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Project 7

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Project 7.8's purpose is to provide an understanding of a principal’s liability in creating an agency.

Hint: Drawing stick figures to represent the scenario helps to better understand the facts.

Better Coast Living operates as property management firm to collect rent from renters of recreational/vacation cottages for the various owners. BCL employs several representatives to assist in the accounts, however Catherine is not one of the authorized representatives. Catherine is one of the firm’s bookkeepers. Catherine noticed that one of their renters, Stan, who regularly rented a summer cottage for three consecutive weeks regularly paid in cash. However, the owner reduced the current summer rate by

10% due to the cottage’s aging structure. The renter, Stan, however, was not aware of the reduction.

Catherine called Stan as a representative of BCL from her office phone and reminded Stan of the payment and asked him to pay her directly at the office. Indeed, Catherine is a representative of BCL but not authorized to collect payments. However, Stan reasonably thought she was the proper customer representative and paid in cash at the office but for the incorrect amount. Catherine deposited the accurate amount but personally kept the overage of 10%

 

QUESTION: Is Better Coast Living civilly liable for Catherine’s tort (fraud) in taking the extra money?

Review the nature of agency law as it applies here, that is, whether or not a principal is responsible for the agent's acts.

You must quote from the textbook the relevant section(s) to support EACH of your answer(s). NO POINTS

for this Category will be awarded without the appropriate, supporting quote(s).

In your discussion, discuss the following

(i) Agent Self-Dealing;:

(ii) Agent Usurping an Opportunity;

(iii) For intentional torts such as fraud, a principal is generally not liable to third parties for actions committec outside the principal's scope of business. However, a principal is liable for the intentional fraud made by an agent within the scope of her employment.

Discuss the facts to help determine whether the agent's action fell within or outside the scope of her employment:

+ Was the act requested by the principal? Explain

+ Was the act the type that the agent was employed to perform? Explain

+ Did the act occur substantially within the time period of employment authorized by the principal?

Explain.

+ Did the act occur substantially within the location of employment authorized by the employer? Explain.

+ Was the agent advancing the principal's purpose when the act occurred? (It helps to describe the

principal's purpose) Explain.

(In your response, make sure you have answered the main question, "Is Better Coast Living civilly liable for

Catherine’s tort (fraud) in taking the extra money?")

NOTE: Do NOT discuss the criminal nature of this action.

NOTE: DO NOT DISCUSS CONTRACT AUTHORITY as there is no contract here.

 

Your answers will be grade upon their quality (QUALITATIVELY GRADED

 

You must quote from the textbook the relevant section(s) to support EACH of your answer(s). NO POINTS

for this Category will be awarded without the appropriate, supporting quote(s).

 

CAUTION: Your posts must remain on-topic for full points. If your post(s) discuss matters not directly

related to "Agency" your post(s) will NOT score points.

 

(The phrase “qualitatively graded” means that a review of the student’s work will emphasize the ability to analyze facts,

gencrate and organize ideas, defend opinions. make comparisons, draw inferences, evaluate arguments (read the questions

accurately} and solve problems.

 

Thus, to score points in projects that will be qualitatively graded. your posts must interpret, analyze, and evaluate the project's

purpose and questions. It must through proper resources explain the evidential, conceptual. and contextual considerations

upon which your judgment is based).