Case question:

Angela deals in the sale of quilts, both new and "pre-loved”. As Angela often accepts items on
consignment, the standard form agreement with her consigners states that she is entitled to
commission when she finds a buyer Greta gives Angela a beautiful quilt made by her
grandmother and Angela finds a buyer the very next day. Before the quilt has been sold Angela
receives a text message from Greta, telling her that, for) sentimental reasons, she wants to keep
the quilt and will come to collect it that afternoon. Can Angela sell the quilt, based on her rights
as agent?

Solve:
Issue: The main issue is whether Angela, as an agent, has the right to sell the quilt despite
receiving a text message from Greta expressing her desire to keep it for sentimental reasons.

Rule: The rule applicable here is the law governing agency relationships and the authority of an
agent to act on behalf of a principal. Specifically, we need to consider whether Angela's
authority to sell the quilt had been terminated by Greta's communication.

Application: Angela is acting as an agent for Greta in the sale of the quilt. As per the standard
form agreement, Angela is entitled to commission upon finding a buyer for the quilt. However,
the key factor is whether Angela's authority to sell the quilt has been terminated by Greta's text
message expressing her desire to keep the quilt for sentimental reasons.

The termination of an agent's authority can occur in several ways, including revocation by the
principal or operation of law. In this case, Greta's text message could be interpreted as a
revocation of Angela's authority to sell the quilt. If Greta's communication effectively terminates
Angela's authority before the sale is finalized, Angela may no longer have the right to sell the
quilt.

Conclusion: Based on the information provided, it appears that Greta's text message expressing
her desire to keep the quilt for sentimental reasons could be interpreted as a revocation of
Angela's authority to sell the quilt. This means that Angela may not have the right to sell the quilt
to the buyer, as her authority to act on Greta's behalf has been terminated before the sale was
completed.

In summary, Angela should not proceed with the sale of the quilt based on her rights as an
agent, as it seems that her authority to act on Greta's behalf has been revoked by Greta's
communication. However, the specific legal interpretation may vary depending on the
jurisdiction and the precise terms of the agency agreement. If Angela is unsure about the
legality of the situation, she should seek legal advice to ensure she is making the correct
decision.

Case question:
Sir Aldous Winterbourne III, a multi-millionaire property magnate, recently died at the age of
eighty-seven years and left his considerable estate to his daughter, Faith. In the twelve-month
period prior to his death, Faith employed Candy, a twenty-five year old nurse, to care for her
father on a full-time basis. A special relationship developed between Aldous and Candy, such
that he gave her a house, a sports car and some diamond jewelry. As Faith was not aware of
these gifts, she paid Candy a monthly salary for her services. Faith seeks your advice because
she would like to recover all the gifts from Candy. Faith maintains that her father was frail and
under Candy's influence when he gave her the expensive gifts.

Solve:
Issue: The main issue is whether Faith can recover the gifts that her late father, Aldous
Winterbourne III, gave to Candy, the nurse who cared for him, on the grounds that he was frail
and under Candy's influence at the time the gifts were made.

Rule: The relevant legal principles to consider here include the validity of gifts made by a donor
who may be vulnerable due to age, health, or undue influence. Additionally, the concept of
"undue influence" in gift transactions and the requirement for valid consideration (exchange of
something of value) in contracts.

Application:

Gifts Made by a Vulnerable Donor: If Faith can establish that her father, Aldous, was in a frail
state of health or otherwise vulnerable due to age or circumstances, it might be argued that the
gifts he made to Candy could be subject to challenge. Courts may be more willing to scrutinize
gifts made under such conditions, especially if they appear to be disproportionately large or
unexpected.

Undue Influence: Undue influence refers to situations where a person uses their position of
power or authority to manipulate another person into making a decision that they wouldn't have
made otherwise. If Faith can demonstrate that Candy exerted undue influence over Aldous to
receive the gifts, it might raise questions about the validity of the gifts. The fact that a special
relationship developed between Aldous and Candy during the time she was caring for him could
be a relevant factor.

Consideration: For a gift to be legally valid, there typically needs to be an intention to make a gift
(donative intent) and acceptance by the recipient. If the gifts were given in exchange for Candy's
services as a nurse, it might be argued that they were not true gifts but rather compensation for
her services. In such cases, consideration (something of value exchanged in a contract) might
be lacking.

