Attorney’s Apparent Authority to Sign Settlement Agreement

In Hogan v. Lagosz, 124 Conn App. 602 (2010) (October 26, 2010), the Appellate Court reiterated the rules of apparent authority in this action to enforce a settlement agreement signed by the defendant’s attorney. The defendant argued on appeal that the trial court had improperly concluded that her lawyer possessed apparent authority to act on her behalf. The Appellate Court affirmed the decision of the trial court, holding that the lower court properly concluded that the defendant by her conduct, interpreted in light of the surrounding circumstances, caused the belief on the part of the plaintiff that the attorney had the requisite authority to sign the agreement on her behalf.

THE LAW: An agent’s authority may be actual or apparent. Apparent authority is that semblance of authority which a principal, through his own act or inadvertences, causes or allows third persons to believe his agent possesses. Consequently, apparent authority is to be determined, not by the agent’s own acts, but by the acts of the agent’s principal. The issue of apparent authority is one of fact to be determined based on two criteria: 1) it must appear from the principal’s conduct that the principal held the agent out as possessing sufficient authority to embrace the act in question, or knowingly permitted the agent to act as having such authority; 2) the party dealing with the agent must have, acting in good faith, reasonably believed, under all the circumstances, that the agent had the necessary authority to bind the principal to the agent’s action. Resolution of the factual issue of apparent authority requires the trier of fact to evaluate the conduct of the parties in light of all the surrounding circumstances.