Business Associations Cases
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Teacher let coach borrow her car to carry athelets to the football game, they got into an accident. Court held that an agency relationship formed.
Warren defaulted on contracts made with farmers. Cargill as a large worldwide dealer took over the operations of Warren before the lawsuit. Court held that there was an agency relationship because Cargill took control over Warren.
Mill Street Church of Christ
Bill was hired to paint the church. Bill believed he had actual authority to hire someone to help him paint the church since he hired the same person, Sam, in the past. Church never told Bil that he could not hire Sam.
Three-Seventy Leasing Corp.
370 Leasing Corp sought damages from Ampex for breach of contract to sell computer core memories. Court held that there was apparent authority because it was reasonable for 370 to believe that Kays had actual authority because officer of the company said that all contracts should be handled through Kays. Therefore apparent authority existed.
- Even though defendant's owned Humble's shop, they did not want others to know owned it because they didn't want to lose the reputation Humble had in the community. Therefore there was an undisclosed principle.
- There was no actual authority because the principles told Humble not to buy cigars, Bovril, and some other items
- No apparent authority because the principle was undisclosed
- Court ruled that the defendant's should pay because they were the lowest cost avoider.
Love left her car at the filling station. hte car rolled of the premises and struck Mr. Martin and his children. Court looked at factors and determined that there was an employer-employee relationship. Schneider was more like a station manager, than like an owner. Schneider didn't have control. Therefore the principal was liable to the third party.
- A master-servant relationship exists where the servant has agreed:
- - to work on behalf of hte master and
- - subject to the master's control or right to control the "physical conduct" of the servant (that is, the manner in which the job is performed, as opposed to the result alone).
Sun Oil Company
Fire occurred at the service sation. It was started by one of Barone's employees. P tried to sue the emploee, Barone, and Sun Oil Co. Court held that Barone was an independent contractor because he exercised control of the business. Barone set his hours, he takes on the risk of economci loss as well as the upside potential.
- Independent Contractors
- - Agent type - one wh has agreed to act on beahlf of another, but is not subject to the principal's control over how the result is accomplished (that is, over the "physical conduct" of the task)
- - Non-agent type 8 one who operates independently and simply enters into arm's length transactions with others.
People were heckling the pticher and the pitcher threw the ball at the guy in the stands. The guy sues the pitcher and the ball club. If the fans were presently interfering with the pitcher's ability to do his job, it is within the scope of his employment. Court held that preparing for the game mentally is inside the scope of employment.
After determining whether there was an employer/employee relationship, see if the person was acting within the scope of employment.
General Automotive Manufacturing Co.
- Automotive brought an action against Singer, former employee, for secret profits received while in his employ.
- Court held that Singer should have brought the information to Automotive so that maybe they could have changed their business to take on that type of work.
- Automotive sued under hte fiduciary obligations of agents.
- Singer holds the money in constructive trust (whatever profits he made).
Chesire wanted to be paid more money at the beauty shop. Fenwick told her that he cannot increase her salary, but they made an agreement where if the company makes money then she would share the profit. She did not share in the losses. She terminated her employment. Court held that a partnership was not created.
- Meinhard and Salmon made an agreement where Salmon was to manage the hogel and Meinhard invested money into it.
- Salmon acquired property next to the hotel from having that hotel.
- (Gerry probably called the hotel to see if the owner wanted to buy the property)
- Salmon entered into an agreement with Gerry without telling Meinhard.
- Court held that Salmon owed a fiduciary duty and therefoore there was a breach of the partnership.
- (Salmon was the eyes and ears of the partnership)
- Salmon did not violate a contractual violationm but rather a fiduciary obligation.
- Remedy probably would have been how the partners would have intended it to be if Salmon told Meinhard. Therefore Meinhard would get the same amount (percentage wise) of what he got in Hotel Bristol.
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