Define: Actual Authority

Actual Authority
Actual Authority
What is the dictionary definition of Actual Authority?
Dictionary Definition of Actual Authority

Actual Authority:

Actual authority refers to the legal power and permission granted to an individual or entity to act on behalf of another person or organisation. It is the explicit authorization given to an agent or representative to make decisions, enter into contracts, or perform specific tasks on behalf of their principal. Actual authority can be granted through written agreements, contracts, or by verbal instructions, and it is typically based on the principal’s explicit consent or delegation of power. This type of authority is legally binding and holds the agent accountable for their actions within the scope of their granted authority.

Full Definition Of Actual Authority

Actual authority refers to the authority that an agent has been explicitly given by the principal to act on their behalf. It is the authority that is expressly communicated to the agent, either orally or in writing, and is within the scope of the agent’s role or position. Actual authority can be conferred through a formal agreement, contract, or power of attorney.

The principal is bound by the actions of the agent if the agent acts within the scope of their actual authority. This means that the principal is legally responsible for the agent’s actions and any consequences that may arise from those actions. However, if the agent exceeds their actual authority and acts outside the scope of their role, the principal may not be bound by those actions.

Actual authority can be terminated or revoked by the principal at any time, either by expressly communicating the revocation to the agent or through the termination of the agency relationship. It is important for principals to clearly define and communicate the extent of an agent’s actual authority to avoid any misunderstandings or potential legal issues.

In summary, actual authority refers to the explicit authority given to an agent by the principal to act on their behalf. It is binding on the principal if the agent acts within the scope of their actual authority, but can be terminated or revoked at any time.

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This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.

This glossary post was last updated: 29th March 2024.

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