Video: Formation of Agency

In this lesson, Nick Palazzolo, CPA, demystifies the intricacies of forming an agency, addressing the essential requirements such as mutual agreement, legal capacity of the involved parties, and the role of consideration in establishing such relationships. With a focus on practicality, Nick uses real-world scenarios to illustrate when and why an agency relationship might need to be put in writing, such as in real estate transactions or when actions extend over a year. He methodically explains the nuances between expressed and implied agreements while walking through relatable examples like employment duties and hiring a real estate agent. Moreover, he clarifies the legal capacity of the parties involved in an agency relationship, why certain roles, such as minors in real estate sales, are restricted, and when consideration might be necessary to solidify the relationship. Engaging and clear, this lesson is crafted to build a robust understanding of agency formation that feels right at home in real-life applications as well as on the CPA exam.