What event can cause termination by operation of law in agency relationships?

The termination of an agency relationship by operation of law occurs when certain events make it impossible or inappropriate for the agency to continue, regardless of the initial agreement between the parties. One significant event that causes this type of termination is the death of either the agent or the principal.

When a principal dies, the agent typically loses the authority to act on behalf of that principal, as the agent's authority is directly tied to the principal's ability to give directives. Similarly, if the agent dies, they can no longer perform their duties. This automatic termination by operation of law ensures that the agency relationship cannot continue in a situation where one party is no longer able to fulfill their role, maintaining the integrity and mutual responsibility within the relationship.

While the completion of an agency task, mutual agreement, or changes such as a principal's address can also affect agency relationships, these do not constitute automatic terminations by operation of law. Instead, they result from voluntary actions or the natural conclusion of the agency's purpose.