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Subject Topic: Becker and Gleim have different answers (Topic Closed Topic Closed) Post ReplyPost New Topic
  
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kanba
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Joined: 06 Nov 2011
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Posted: 29 Dec 2011 at 20:51 | IP Logged  

Becker and Gleim have different answer to this question:

A disclosed principal will be liable to third party for its agent's unauthorized misrepresentation if the agent is an

    employee    independent contractor

A. Yes         &nb sp;  Yes

B. Yes         &nb sp;   No

Becker's answer is B since principal is just liable for employee's tort. However Gleim's answer is A. The explaination is for unauthorized misrepresentation, principal is liable for both employee and independent contractor although in general principal is just liable for employee's tort.

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Zipties
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Posted: 30 Dec 2011 at 10:01 | IP Logged  

Technically, they're both true, but for the CPA exam, I would say Becker is correct. Generally, a principle is not liable for the torts of independent contractors; however, it could possibly be liable if they are using independent contractors to avoid liability under "inherently dangerous activities." (Stout v. Johnson)
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