In what scenario can an agency relationship be terminated?

An agency relationship can be terminated in several ways, and one of the most common scenarios is through the expiration of a specified term or by mutual agreement between the principal and the agent.

When the agency is set for a limited duration, it automatically ends when that period elapses. Alternatively, both parties may agree to end the relationship before the predetermined time, which reflects a mutual understanding and agreement. This highlights the significance of mutual consent in the functioning of agency relationships, aligning with principles of cooperation and respect for the interests of both parties involved.

In contrast, other options present scenarios that are much more limited. For instance, stating that termination can only happen at the principal's discretion or limited to the agent's choice does not encompass the full scope of how agency relationships can be dissolved. Understanding the variety of ways in which an agency can be terminated, including mutual agreements and specific terms, is fundamental for anyone studying agency law.