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1. Andrea hired Jack to be the sales agent for her paintings. However, in a month's time, she terminated the agency with Jack. Harold, a customer who had dealt with Jack earlier, was not aware of the termination. Harold approached Jack to buy a painting and wrote him a check of $5,000, the advance payment for the painting which Jack promised would be delivered in two weeks. When Jack did not contact Harold later, Harold demanded that Andrea honor the contract, since Jack sold the picture as her agent. Which of the following is true of this situation?

A. Since Jack had apparent authority, Andrea is liable to honor his contract with Harold.

B. Harold's duty was to contact Andrea. His failure to do this removes her liability to honor the contract.

C. Jack had express authority as Andrea's agent, which is not terminated with the termination of their agency.

D. As Andrea terminated the agency with Jack in violation of his rights, Jack has the direct authority to sell her paintings.

2. Abel was employed as a security guard for Seep Corporation. Abel's job was to guard a fenced-in area and to use force to keep intruders from climbing the fence to enter the plant. His working hours were from 8:00 A.M. to 5:00 P.M. At about 11:00 P.M. one evening, Abel drove past his place of employment. He saw a teenager named Johnny climbing the outside of the fence that he guarded during the day. Angered by this violation of Seep's property rights and by the fact that Johnny had called him a "potbellied moron" only three days earlier, Abel stopped his car, ran up to the fence, pulled Johnny off of it, and beat him up. Johnny sues Seep Corporation for Abel's assault and battery (both intentional torts). Which of the following is most likely to be the court's verdict??

A. Seep's is directly liable because Abel was an employee of the corporation at the time of the incident.

B. Seep's is not liable because Abel didn't act within the scope of his employment.

C. Seep's is liable under the doctrine of respondeat superior, since Abel was an employee.

D. Seep's is not liable for the intentional torts committed by its employees.

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M93107421

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