Which authority pertains to actions taken by an agent that may not be explicitly stated but are necessary for performing their duties?

Implied authority refers to the powers that are not explicitly granted to an agent but are necessary for carrying out the responsibilities of their role. This concept is rooted in the understanding that agents, while acting on behalf of a principal, must have the ability to execute tasks that are vital to fulfilling their duties effectively, even if those specific actions are not directly outlined in their agreement.

For example, if a manager is authorized to run a department, they inherently possess the implied authority to make decisions such as hiring an assistant or purchasing office supplies, as these actions are typically necessary for the performance of their job. The doctrine of implied authority helps to ensure that agents can act in the best interest of their principals without needing constant explicit directions for every minor action.

Understanding implied authority is crucial, especially in business law, as it protects both the agent and the principal by allowing agents to operate flexibly and make decisions that align with the principal's goals. This recognition of implied authority supports smoother business operations and helps avoid conflicts that may arise from needing explicit approval for every minor decision taken by an agent.