Jamie Paliath worked as a real estate agent for Home Town Realty of Vandalia, LLC (the principal, a real estate broker). Torri Auer, a California resident, relied on Paliath’s advice and assistance to buy three rental properties in Ohio. Before the sales, Paliath represented that each property was worth approximately twice as much as what Auer would pay and that there was a waiting list of prospective tenants. Paliath also stated that all of the property needed work and agreed to do the work for a specified price. Nearly a year later, substantial work was still needed, and only a few of the units had been rented. Auer sued Paliath and Home Town Realty for fraudulent misrepresentation. 1. Were Paliath’s representations to Auer within the scope of her employment? Explain. Will the court hold the principal (Home Town Realty) liable for the misrepresentations of the agent (Paliath)? 2. What is the ethical basis for imposing vicarious liability on a principal for an agent’s tort?
> Thomas Persson and Jon Nokes founded Smart Inventions, Inc., to market household consumer products. The success of their first product, the Smart Mop, continued with later products, which were sold through infomercials. Persson and Nokes were the firm’s
> Oxy Corp. is negotiating with the Wick Construction Co. for the renovation of the Oxy corporate headquarters. Wick, the owner of the Wick Construction Co., is also one of the five members of Oxy’s board of directors. The contract terms are standard for t
> Cummings, Okawa, and Taft are recent college graduates who want to form a corporation to manufacture and sell personal computers. Peterson tells them he will set in motion the formation of their corporation. First, Peterson makes a contract with Owens fo
> Blushing Brides, LLC, a publisher of wedding-planning magazines in Columbus, Ohio, opened an account with Gray Printing Co. in July 2000. On behalf of Blushing Brides, Louis Zacks, the firm’s member-manager, signed a credit agreement that identified the
> Siloam Springs Hotel, LLC, operates a Hampton Inn in Siloam Springs, Arkansas. Siloam bought insurance from Century Surety Co. to cover the hotel. When guests suffered injuries due to a leak of carbon monoxide from the heating element of an indoor swimmi
> Fadal Machining Centers, LLC, and MAG Industrial Automation Centers, LLC, sued a New Jersey–based corporation, Mid-Atlantic CNC, Inc., in federal district court. Ten percent of MAG was owned by SP MAG Holdings, a Delaware LLC. SP MAG had six members, inc
> James Williford, Patricia Mosser, Marquetta Smith, and Michael Floyd formed Bluewater Logistics, LLC, to bid on construction contracts after Hurricane Katrina struck the Gulf Coast. Under Mississippi law, every member of a member-managed LLC is entitled
> Walter Van Houten and John King formed 1545 Ocean Avenue, LLC, with each managing 50 percent of the business. Its purpose was to renovate an existing building and build a new commercial building. Van Houten and King quarreled over many aspects of the wor
> New York resident Esther Braunstein worked as an usher at Lincoln Center, held an administrative position with Citibank, was a school crossing guard, and assisted disabled persons and others as a volunteer on Roosevelt Island and at the New York Foundlin
> Holiday Isle Resort & Marina, Inc., operated four restaurants, five bars, and various food kiosks at its resort in Islamorada, Florida. Holiday entered into a “joint venture agreement” with Rip Tosun to operate a fifth restaurant called Rip’s—A Place for
> Joe, a resident of New Jersey, wants to open a restaurant. He asks his friend Kay, who is an experienced attorney and a New Yorker, for her business and legal advice in exchange for a 20 percent ownership interest in the restaurant. Kay helps Joe negotia
> Faraway Corp. supplies business equipment. Faraway is considering entering into two contracts, one with a joint stock company east of the Mississippi River and the other with a business trust formed by a number of sole proprietors on the West Coast. Both
> John, Lesa, and Trevor form a limited liability company. John contributes 60 percent of the capital, and Lesa and Trevor each contribute 20 percent. Nothing is decided about how profits will be divided. John assumes that he will be entitled to 60 percent
