What characterizes a special agency relationship?

A special agency relationship is defined by a limited scope of authority granted to the agent by the principal. In this type of relationship, the agent is authorized to perform specific tasks or functions on behalf of the principal, usually within a clearly outlined set of expectations. This limited authority means that the agent can only act within the parameters set forth by the principal, making it distinct from other types of agency relationships where the authority may be broader or more permanent.

For instance, a real estate agent acting on behalf of a homeowner has the authority to sell the property, but that authority is confined to the terms stipulated in the agreement. This ensures that the agent's actions are tightly aligned with the principal's intentions and limits the agent's power to "yes or no" decisions regarding the sale, rather than enabling them to act in other areas without permission.

In contrast, other options such as unlimited authority, shared authority, or permanent authority do not characterize a special agency relationship. Unlimited authority would imply a broader range of actions beyond the specific tasks assigned, shared authority would suggest collaboration among agents which may not fit the traditional definition of a special agency, and permanent authority suggests that an agent can act indefinitely without the need for the principal's approval, which does not adhere to the