To: Investment Firm
From:
Date:
Subject: Assessment of Uber’s Principal-Agent Relationship
In honor of the Uber service providers, the company would love to raise some concerns which will guide the legal operations of the entity in accordance with the Corporate Governance.
In the context of business, the agency law is set as a contract that binds the relationship between an agent and a principle whereby the agent acts on behalf of the principal hence creating a legal relation with a third party. The principal gives authority to the agent to perform the agreed actions while the principal is held liable for any outcome in line with the directives. In the case of a misfortune, both the agent and the principle are held liable under the respondeat superior rule (Jennings, 2016). The victim sues both parties for negligence caused by the agent which includes and not limited to physical injuries, financial dents, and emotional injuries. On the other hand, the agent is accountable for all the expenditures incurred while acting on behalf of the principal, they are to protect the confidentiality of the principal and they are responsible for dealing with the third parties.
It is up to the agent to maintain integrity in task performance and avoid issues of negligence hence maximum care and skill are to be exercised. The scope of employment refers to the legal considerations of the activities that may be undertaken during duty performance by an employee, and more so, activities that fall under the job description stated by the employer. Uber Serves is guided by the principle of actual express authority that provides that Uber enters into a contract with the driver in taking part in the stipulated actions such as pick up and dropping off passengers (HG.org., 2020).
Tort Liability makes the principal liable to the wrongful actions of the agent, hence Uber may be sued by the third party for the accident caused by the driver (Lipton,2019). Uber drivers act on behalf of the Uber Company, hence in the instance of an accident the company may be liable. However, the company is only liable to the extent where the actions of the agent are within the scope of the agreement.
Given the case of the drunk driver, the principal may be held liable as the agent violated the code of conduct. In such a case, the agent and the principle are both responsible for the negligence. The family of a deceased person who lost his or her life in an uber accident is required to file a complaint against both the driver and Uber. It is recommended that the family seeks legal representation given that Uber is a big company and may override the case at hand.
To limit the actions of its drivers, Uber has to take steps that limit its exposure for the conduct of its drivers. Ostensible actions are placed to motivate the driver to act prudence to their conscience particularly when the issue at hand appears true (Di Amato, 2016).
The principal-agent relationship will most likely limit Uber’s exposure given that the principal is set to provide governing instructions to the agent. In an instance an agent work outside the actions, such as rushing a passenger to hospital during an accident, the efforts may go unrecognized.
It is required that the terms of the agreement be observed by both parties, the principle, and the agency, to minimize avoidable accidents that may be as a result of negligence from either party.
References
Di Amato, A. (2016). Uber and the sharing economy. Italian LJ, 2, 177.
HG.org. (2020). When Can an Employer be Found Liable for an Act of an Employee? HG.org Legal Resources. https://www.hg.org/legal-articles/when-can-an-employer-be-found- liable-for-an-act-of-an-employee-34389
Jennings, M. M. (2016). Business: It’s legal, ethical, and global environment. Cengage Learning.
Lipton, J. D. (2019). Are Literary Agents (Really) Fiduciaries? Tennessee Law Review, 86.
