The Draft Common Frame of Reference – Agency Authority and Its Scope – A Glance at Corporation Law
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Katja Langenbucher
Abstract
Legal rules on agency reflect the tension between the expectations of the principal on the one hand and the reliance of the contracting third party on the other. The Draft Common Frame of Reference speaks to situations where the representative is involved in a conflict of interest – the principal may avoid the contract if the third party knew or could reasonably be expected to have known the conflict. If the representative is misusing his authority but is not involved in a conflict of interest, the contract with the third party will remain valid; however the representative will be required to compensate the principal. It seems that the Draft Common Frame of Reference is yet to adequately address instances where the representative has misused his authority but was not involved in a conflict of interest. The rules seem to favour the representative by not allowing the principal to avoid the contract even if the representative's misuse of authority was evident to the third party. In such cases, it is proposed to shift the burden to the third party: the principal should be able to avoid the contract if the third party knew the representative's misuse of authority or if it was evident to the third party.
Articles in the same Issue
- Editorial
- The Structure of the DCFR – Which Approach for Today's Contract Law?
- Common Frame of Reference & Social Justice
- The Draft-Common Frame of Reference, Methodological Nationalism and the Way Forward
- Sense and Sensibilities: The DCFR and the Preservation of Cultural and Linguistic Plurality
- Pre-contractual Duties in the Draft Common Frame of Reference – What Relevance for the Negotiation of Commercial Contracts?
- The Draft Common Frame of Reference: Mistake and Duties of Disclosure
- Good faith and fair dealing in the DCFR
- The Draft Common Frame of Reference – Agency Authority and Its Scope – A Glance at Corporation Law
- The DCFR – Guarantee and Personal Security Contracts
- Burden of Proof in the Consumer Acquis and in the Draft Common Frame of Reference: Law, Fact and Things in Between
- The DCFR – Restitution, unjust enrichment and related issues
- EC Legislation. European Community Legislation and Actions
- Italy
- Free Movements and Contract Law
- Books Received and Book Reviews
Articles in the same Issue
- Editorial
- The Structure of the DCFR – Which Approach for Today's Contract Law?
- Common Frame of Reference & Social Justice
- The Draft-Common Frame of Reference, Methodological Nationalism and the Way Forward
- Sense and Sensibilities: The DCFR and the Preservation of Cultural and Linguistic Plurality
- Pre-contractual Duties in the Draft Common Frame of Reference – What Relevance for the Negotiation of Commercial Contracts?
- The Draft Common Frame of Reference: Mistake and Duties of Disclosure
- Good faith and fair dealing in the DCFR
- The Draft Common Frame of Reference – Agency Authority and Its Scope – A Glance at Corporation Law
- The DCFR – Guarantee and Personal Security Contracts
- Burden of Proof in the Consumer Acquis and in the Draft Common Frame of Reference: Law, Fact and Things in Between
- The DCFR – Restitution, unjust enrichment and related issues
- EC Legislation. European Community Legislation and Actions
- Italy
- Free Movements and Contract Law
- Books Received and Book Reviews
