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Penny owns and operates Penny and Associates, a local law firm (the firm). Through the firm, Penny handles bankruptcy and commercial law transactions. Some of

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Penny owns and operates Penny and Associates, a local law firm (the firm). Through the firm, Penny handles bankruptcy and commercial law transactions. Some of Penny's potential clients need help with criminal charges, an area of law in which Penny does not have much experience. Penny hired Abby, a criminal lawyer, to serve those clients. Penny paid Abby a base salary plus 25% of fees collected from clients that Abby represented. Penny also paid Abby a $250 bonus for clients that Abby brought into the firm. Penny supplied Abby with business cards but has not yet listed Abby as an attorney on the firm's website. After some months working with the firm, Abby discovered that Ral Kapone needed a criminal defense lawyer. One day, on her way to a meeting with Ral, Abby ran a red light and hit James. James' vehicle was totaled and he suffered a severe case of whip lash. Though shaken, Abby proceeded to her meeting with Ral. At the meeting, Abby learned that Ral was facing serious murder charges. Abby represented to Ral that she owned and operated the firm, described her services, and executed a contract with Ral agreeing to represent him on the murder charges for a $10,000 retainer plus hourly rates. Abby directed Ral to make all checks payable to her personally, starting with the $10,000 retainer. She received and cashed that check. After several weeks of promising to begin preparing for Ral's trial, Abby disappeared. Ral lost not only the retainer but--given that other attorneys charged triple Abby's rates, and Ral now lacked cash--any hope of developing a strong defense to the criminal charges. While pursuing legal remedies against Abby, Ral discovered that Penny owned the firm and confronted her. Penny professed ignorance of Abby's dealings with Ral and denied all responsibility. Ral brought suit against Abby and Penny. Meanwhile, James read about Ral's lawsuit in the paper and decides to pursue a personal injury lawsuit against both Abby and Penny. Analyze the rights and remedies of Penny, Abby, Ral and James under agency law

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