Express Actual Authority to Make an Offer a Third-Party Can't Refuse

1. Tom Hagen meets with Woltz, a movie producer. Tom states to Woltz that he works for a friend of Johnny Fontaine’s who would give his undying friendship to Woltz if he casts Fontaine in his upcoming film. Because Woltz has notice that Tom is acting for a principal, but has no notice of the principal’s identity, Don Corleone is an partially disclosed principal. REST. (2d) AGENCY § 4. Had Woltz accepted the Don’s offer of undying friendship, and the Don failed to perform, Tom might be personally liable for the breach. REST. (2d) AGENCY § 321.

Woltz investigates the identity of the principal and discovers that it is Don Corleone. The Don is now a fully disclosed principal and Tom drops out of any contract to take place. REST. (2d) AGENCY §§ 4, 320. However, Woltz refuses the Don’s offer. As a result, Tom, acting within the scope of his authority as consigliere, has Woltz’s prize horse decapitated and placed in Woltz’s bed. Tom is not relieved of liability in tort simply because he acts as an agent on behalf of the Don. REST. (2d) AGENCY § 343. However, law-in-action suggests that Woltz will not sue either Tom or the Don because he would likely end up dead.

2. Sollozzo (“the Turk”) meets with Don Corleone to solicit his investment in a narcotics-distribution venture. The Don refuses, but is concerned with the Turk’s involvement with the Tattaglia Family. To this end, the Don sends Luca Brasi to investigate the Turk’s connections with the Tattaglia Family. He instructs Brasi to represent to agents of the Tattaglias that he is dissatisfied with his current employment and might be interested in making a change. Because he is acting within the scope of his express actual authority, any representations to this effect would not violate his duty of loyalty to the Don. REST. (2d) AGENCY § 385, 394 (duty not to act for persons with conflicting interests variable by agreement). The Tattaglia Family does not believe Brasi, instead electing the equitable remedy of sending him to sleep with the fishes.

However, were the Tattaglia Family to rely on this representation and hire Brasi as an enforcer, an agency relationship would have been created between Brasi and the Tattaglia Family. While Brasi could argue that there was no actual consent to act on behalf of the Tattaglia Family, his actions would probably be a “manifestation of consent” upon which the Tattaglia Family could reasonably rely. REST. (2d) AGENCY § 1. As a result, Brasi would be breaching his fiduciary duties to the Tattaglia Family. REST. (2d) AGENCY §§ 394 (duty not to act during period of agency for persons whose interests conflict with the principal), 395 (duty not to disclose confidential information acquired during course of agency relationship). As a result, the Don would be liable to the Tattaglia family for Brasi's actions as the Don's agent. See Food Lion, Inc. v. Capital Cities/ABC, Inc., 194 F.3d 305 (4th Cir. 1999). Hence, the Tattaglias' self-help remedy of attempting to whack the Don would be reasonable, albeit a strategic blunder in the long run.