Apparent authority (English agency law)
Apparent or ostensible authority can bind a principal where the principal, by words or conduct, represents to a third party that the agent has authority and the third party relies on that representation. The representation must be attributable to the principal; the agent’s unsupported assertion alone is insufficient. The actual facts, knowledge of any limits and applicable legal rules matter.
Worked example
A company holds out its manager as authorised to make a particular type of purchase. A supplier relies on that representation and contracts with the manager; apparent authority may bind the company even if an undisclosed internal restriction was exceeded.
Common mistake
Assuming an agent can create apparent authority solely by claiming it, without a representation attributable to the principal and reliance.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | LW (ENG) | Direct | September 2026–June 2027 |