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A company previously allowed a claims manager to settle small warranty disputes. On Monday, the company emailed a customer, "The manager no longer has authority to settle your claim; only our general counsel may do so." On Tuesday, the manager signed a settlement with the customer anyway.
Which statement is most accurate?

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The principal remains bound because apparent authority can never be terminated. The principal is bound unless the agent signed a sworn statement admitting termination. The principal is not bound because the third party received direct notice before contracting that the agent's authority had been terminated. The principal is bound because termination of actual authority is irrelevant to everyone.

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