Business Law and the Legal Environment

Business Law and the Legal Environment

QUESTION:

Read case scenario below and analyze.
Scenario: Brenda is purchasing agent for Commodities Corp. Dennis, a Commodities corporate officer, gave Brenda written authority to buy for Commodities Corporation as many computers and support devices as necessary. Dennis signed the written authority document. The next day, Dennis called Brenda and told her to buy only 50 notebook computers and nothing else.
Brenda went to E-Products, Inc. the next day, showed the written authority from Dennis to E-Products and entered into a written contract with E-Products to buy 60 notebook computers and a selection of printers and scanners to support the computers. E-Products promptly shipped the order to Commodities.
Dennis claims Commodities is not liable to E-Products for the sale because, Dennis claims Brenda exceeded her agency authority and thus was not acting as a Commodities agent in the purchase with E-Products.
A. Is Commodities liable to E-Products under the sales contract for the computers, printers and scanners? Why or why not?
B. Is Brenda personally liable to E-Products to pay for the computers, printers and scanners? Why or why not?
C. Is Brenda liable to Commodities for exceeding her agency authority and thus liable for paying Commodities for the purchases? Why or why not?

RESPONSE 1:(YOU NEED TO REPLY TO THIS RESPONSE
100-150 words)
A. Commodities is liable because Brenda had a written contract from Dennis that gave her the authority to purchase the products even though Dennis called the day after to tell her that she should only buy the 50 computers. As an agent she represents the company. (Advanced business law and legal environments 2014)
B. no Brenda isn’t liable to e-products for the products because the she was given written authority to buy whatever is necessary being a representative of commodities the company is liable and not Brenda (advanced business law and legal environments 2014)
C. This is a tough one because even though the written authority does specify she can buy whatever is necessary, Dennis did call her to tell to only buy limited items so being that she acted above her authority she is liable to commodities. (Advanced business law and legal environments 2014)

Reference
Unknown (Advanced Business law and legal environments 2014)

RESPONSE 2: (YOU NEED TO REPLY TO THIS RESPONSE
100-150 words)

A.) According to the textbook, an agency is created when a person or company agrees to act for or in place of another person or company. The principal creates authority in an agent, and the agent receives authority and carries out the principal’s instructions (Saylor: Business law and the legal environment. 2014). Commodities are not liable to E-products under the sales contract for the computers, printers and scanners because, one of the fiduciary duties of agents is “obedience and performance”. Agents are to perform in compliance with the principal’s instructions (Saylor: Business law and the legal environment. 2014). Additionally an agents duties is to act with reasonable care and skill, to perform as is “reasonable under the circumstances” (including emergencies) (Saylor: Business law and the legal environment. 2014). Brenda’s assignment was to buy only 50 notebook computers and nothing else as instructed by her principal Denis. When she went and deployed her orders and acted carelessly she breached the contract. Therefore commodities are not liable.

B.) Brenda is not personally liable to E-products to pay for the computers, printers and scanners, because when creating an agency a ratification is automatically implied or expressed by the principal, meaning a principal accepts responsibility for acts of an agent going beyond his/her authority (Saylor: Business law and the legal environment. 2014).

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