice to Principal. As against a principal, both principal and agent are deemed to have notice of whatever either has notice of, and ought, in good faith and the exercise of ordinary care and dili gence, t o communicate to the other . SOURCE: CC § 2332. § 20304. Obligation of Principal when Agent Exceeds Authority. When an agent exceeds his authority , his principal is bound by his author ized acts so far only as they can be plainly separated from those which are unautho rized.

pal when Agent Exceeds Authority. When an agent exceeds his authority , his principal is bound by his author ized acts so far only as they can be plainly separated from those which are unautho rized. SOURCE: CC § 2333. § 20305. Principal Bound for Acts done under Ostensi ble Authority. A principal is bound by the acts of his agent, under a merely ostensible authority , to those persons only who have in good faith and without wa nt of ordinary care incurred a liability or parted with value, upon the faith thereof. SOURCE: CC § 2334. § 20306. When Exclusive Credit Given to Agent. If exclusive credit is given to an agent by the person dealing with him, his principal is exoner ated by payment or other satisfaction made by him to his agent in good faith, before receiving notice of the creditor's election to hold him responsible. SOURCE: CC § 2335. § 20307. Dealing with Agent Without Knowledge of Agency. One who deals with an age nt without knowing or having reason to believe that the agent acts as such in the transaction, may set off against any claim of the principal arising out of the same, all claims which he might have set off against the agent before notice of the agency .

e agent acts as such in the transaction, may set off against any claim of the principal arising out of the same, all claims which he might have set off against the agent before notice of the agency . SOURCE: CC § 2336. § 20308. Instrument Intending to Bind Principal does Bind him. An instrument within the scope of his authority by which the agent intends to bind his principal, does bind him if such intent is plainly infe rable from the instrument itsel f. SOURCE: CC § 2337.COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 9§ 20309. Principal's Responsibility for Negli gence or Omission. Unless required by or under the authority of law to employ that particular agent, a principal is responsi ble to third persons for the negligence of his agent in the t ransaction of the business of the agency , including wrong ful acts committed by such agent in and as a part of the transaction of such business, and for his willful omission to fulfill the obligations of the principal. SOURCE: CC § 2338. § 20310. Princip al's Responsibility for Wrongs Willfully Committed by the Agent. A principal is responsible for no other wrongs committed by his agent than those mentioned in §

l. SOURCE: CC § 2338. § 20310. Princip al's Responsibility for Wrongs Willfully Committed by the Agent. A principal is responsible for no other wrongs committed by his agent than those mentioned in § 20309, unless he has authorized or ratified them, even though they are committed while the age nt is engaged in his services. SOURCE: CC § 2339. NOTE: No ''2340 -2341 existed in the Civil Code. ---------- ARTICLE 4 AGENT 'S OBLIGA TIONS TO THIRD PERSONS § 20401. Warranty of Authority . § 20402. Agent's Responsibility to Third Persons. § 20403. Surrender Property to Third Person. § 20404. Code Provisions Governing. § 20401. W arranty of Authority. One who assumes to act as an agent thereby warrants, to all who deal with him in that capacity , that he has the authority which he assume. SOURCE: CC § 2342. § 20402. Agent's Responsibility to Third Per sons. COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 10One who assumes to act as an agent is responsible to third persons as a principal for his acts in the course of his agency , in any of the following cases, and in no others: 1. When, with his con sent, credit is given to him personally in a transaction; 2.

d persons as a principal for his acts in the course of his agency , in any of the following cases, and in no others: 1. When, with his con sent, credit is given to him personally in a transaction; 2. When he enters into a written contract in the name of his principal, without believ ing, in good faith, that he has authority to do so; or 3. When his acts are wrongful in their nature. SOURCE : CC § 2343. § 20403. Surrender Property to Third Person. If an agent receives anything for the benefit of his principal, to the possession of which another person is entitled, he must, on demand, surren - der it to such person, or so much of it as he has under his control at the time of demand, on being indemnified for any advance which he has made to his principal, in good faith, on account of the same; and is responsible therefor , if, after notice from the owner, he delivers it to his principal. SOURCE: CC § 2344. § 20404. Code Provisions Governing. The provisions of this Article are subject to the provisions of 19 Guam Code Annotated, Chapter 1. SOURCE: CC § 2345. NOTE: The Civil Code '2345 refers to 'Part 1 of Division First of this Code'.

ng. The provisions of this Article are subject to the provisions of 19 Guam Code Annotated, Chapter 1. SOURCE: CC § 2345. NOTE: The Civil Code '2345 refers to 'Part 1 of Division First of this Code'. This deals with 'Persons', specifically with minors, and is now found in 19 GCA Chapter 1, as are all other parts of the former Civil Code dealing with 'Persons' and 'Personal Rights'. NOTE: No ''2345 -2348 existed in the Civil Code. ---------- ARTICLE 5 DELEGA TION OF AGENCY § 20501. Agent's Delegation of Powers. § 20502. Unauthorized Employment of Subagent. § 20503. Subagents Generally . COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 11§ 20501. Agent's Delegation of Powers. An agent, unless specially forbidden by his princi pal to do so, can delegate his po wers to another person in any of the following cases, and in no others: 1.When the act to be done is purely mechanical; 2.When it is such as the agent cannot himself, and the subagent can lawfully perform; 3.When it is the usage of the place to deleg ate such powers; or 4. When such delegation is specially authorized by the principal. SOURCE: CC § 2349. § 20502. Unauthorized Employment of Subagent.

rm; 3.When it is the usage of the place to deleg ate such powers; or 4. When such delegation is specially authorized by the principal. SOURCE: CC § 2349. § 20502. Unauthorized Employment of Subagent. If an agent employs a subagent without authori ty, the former is a principal and the latter his age nt, and the principal of the former has no connection with the latter . SOURCE: CC § 2350. § 20503. Subagents Generally. A subagent, lawfully appointed, represents the principal in like manner with the original agent, and the original agent is not respon sible to third persons for the acts of the subagent. SOURCE: CC § 2351. NOTE: No ''2352 -2354 existed in the Civil Code. ---------- ARTICLE 6 TERMI NATION OF AGENCY § 20601. Termination of Agency . § 20602. Termination of Power of Agency . § 20601. T ermination of Agency.COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL 12An agency is termi nated, as to every person having notice thereof, by: 1. The expiration of its term; 2. The extinction of its subject; 3. The death of the agent; 4. The renunciation of the agency; or 5. The incapacity of the agent to act as such. SOURCE: CC § 2355. NOTE: In the Civil Code, V ol.

rm; 2. The extinction of its subject; 3. The death of the agent; 4. The renunciation of the agency; or 5. The incapacity of the agent to act as such. SOURCE: CC § 2355. NOTE: In the Civil Code, V ol. 2 (1970 ed.), the editor has indicated that agency is the original word used in item 5, but that agent is probably the intent of the Legislature. Since it is the person (agent) refere nced in item 4, and since the concept of agency cannot develop an incapacity , the Compil er has determined that the original intent of this section is the word agent. The equivalent item in Calif. CC § 2355 uses the term agent . § 20602. T ermination of Pow er of Agency. Unless the power of an agent is coupled with an interest in the subject of the agency , it is terminated, as to every person having notice thereof, by: 1. Its revocation by the principal; 2. His death; or 3. His incapacity to contract. SOURCE: CC § 2356. NOTE: No ''2357 -2361 existed in the Civil Code. ----------COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH.20 AGENCY IN GENERAL