> Elliot Willensky and Beverly Moran formed a partnership to buy, renovate, and sell a house. Moran agreed to finance the effort, which was to cost no more than $60,000. Willensky agreed to oversee the work, which was to be done in six months. Willensky li
> Leisa Reed and Randell Thurman lived together in Spring City, Tennessee. Randell and his father, Leroy, formed a cattle-raising operation and opened a bank account in the name of L&R Farm. Within a few years, Leroy quit the operation. Leisa and Randell e
> Karyl Paxton asked Christopher Sacco to work with her interior design business, Pierce Paxton Collections, in New Orleans. At the time, they were in a romantic relationship. Sacco was involved in every aspect of the business—bookkeeping, marketing, and d
> Dan and Lori Cole operated a Curves franchise exercise facility in Angola, Indiana, as a partnership. The firm leased commercial space from Flying Cat, LLC, for a renewable three-year term. The Coles renewed the lease for a second three-year term. Two ye
> Patricia Garcia and Bernardo Lucero were in a romantic relationship. While they were seeing each other, Garcia and Lucero acquired an electronics service center, paying $30,000 each. Two years later, they purchased an apartment complex. The property was
> Karl Horvath, Hein Rüsen, and Carl Thomas formed a partnership, HRT Enterprises, to buy a manufacturing plant. Rüsen and Thomas leased the plant to their own company, Merkur Steel. Merkur then sublet the premises to other companies owned by Rüsen and Tho
> Victor Nacim had a checking account at Compass Bank. The “Deposit Agreement” required him to report an unauthorized transaction within thirty days of his receipt of the statement on which it appeared to obtain a recredit. When Nacim moved to a new reside
> Dorinda, Luis, and Elizabeth form a limited partnership. Dorinda is a general partner, and Luis and Elizabeth are limited partners. Discuss fully whether each of the separate events below constitutes a dissolution of the limited partnership. (See Limited
> Daniel is the owner of a chain of shoe stores. He hires Rubya to be the manager of a new store, which is to open in Grand Rapids, Michigan. Daniel, by written contract, agrees to pay Rubya a monthly salary and 20 percent of the profits. Without Daniel’s
> In August 2004, Ralph Vilardo contacted Travel Center, Inc., in Cincinnati, Ohio, to buy a trip to Florida in December for his family. Vilardo paid $6,900 to David Sheets, the sole proprietor of Travel Center. Vilardo also paid $195 to Sheets for a separ
> The franchise agreement of Domino’s Pizza, L.L.C., sets out operational standards, including safety requirements, for a franchisee to follow but provides that the franchisee is an independent contractor. Each franchisee is free to use its own means and m
> JTH Tax, Inc., doing business as Liberty Tax Service, provides tax preparation and related loan services throughout the United States in more than two thousand company- owned and franchised stores. Liberty’s agreement with its franchisees reserved the ri
> George Oshana and GTO Investments, Inc., operated a Mobil gas station franchise in Itasca, Illinois. In 2010, Oshana and GTO became involved in a rental dispute with Buchanan Energy, to which Mobil had assigned the lease for the gas station facility. In
> Kubota Tractor Corp. makes farm, industrial, and outdoor equipment. Its franchise contracts allow Kubota to enter into dealership agreements with “others at any location.” Kejzar Motors, Inc., is a Kubota dealer in Nacogdoches and Jasper, Texas. These tw
> C.B. Management, Inc., had a franchise agreement with McDonald’s Corp. to operate McDonald’s restaurants in Cleveland, Ohio. The agreement required C.B. to make monthly payments of certain percentages of the gross sales to McDonald’s. If any payment was
> National Foods, Inc., sells franchises to its fast-food restaurants, known as Chicky-D’s. Under the franchise agreement, franchisees agree to hire and train employees strictly according to Chicky-D’s standards. In addition, Chicky-D’s regional supervisor
> Maria, Pablo, and Vicky are recent college graduates who would like to go into business for themselves. They are considering purchasing a franchise. If they enter into a franchising arrangement, they would have the support of a large company that could a
> Stephen Patterson held an account with Suntrust Bank in Alcoa, Tennessee. Juanita Wehrman —with whom Patterson was briefly involved in a romantic relationship—stole his debit card and used it for sixteen months (well beyond the length of their relations
