agency relationships

An agency relationship occurs when one person or entity, called the principal, authorizes another, called the agent, to act on their behalf. The agent has a duty to represent the principal’s interests and make decisions aligning with their goals. This relationship is common in situations like a company's owner (principal) hiring a manager (agent), or a person appointing a real estate agent to buy or sell property. The key idea is trust: the agent acts with authority and responsibility, but ultimately, their actions should benefit and reflect the principal’s intentions.