Apparent authority is a legal notion in which a reasonable person would perceive that someone who lacks actual authority has a temporary ability to act in a specific scenario.
In the case of corporate directors and officers, apparent authority is often referred to as ostensible authority. An office manager, for example, is not a company’s managing director, but it’s assumed that they have the ability to hire tradespeople to work on corporate property.
It’s especially important in business and constitutional law. A situation where a 3rd party would understand that an agent has the power to act is known as apparent authority. This means that even if the agent had no actual power, whether express or inferred, the principal is bound by the agency’s conduct. It creates estoppel since the third party is provided assurance on which he relies, and it would be unjust for the principal to refuse the power granted. Even if no actual authority has been given, legal authority can be found.
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