> Shane Dawson, a male homosexual, worked for Entek International. Some of Dawson’s co-workers, including his supervisor, made derogatory comments about his sexual orientation. Dawson’s work deteriorated. He filed a complaint with Entek’s human resources d
> Jamel Blanton, a male employee at a Pizza Hut restaurant operated by Newton Associates, Inc., in San Antonio, Texas, was subjected to sexual and racial harassment by the general manager, who was female. Newton had a clear, straightforward antidiscriminat
> Cynthia Horn worked for Knight Facilities Management–GM, Inc., in Detroit, Michigan, as a janitor. When Horn developed a sensitivity to cleaning products, her physician gave her a “no exposure to cleaning solutions” restriction. Knight discussed possible
> Beginning in 1986, Paul Rangel was a sales professional for pharmaceutical company Sanofi- Aventis U.S., LLC (S-A). Rangel had satisfactory performance reviews until 2006, when S-A issued new expectations guidelines with sales call quotas and other stand
> Billie Bradford worked for the Kentucky Department of Community Based Services (DCBS). One of Bradford’s co-workers, Lisa Stander, routinely engaged in extreme sexual behavior (such as touching herself and making crude comments) in Bradford’s presence. B
> Burlington Coat Factory Warehouse, Inc., had a dress code that required male sales clerks to wear business attire consisting of slacks, shirt, and necktie. Female salesclerks, by contrast, were required to wear a smock so that customers could readily ide
> Gina Gomez, a devout Roman Catholic, worked for Sam’s Department Stores, Inc., in Phoenix, Arizona. Sam’s considered Gomez a productive employee because her sales exceeded $200,000 per year. The store gave its managers the discretion to grant unpaid leav
> Discuss fully whether either of the following actions would constitute a violation of Title VII of the Civil Rights Act. 1. Tennington, Inc., is a consulting firm with ten employees. These employees travel on consulting jobs in seven states. Tennington
> Beverly Tull had worked for Atchison Leather Products, Inc., for ten years when she began to complain of hand, wrist, and shoulder pain. Atchison recommended that she contact a certain physician. In April 2000, the physician diagnosed the condition as c
> Carol Garcia and Pedro Salgado, bus drivers for Latino Express, Inc., a transportation company, began soliciting signatures from other drivers to certify the Teamsters Local Union No. 777 as the official representative of the employees. Latino Express fi
> Adley Abdulwahab (Wahab) opened an account on behalf of W Financial Group, LLC, with Wells Fargo Bank. Wahab was one of three authorized signers on the account. Five months later, Wahab withdrew $1,701,250 from W Financial’s account to buy a cashier’s ch
> Fior Ramirez worked as a housekeeper for Remington Lodging & Hospitality, a hotel in Atlantic Beach, Florida. After her father in the Dominican Republic suffered a stroke, she asked her employer for time off to be with him. Ramirez’s manager, Katie Berko
> SDBC Holdings, Inc., acquired Stella D’oro Biscuit Co., a bakery in New York City. At the time, a collective bargaining agreement existed between Stella D’oro and Local 50 of the Bakery, Confectionary, Tobacco Workers and Grain Millers International Unio
> Li Li worked for Packard Bioscience, and Mark Schmeizl was her supervisor. In March 2000, Schmeizl told Li Li to call Packard’s competitors, pretend to be a potential customer, and request “pricing information and literature.” Li Li refused to perform th
> As a safety measure, Dynea USA, Inc., required an employee, Tony Fairbanks, to wear steeltoed boots. One of the boots caused a sore on Fairbanks’s leg. The skin over the sore broke, and within a week, Fairbanks was hospitalized with a methicillin-resista
> Misty Cumbie worked as a waitress in Vita Café in Portland, Oregon. The café was owned and operated by Woody Woo, Inc. Woody Woo paid its servers an hourly wage that was higher than the state’s minimum wage, but the servers were required to contribute th
> Denton and Carlo were employed at an appliance plant. Their job required them to do occasional maintenance work while standing on a wire mesh twenty feet above the plant floor. Other employees had fallen through the mesh, and one was killed by the fall.
