Clarifying Mutual Consent’s Role in Agency Law

TL;DR

This paper argues that mutual consent is not always needed for an agent to have authority, clarifying the role of consent in legal agency relationships.

Contribution

The paper challenges the necessity of mutual consent in conferring agent authority, showing it can be done unilaterally.

Findings

An agent's consent is not a necessary precondition for authority.

Unilateral authority conferral results in two unique features in the principal-agent relationship.

Mutual consent justifies some, but not all, aspects of agency.

Abstract

Important cases and academic commentators have suggested that the mutual consent of principal and agent is necessary for actual authority to be conferred on the agent. The chief purpose of this article is to show that this view of mutual consent’s role in agency law is inaccurate and misleading. Its central claim is that the agent’s consent is not a necessary pre-condition for the conferral of authority. Instead, a principal can confer authority on an agent unilaterally. However, when authority is conferred unilaterally on an agent, the external aspect of agency is fully present, but the internal principal–agent relationship possesses two unique features, one relating to the agent’s duties and the other relating to the agent’s ability to disclaim. The account presented here thus clarifies the proper scope of ‘mutual consent’ justifications in agency. Mutual consent may justify some incidents of agency, but it does not justify them all.