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Business Organizations
West Virginia University School of Law
Cowan, Barton Z.

CHAPTER 1
1.      Gorton v. Doty
o   Coach-Teacher-Wreck Case
o   Where one undertakes to transact some business or manage some affair for another by authority and on account of the latter, the relationship of principal and agent arises.
2.      Gay Jenson Farms Co. v. Cargill, Inc.
o   Cargill loaned money and took control of the day to day operations of Warren.
o   A creditor who assumes control of his debtor’s business may be held liable as principal for the acts of the debtor in connection with the business.
3.      Mill Street Church of Christ v. Hogan
o   Church hires Bill. Bill hired his brother Sam. Sam got hurt.
o   A person possesses implied authority as an agent to hire another worker where such implied authority is necessary to implement the agent’s express authority.
4.      Lind v. Schenley Industries, Inc.
o   Lind accepted a management position with Schenley Industries based on the assertion of a metro sales manager that he would receive bonus commission on sales.
o   An agent can bind a principal despite a lack of authority to do so if it would seem to a reasonable person that the agent possessed such authority.
5.      Three-Seventy Leasing Corporation v. Ampex Corporation
o   A salesperson at Ampex agreed to sell certain computers to 370 Corp despite not having been given the authority to do so.
o   A salesperson binds his employer to a sale if he agrees to that sale in a manner that would lead the buyer to believe that a sale had been sonsummated.
6.      Watteau v. Fenwick
o   Fenwick had authorized Humble as purchasing agent, but only for specific items, an authority Humble then exceeded.
o   When one holds out another as an agent, that agent can bind the principal on matters normally incident to such agency, even if he was not authorized for a particular type of transaction.
7.      Kidd v. Thomas A. Edison, Inc.
o   Edison, Inc. contended that agent Fuller had made agreements on its behalf with Kidd that exceeded Fuller’s authority.
o   An agent acting within the usual boundaries of his role binds his principal even if the details of the transaction to which he agrees were not authorized.
8.      Nogales Service Center  v. Atlantic Richfield Company
o   NSC contended that an agent of ARCO had agreed to certain pricing concessions, an agreement that ARCO contended he had not been authorized to make.
o   A principal can be bound by a general agent based on his position as such, even if he lacks express or apparent authority for the commitment at issue.
9.      Botticello v. Stefanovicz
o   Tenants in common sell farm. One agrees on price and makes deal. Other holds out. Buyer sues for specific performance when tenants refuse to honor agreement.
o   Marital status cannot in and of itself prove an agency relationship.
10. Hoddeson v. Koos Bros.
o   Furniture case. Salesman not really a salesman.
o   To establish agency by estoppels, the appearance of authority must be shown to have been created by the manifestations of the alleged principal and not solely by the supposed agent.
11. Atlantic Salmon A/S v. Curran
o   Atlantic Salmon sued Curran for a contract he supposedly made as agent of Boston International Seafood Exchange, but which in fact was made with Marketing Designs as a partially disclosed principal.
o   It is the duty of an agent, in order to avoid personal liability on a contract entered into on behalf of the principal, to disclose not only that he or she is acting in a representative capacity, but also the identity of the principal.
12. Humble Oil & Refining Co. v. Martin
o   Martin injured when a car rolled out of a service station owned by Humble sought to hold humble liable for the station operator’s negligence.
o   A party may be liable for a contractor’s torts if he exercises substantial control over the contractor’s operations.
13. Hoover v. Sun Oil Company
o   Hoover sought to hold franchisor Sun Oil responsible after he was injured in a fire at a service station franchise operated by Barone.
o  

Automotive solicited customers on his own behalf.
o   An agent who draws business away from his principal for his own enrichment is liable to the principal for his profits therefrom.
21. Town & Country House & Home Services, Inc. v. Newbery
o   Certain employees of Town & Country left, formed a competing company, and utilized customer lists they had obtained from their former employer.
o   Former employees may not use confidential customer lists belonging to their former employer to solicit new customers.
CHAPTER 2
22. Martin v. Peyton
o   Martin a creditor of the brokerage firm KN&K claimed that investments made by Peyton and his associates in KN&K made them partners in the firm.
o   The absence of an explicit partnership agreement does not preclude the creation of a partnership.
23. Young v. Jones
o   Young lost 550K after relying on false audit statements from Price Waterhouse-Bahamas sought to recover damages from Price Waterhouse-U.S.
o   A person who represents himself, or permits another to represent him, to anyone as a partner in an existing partnership or with others not actual partners, is liable to person to whom such a representation is made who has given credit to the actual or apparent partnership.
24. Meinhard v. Salmon
o   Meinhard sued co-adventurer for usurping an opportunity that should have been offered to the venture.
o   Joint adventurers owe one another the highest fiduciary duty of loyalty while the enterprise is ongoing.
25. Bane v. Ferguson
o   Bane had noncontributory retirement plan. Firm was caused to dissolve. Bane lost benefits sued for negligence.