Apparent Agency Law South Carolina
The elements of apparent agency are:
(1) purported principal consciously or impliedly represented another to be his agent;
(2) third party reasonably relied on the representation;
(3) third party detrimentally changed his or her position in reliance on the representation. See Graves v. Serbin Farms, Inc., 306 S.C. 60, 409 S.E.2d 769 (1991); ZIV Television Programs, Inc. v. Associated Grocers, Inc., 236 S.C. 448, 114 S.E.2d 826 (1960).
A true agency relationship may be established by evidence of actual or apparent authority. See Fochtman v. Clanton's Auto Auction Sales, 233 S.C. 581, 106 S.E.2d 272 (1958). See also Fernander v. Thigpen, 278 S.C. 140, 293 S.E.2d 424 (1982) (agency relationship may be proven by evidence of apparent or implied authority, even where parties have entered agreement to contrary).
The doctrine of apparent authority focuses on the principal's manifestation to a third party that the agent has certain authority. Rickborn v. Liberty Life Ins. Co., 321 S.C. 291, 468 S.E.2d 292 (1996).
Concomitantly, the principal is bound by the acts of its agent when it has placed the agent in such a position that persons of ordinary prudence, reasonably knowledgeable with business usages and customs, are led to believe the agent has certain authority and they in turn deal with the agent based on that assumption.
Fernander, supra; Eadie v. H.A. Sack Co., 322 S.C. 164, 470 S.E.2d 397 (Ct. App. 1996). Thus, the concept of apparent authority depends upon manifestations by the principal to a third party and the reasonable belief by the third party that the agent is authorized to bind the principal. Beasley v. Kerr-McGee Chem. Corp., 273 S.C. 523, 257 S.E.2d 726 (1979); Visual Graphics Leasing Corp. v. Lucia, 311 S.C. 484, 429 S.E.2d 839 (Ct. App. 1993).
See also Moore v. North American Van Lines, 310 S.C. 236, 423 S.E.2d 116 (1992) (basis of apparent authority is representations made by principal to third party and reliance by third party on those representations).
Apparent authority must be established based upon manifestations by the principal, not the agent. See Shropshire v. Prahalis, 309 S.C. 70, 419 S.E.2d 829 (Ct. App. 1992).
The proper focus in determining a claim of apparent authority is not on the relationship between the principal and the agent, but on that between the principal and the third party. Vereen v. Liberty Life Ins. Co., 306 S.C. 423, 412 S.E.2d 425 (Ct. App. 1991).
An agency may not be established solely by the declarations and conduct of an alleged agent. Frasier v. Palmetto Homes, 323 S.C. 240, 473 S.E.2d 865 (Ct. App. 1996).
Apparent authority to do an act is created as to a third person by written or spoken words or any other conduct of the principal which, reasonably interpreted, causes the third person to believe the principal consents to have the act done on his behalf by the person purporting to act for him. Id.
Either the principal must intend to cause the third person to believe the agent is authorized to act for him, or he should realize his conduct is likely to create such belief. Id.
See also Watkins v. Mobil Oil Corp., 291 S.C. 62, 352 S.E.2d 284 (Ct. App. 1986) (to establish apparent agency, party must prove purported principal has represented another to be his agent by either affirmative conduct or conscious and voluntary inaction).
In the principal and agent relationship, apparent authority is considered to be a power which a principal holds his agent out as possessing or permits him to exercise under such circumstances as to preclude a denial of its existence. Beasley v. Kerr-McGee Chem. Corp., 273 S.C. 523, 257 S.E.2d 726 (1979); Anthony v. Padmar, Inc., 307 S.C. 503, 415 S.E.2d 828 (Ct. App. 1992).
When a principal, by any such acts or conduct, has knowingly caused or permitted another to appear to be his agent, either generally or for a particular purpose, he will be estopped to deny such agency to the injury of third persons who have in good faith and in the exercise of reasonable prudence dealt with the agent on the faith of such appearances. Mortgage & Acceptance Corp. v. Stewart, 142 S.C. 375, 140 S.E. 804 (1927).
The apparent authority of an agent results from conduct or other manifestations of the principal's consent, whereby third persons are justified in believing the agent is acting within his authority. Genovese v. Bergeron, 327 S.C. 567, 490 S.E.2d 608 (Ct. App. 1997).
Such authority is implied where the principal passively permits the agent to appear to a third person to have the authority to act on his behalf. Id.
Generally, agency is a question of fact. Gathers v. Harris Teeter Supermarket, 282 S.C. 220, 317 S.E.2d 748 (Ct. App. 1984).
Agency may be implied or inferred and may be proved circumstantially by the conduct of the purported agent exhibiting a pretense of authority with the knowledge of the alleged principal. Fernander v. Thigpen, 278 S.C. 140, 293 S.E.2d 424 (1982).
If there are any facts tending to prove an agency relationship, it then becomes a question for the jury. Gathers, supra.