Conclusion: Based on the information provided, Faith may have a legitimate legal basis to seek
the recovery of the gifts from Candy. The potential vulnerability of Aldous due to his age and
health, coupled with the special relationship that developed between Candy and Aldous during
her time as his nurse, could raise concerns about undue influence and the validity of the gifts.
Additionally, if the gifts were given in exchange for Candy's services, it might further challenge
their classification as true gifts.

Case question:
Rupert works as a personal assistant to a record producer, Tim Shaw. Tim is working long hours
to launch a new recording artist on the record label and asks Rupert to work on Sunday, his only
day off. Rupert agrees and works 7 days a week for 2 weeks to assist Tim. The launch of the
new recording artist is a huge success and is very profitable for the record company. At a launch
function, Tim promises Rupert a bonus of $1,000 for his hard work. Later that week, they argue
about an unrelated matter and Tim tells Rupert that he can forget about the bonus. Rupert
seeks your advice about whether he can sue Tim?

Solve:
Issue: The main issue is whether Rupert can sue Tim to enforce the promise of a $1,000 bonus
that Tim made to him for his hard work.

Rule: The relevant legal principles include the concepts of consideration, promissory estoppel,
and the enforceability of promises.

Application:

Consideration: In order for a promise to be legally binding, it generally needs to be supported by

consideration, which means there must be something of value exchanged between the parties.
Rupert agreed to work 7 days a week for 2 weeks to assist Tim, which can be considered valid
consideration for the promise of a bonus. Rupert's extra work can be seen as a benefit to Tim
and the record company.

Promissory Estoppel: Promissory estoppel is a legal doctrine that prevents a promisor (Tim)
from retracting a promise if the promisee (Rupert) has relied on that promise to their detriment.
In this case, Rupert worked extra hours based on Tim's promise of a $1,000 bonus. If Rupert
relied on Tim's promise and suffered a detriment (worked more than he otherwise would have),
promissory estoppel might apply to prevent Tim from reneging on his promise.

Conclusion: Based on the information provided, Rupert may have a valid legal claim against Tim
to enforce the promise of a $1,000 bonus. Rupert's extra work in assisting with the launch of the
new recording artist could be seen as valid consideration for the promise of the bonus.
Additionally, if Rupert relied on Tim's promise to his detriment (by working more hours than he
otherwise would have), promissory estoppel might prevent Tim from avoiding his promise.

Case question:
On 10 January, Martha wrote a letter to Jimmy offering to sell him her laptop computer for
$1,000. Jimmy received the letter on 11 January and he replied by letter accepting the offer.
Jimmy posted the letter of acceptance first thing on 12 January. On the afternoon of 12 January,
Jimmy changed his mind and decided that he didn't want to buy the laptop. He then sent a fax to
Martha saying: "Changed my mind, ignore letter of 12 January". Martha received the fax and
then sold the computer to Robert. On 14 January, Jimmy's letter of acceptance arrived. On 15
January Jimmy phoned Martha to say that he had changed his mind again and that he now
wants to buy the laptop. Is Martha in breach of a contract with Jimmy?

Solve:
Issue: The main issue is whether Martha is in breach of a contract with Jimmy regarding the
sale of the laptop computer.

Rule: The relevant legal principles include the formation of a contract, the communication of
acceptance, revocation of an offer, and the concept of a valid contract.

Application:

Formation of a Contract: For a contract to be formed, there must be an offer, acceptance,

consideration, and an intention to create legal relations. Martha made an offer to sell her laptop
computer to Jimmy for $1,000.

Communication of Acceptance: An acceptance of an offer is generally effective when it is

communicated to the offeror. In this case, Jimmy replied by letter accepting Martha's offer. The
"postal rule" may apply, which states that acceptance is effective upon posting, unless the offer
specifies a different mode of acceptance.

Revocation of Offer: An offeror can revoke their offer at any time before acceptance is
communicated. However, the revocation must also be communicated effectively to the offeree.
In this case, Jimmy sent a fax to Martha revoking his acceptance, but the key question is
whether this revocation was effective.

Conclusion:

Based on the information provided, it appears that a contract was formed between Martha and
Jimmy when Jimmy posted his acceptance letter in response to Martha's offer. According to the
"postal rule," acceptance is typically effective upon posting. Therefore, Martha may have already
been bound by a contract with Jimmy at the time she received his fax revoking his acceptance.

