if a person dealing with an agent knows or has reason to believe that the transaction is contrary to the commercial interests of the representative`s principal, it is probably very difficult for that person to assert, with a credible assertion, that he believed that the agent had obvious authority, and the absence of such a belief would be fatal to an allegation he made. In this context, the CC found, during the BSB review, that the parties had accepted arbitration, that the names of the parties had been indicated without explicitly mentioning the names of its representatives. The BSBs were also signed with unreadable signatures, without specifying the names of these signatories. Accordingly, the Court found that the BSB`s signatures were attributed to the legal representatives of the parties, in accordance with the above principles of law, and that their conciliation agreement was valid as such and that the national courts were not competent in the dispute. The obvious authority is effective only until the third party is placed on this, that the obvious power might not exist. Different states will interpret the doctrine of apparent authority in different ways. On 29.01.2015, the Tribunal issued its judgment, which dismissed the applicant`s case, as the parties had agreed to settle their disputes through arbitration. In the event of a breach of contract, obvious authority is often a problem. If the apparent power did not exist at that time, the client is not legally bound by the contract with the contractor, unless the client ratifies the contract. In addition, the parties must ensure that only the authorized person whose name is indicated in the agreement must actually sign the agreement, otherwise they may face challenges to the authority of the signatories and, therefore, under the agreement. The doctrine of apparent authority is based on the concept of Estoppel, thus preventing the client from denying the existence of a decision with respect to a third party, provided that he has made a representation of the agent`s authority to the third party, either by his words or by his actions. A party wishing to invalidate the arbitration agreement as a ground for quashing an arbitration award may argue that the signatory to the arbitration agreement did not have the power to accept the conciliation of the undertaking.
The most common scenario that leads to such a request is when the signatory of the arbitration agreement is not the manager of the limited liability company and does not have the necessary clearance to link the company to the compromise clause. It is not uncommon for the same situation, in which apparent authority is granted, to necessarily grant real authority. More information about apparent authority can be found in this article on the Louisiana Law Review, in this Marquette Law Review and in this article on the University of Florida Law Review.