Principal-Agent Relationships
Introduction
The principle agent relationship is the agreement or arrangement whereby one party or organization legally appoints another to act on his behalf. In business law, there are legal theories found in principles of torts which govern the relationship of principal and the agent where the agent has contracted to transport goods on behalf of the principal (Maskin, 2018). For instance, if the agent who in this case is the driver causes an accident, he not only has to be sued but his employer as well. There are different types of the principal-agent relationship like principal-agent and principal-third party. This paper entails discussing principal-agent relationships and analyzing the case of driver Jose Carcano and the Sugar Transport Company of Northwest, LLC.
Types of Agent-Principal Relationships
The agency of law comprises of three different parties which are the principal, the agent and the third party. Therefore, there are three types of Agent-principal relationships in the regulation of agency. The first relationship is between the principal and agent, where the agent is legally appointed to act on behalf of the principal (Carruthers, 2019). The second is between the agent-third party, which happens when an agent has some rights and liabilities of the principal’s contract. The final relationship occurs between the principal and third party where the principal is liable to the third party for actions taken by an agent which fall under the authority of the principal.
Relationship type between driver Jose Carcano and Sugar Transport Co. of Northwest, LLC
In this case, the relationship between Jose and the Sugar Transport Company is Principal-Agent relationship as Jose, who is the driver, and as the agent is given authority to act in the interest of the Company. Here Sugar Transport Company is the principal. The driver, Jose, was to act on behalf of the Company by transporting its Sugar products for the Company.
The course of action recommended concerning the lawsuit and Jose’s employment
It would be better to recommend that; the Court should not have included the evidence, and the claims presented by the counsel of plaintiff and advise the Jury to share the liability between Carcano and Tagliaferri only instead of comprising even the Sugar Transport Company as also a tortfeasor it could divide the fault too (Bohdan, 2018). Therefore the trial would allocate not more than 55% to Jose alone the share of liability which is assigned to them and the Company. Despite that the Sugar Company still would have been responsible for the portion of the fault allocated to Jose; the outcome would have been good Sugar Transport as it would not have incurred additional independent liability. The trial should not have included the prejudicial risk as the Court will conclude that Carcano drove negligently not basing any prove from evidence.
Role of Sugar Transport HR in hiring Jose Carcano and employment issues found
In this context, had a responsibility to ensure Carcano was qualified for the job. This is seen from the plaintiff’s provided her negligent recruitment claim against Carcano. The Company’s human resource never made necessary evaluations from his initial employers, and this screened the Company to be having inadequate hiring practices (Wilkins, 2018). The plaintiff offered a shred of evidence claiming that Carcano was illegally in that country, his social security number was forged to secure his current job, and finally, his application details were false. The HR had the responsibility to apply enough efforts to get evaluations from his past employers, and they should have identified all those risks of hiring Carcano in their Company.
Employment law issues which were violated
From the case of Jose and the Sugar Transport Company, some of the employment laws are legally problematic regarding his recruitment. For instance, there is the hiring laws which govern background checks, the employment contracts and for this case, the Sugar Transport company’s violated hiring laws as its HR did not put efforts in getting Carcano’s background information from his initial contractors (Brown, 2017). Another law which was violated is the license as Carcano’s license number was forged to enable him to get a job in the Company (Barajas, 2019). It was a crime for Carcano to use a force security number in his contract with the Company.
Conclusion
In conclusion, the paper has analyzed the case of Jose, the driver and the Sugar Transport Company to show how the principal agency relationship is influenced by the agency law under the principles of tort. From the case, it is vivid that an employer, the Sugar Transport Company has to be liable for the faults sustained by people because of the driving negligence of its agent, the driver. I would recommend prejudicial risks are not applied during the court rule in cases similar to Carcano’s to ensure fairness, avoid misleading and avoid waste of time in the trial.
References
Barajas, J. (2019). The effects of driver licensing laws on immigrant travel. https://doi.org/10.31235/osf.io/sw7rp
Bohdan, A. (2018). Internal transport in sugar-producing company. AUTOBUSY – Technika, Eksploatacja, Systemy Transportowe, 19(6), 1012-1017. https://doi.org/10.24136/atest.2018.219
Brown, R. C. (2017). Hiring and employment practices and the law. Understanding Labor and Employment Law in China, 65-74. https://doi.org/10.1017/cbo9780511642258.008
Carruthers, N. (2019). Principal-agent relationships. Relationship Marketing: Theory and Practice, 29-39. https://doi.org/10.4135/9781446252062.n3
Maskin, E. (2018). The principal-agent relationship with an informed principal, II: Common values. Econometrica, 60(1), 1. https://doi.org/10.2307/2951674
Wilkins, A. L. (2018). The creation of company cultures: The role of stories and human resource systems. Human Resource Management, 23(1), 41-60. https://doi.org/10.1002/hrm.3930230105