> Calzoni Boating Co. is an interstate business engaged in manufacturing and selling boats. The company has five hundred nonunion employees. Representatives of these employees are requesting a four-day, ten-hours-per-day workweek, and Calzoni is concerned
> Terry Holden’s stepmother, Rosie, was diagnosed with amyotrophic lateral sclerosis (ALS), and Terry’s wife, Susan, became Rosie’s primary caregiver. Rosie executed a durable power of attorney appointing Susan as her agent. Susan opened a joint bank accou
> Nelson Ovalles worked as a cable installer for Cox Rhode Island Telecom, LLC, under an agreement with a third party, M&M Communications, Inc. The agreement stated that no employer-employee relationship existed between Cox and M&M’s technicians, including
> Debbie Brooks and Martha Tingstrom lived together. Tingstrom handled their finances. For five years, Brooks did not look at any statements concerning her accounts. When she finally reviewed the statements, she discovered that Tingstrom had taken $85,500
> William and Maxine Miller, shareholders of Claimsco International, Inc., filed a suit in an Illinois state court against the other shareholders, Michael Harris and Kenneth Hoxie, as well as John Verchota, the accountant who worked for all of them. The Mi
> Basic Research, L.L.C., advertised its products on television networks owned by Rainbow Media Holdings, Inc., through an ad agency, Icebox Advertising, Inc. As Basic’s agent, Icebox had the express authority to buy ads from Rainbow on Basic’s behalf, but
> Thomas Huskin and his wife entered into a contract to have their home remodeled by House Medic Handyman Service. Todd Hall signed the contract as an authorized representative of House Medic. It turned out that House Medic was a fictitious name for Hall H
> Taser International, Inc., develops and makes video and audio recording devices. Steve Ward was Taser’s vice president of marketing when he began to explore the possibility of developing and marketing devices of his own design, including a clip-on camera
> Stephen Hemmerling was a driver for the Happy Cab Co. Hemmerling paid certain fixed expenses and abided by a variety of rules relating to the use of the cab, the hours that could be worked, and the solicitation of fares, among other things. Rates were se
> Springer, who was running for Congress, instructed his campaign staff not to purchase any campaign materials without his explicit authorization. In spite of these instructions, one of his campaign workers contracted with Dubychek Printing Co. to print so
> Monica Sexton filed a petition for Chapter 13 reorganization. One of her creditors was Friedman’s Jewelers. Her petition misclassified Friedman’s claim as $800 of unsecured debt. Within days, Friedman’s filed proof of a secured claim for $300 and an unse
> Grace Tarnavsky and her sons, Manny and Jason, bought a ranch known as the Cowboy Palace in March 2011. The three orally agreed to share the business for five years. Grace contributed 50 percent of the investment, and each son contributed 25 percent. Man
> Carlos Del Rey decided to open a fast-food Mexican restaurant and signed a franchise contract with a national chain called La Grande Enchilada. Under the franchise agreement, Del Rey purchased the building, and La Grande Enchilada supplied the equipment.
