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Apparent Authority
Updated 1/4/2024 PG
An agent acts with apparent authority “when a third-party reasonably believes the actor has authority to act on behalf of the principal and that belief is traceable to the principal’s manifestations.” Restatement (Third) of Agency § 2.03. In other words, if the principal says something or takes some action that causes a third-party to reasonably believe the agent is acting on behalf of the principal, then the agent has apparent authority. Both actual authority and apparent authority require a reasonable belief traceable to the principal’s actions. In actual authority, it is the agent’s reasonable belief. In apparent authority, it is the third-party’s reasonable belief.
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