The California Court of Appeals applied the theory of agency law to hotel management contracts in this case, in that the court held that “it is a cardinal principle of agency law that a principal who employs an agent always retains the power to revoke the agency.”
The Woolley appellate court decision relied on three points.
First, the court held that the relationship between the owners and Embassy Suites was one of agency and that the principal retains the unrestricted power to revoke the agent’s authority.
Second, the court held that the preliminary injunction “impermissibly called for specific enforcement of personal service contracts.”
Finally, the court held that Embassy did not demonstrate the inadequacy of an award of damages for the owners’ alleged wrongful termination [Renard and Motley].