> Amaani Lyle, an African American woman, took a job as a scriptwriters’ assistant at Warner Brothers Television Productions. She worked for the writers of Friends, a popular, adult-oriented television series. One of her essential job duties was to type de
> Rick Saldona began working as a traveling salesperson for Aimer Winery in 1994. Sales constituted 90 percent of Saldona’s work time. Saldona worked an average of fifty hours per week but received no overtime pay. In June 2017, Saldona’s new supervisor, C
> Lynne Meyer, on her way to a business meeting and in a hurry, stopped by a Buy-Mart store for a new car charger for her smartphone. There was a long line at one of the checkout counters, but a cashier, Valerie Watts, opened another counter and began load
> Three months ago, Janet Hart’s husband of twenty years died of cancer. Although he had medical insurance, he left Janet with outstanding medical bills of more than $50,000. Janet has worked at the local library for the past ten years, earning $1,500 per
> Paul Barton owned a small property-management company, doing business as Brighton Homes. In October, Barton went on a spending spree. First, he bought a Bose surround-sound system for his home from KDM Electronics. The next day, he purchased a Wilderness
> RPM Pizza, Inc., issued a check for $96,000 to Systems Marketing for an advertising campaign. A few days later, RPM decided not to go through with the deal and placed a written stop-payment order on the check. RPM and Systems had no further contact for m
> James Thomas and Jennifer Clark married and had two children. They bought a home in Ironton, Ohio, with a loan secured by a mortgage. Later, they took out a second mortgage. On their divorce, the court gave Clark custody of the children and required Clar
> Dale Emerson served as the chief financial officer for Reliant Electric Company, a distributor of electricity serving portions of Montana and North Dakota. Reliant was in the final stages of planning a takeover of Dakota Gasworks, Inc., a natural gas dis
> William Sharp was the sole shareholder and manager of Chickasaw Club, Inc., an S corporation that operated a popular nightclub of the same name in Columbus, Georgia. Sharp maintained a corporate checking account but paid the club’s employees, suppliers,
> The city of Papagos, Arizona, had a deteriorating bridge in need of repair on a prominent public roadway. The city posted notices seeking proposals for an artistic bridge design and reconstruction. Davidson Masonry, LLC—owned and managed by Carl Davidson
> What duties do agents and principals owe to each other?
> What are the four most common types of electronic fund transfers?
> How does a mechanic’s lien assist creditors?
> If two parties have perfected security interests in the collateral of the debtor, which party has priority to the collateral on the debtor’s default?
> How do agency relationships arise?
> What is the difference between an employee and an independent contractor?
> What type of check does a bank agree in advance to accept when the check is presented for payment?
> Michael and Dianne Shankle divorced. An Arkansas state court ordered Michael to pay Dianne alimony and child support, as well as half of the $184,000 in their investment accounts. Instead, Michael withdrew more than half of the investment funds and spent
> What certification requirements does the Sarbanes-Oxley Act impose on corporate executives?
> What are the two major statutes regulating the securities industry?
> What is meant by the term securities?
> What is a voting proxy?
> What are the duties of corporate directors and officers?
> What four steps are involved in bringing a corporation into existence?
> What is a close corporation?
> What advantages do limited liability companies offer to businesspersons that are not offered by sole proprietorships or partnerships?
> What are the key differences between the rights and liabilities of general partners and those of limited partners?
> What is meant by joint and several liability? Why is this often considered to be a disadvantage of the partnership form of business?
> Like many students, Barbara Hann financed her education partially through loans. These loans included three federally insured Stafford Loans of $7,500 each ($22,500 in total). Hann believed that she had repaid the loans, but later, when she filed a Chapt
> Gary goes grocery shopping and carelessly leaves his checkbook in his shopping cart. His checkbook, with two blank checks remaining, is stolen by Dolores. On May 5, Dolores forges Gary’s name on a check for $100 and cashes the check at Gary’s bank, Citiz
> What are the three essential elements of a partnership?
> What are the most common types of franchises?
> What are three defenses to claims of employment discrimination?
> What federal act prohibits discrimination based on age?
> What is required to establish a prima facie case of disparate-treatment discrimination?
> What federal statute gave employees the right to organize unions and engage in collective bargaining?
> What are the two most important federal statutes governing immigration and employment today?
> What federal statute governs working hours and wages?
> How does a Chapter 13 bankruptcy differ from bankruptcy under Chapter 7 and Chapter 11?
