Maria With Tippy Textiles, Essay Example

Is the sales agreement arranged by Maria with Tippy Textiles for the purchase of fabrics binding on Juana? Explain.

The issue posed in this scenario is that Juana had initially allowed her sister Maria to hold power as vice president for purchasing of the company, which enabled her to make purchasing decisions without first receiving approval from Juana. However, after Juana removed this power from Maria, she engaged in negotiations for a purchase that cost Juana’s company $1 million. The equal dignities rule states the legality of this concern. Juana is able to give Maria power without documentation if the sales that she allows has less than a $500 value. However, Juana had sent the relevant documentation to all partner companies to give her sister the power to make purchases and she had failed to notify these companies about Maria’s changed position. Therefore, Maria will win the dispute because her ability to make the purchase was supported by written documentation.

Is there a binding contract between Juana and Chris for the sale of Cal Fashions products?  Explain.

The issue at hand is that Juana sent her sister Isabel to meet with a potential business partner, but did not give her the ability to engage in any contract negotiation. However, Isabel engaged in contract negotiation regardless. Juana approved of these actions because she believed that she was getting a good deal. This contract is binding under the implied authority rule stating that “2. Agents have implied authority to do those things which are reasonably necessary to carry out the duties which the principal has expressly authorized the agent to perform”. While Isabel was not specifically given permission to engage in contract negotiation, she was aware of her sister’s business needs and therefore felt that it was reasonable to engage in a deal that her sister would be accepting of anyway. When Isabel returned home, she learned that this was indeed the case. Therefore, if Chris wished to break the contract for any reason, it is likely that the court would weigh in the favor of Juana and Isabel based on the circumstances of the scenario.

Juana did not receive payment for the house in Palm Springs.  She sued both Steve and Leonore for breach of contract.  Will they be held liable to Juana under the contract to purchase the house in Palm Springs?  Explain.

In this issue, Juana is attempting to sell a house. She is doing so through a realtor, who has managed to sell the house. However, the two recognize that the individual that the house was sold to was really a representative for another individual, and that the representative was misleading during this process. The rule pertaining to this case is ratification. Specifically, the rule states that “If an agent enters into a contract that the agent had no authority to make on behalf of the principal, the principal is not liable on that contract.  However the agent will be personally liable under such circumstances.” As a consequence Steve, the individual who was representing Leonore and actually bought the house will be held responsible for misleading Juana and her realtor. Leonore will not be held liable. Therefore, the court would rule in the favor of Juana and Melinda. However, if the action is ratified by Leonore at some point, Leonore will be held responsible. However, the law will continue to act in favor of Juana and Melinda.