Clarifying Mutual Consent’s Role in Agency Law

Abstract

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.