However, the effectiveness of Jimmy's fax revocation is questionable, as it was sent after his
acceptance had been communicated by post. This means that Martha may not have received
the revocation before the acceptance became effective.

Since Martha had already sold the laptop computer to Robert before Jimmy's revocation fax was
received, she might not be in breach of contract with Jimmy. Additionally, the subsequent phone
call from Jimmy on 15 January to express his desire to buy the laptop would likely not alter the
situation, given the events that had already transpired.
In conclusion, Martha may not be in breach of a contract with Jimmy, as a valid contract may
have already been formed before the attempted revocation took place.

Case question:
Sheree, the chief financial officer, is asked to sign off on an order for a new multimedia package
for the company for which she works. Reginald, the director of the multimedia company, asks
Sheree if she has approval to finalize the order. Jamie, the Human Resources manager,
interjects and states that Sheree is "basically the company secretary" and has authority to make
large company purchases. When the directors discover the purchase, they tell Reginald that the
purchase is invalid since Sheree is not officially the company secretary. Reginald argues that
there was a holding out that Sheree had the necessary authority. Discuss the assumptions third
parties are entitled to make and whether any assumptions apply here. Discuss applicable
statute and case law and explain whether Reginald is correct or not?

Solve:
Issue: The main issue is whether the directors' claim that the purchase is invalid due to Sheree's
lack of official authority is valid, considering the concept of "holding out" and third parties'
assumptions of authority.

Rule: The relevant legal principles involve the concept of "apparent authority" or "holding out,"
where a third party is entitled to assume that an agent has authority based on the actions,
statements, or conduct of the principal or the agent. This principle is often applied in the context
of agency law.

Application:

Assumptions Third Parties are Entitled to Make: In agency law, a third party is entitled to make
reasonable assumptions about an agent's authority based on the principal's actions, statements,
or conduct. This is known as the principle of "holding out." If a principal allows an agent to
appear as having authority, the principal may be bound by the agent's actions, even if the agent
doesn't actually possess the specific authority.

Applicable Statute and Case Law: The precise application of the principle of holding out may
vary depending on jurisdiction and case law. However, common law principles generally allow
third parties to rely on the apparent authority of an agent if the principal has given reason to
believe that the agent has the authority to act.

Conclusion:

In this case, Jamie, the Human Resources manager, explicitly stated that Sheree was "basically
the company secretary" and had authority to make large company purchases. This statement
could be seen as an act of "holding out" or creating an appearance of authority. If Reginald, the
director of the multimedia company, reasonably relied on Jamie's statement and the overall
context, he might have a valid argument that Sheree had apparent authority to finalize the
purchase.

Based on the principles of "holding out," it is possible that the directors' claim that the purchase
is invalid due to Sheree's lack of official authority might not hold strong if they had created a
situation where third parties, including Reginald, could reasonably assume that Sheree had the
necessary authority to make such decisions.

However, legal outcomes can be complex and may depend on various factors, including the
exact wording of Jamie's statement, the industry practices, and the jurisdiction's specific laws
and precedents. Reginald's argument that there was a holding out might have merit, but this
would require a thorough examination of the facts and legal principles by legal professionals.
.

Case question:
Over dinner one evening, Peter and Fred decide to each contribute $10,000 to form a
partnership to invest in a business venture. A written partnership agreement is drafted, which
includes a stipulation that all profits from the venture are to be shared equally between partners.
Fred invests an additional $5,000 to secure office premises and furniture for their venture. After
6 months, the business venture still has not commenced, and no profit has been made. Peter
asks Fred to refund his $10,000 contribution but Fred refuses since he has incurred debts and
liabilities. Peter argues that since there was no profit, their partnership is invalid. Is Peter
correct?

Solve:
Issue: The main issue is whether Peter is correct in arguing that the partnership is invalid due to
the lack of profit, and whether he is entitled to a refund of his $10,000 contribution.

Rule: The relevant legal principles involve the formation of a partnership, the sharing of profits
and losses, and the liability of partners for debts and liabilities of the partnership.

Application:

Formation of a Partnership: A partnership is generally formed when two or more individuals

agree to carry on a business together with a view to making a profit. In this case, Peter and Fred
agreed to contribute funds to form a partnership for a business venture.

Sharing of Profits and Losses: Partnerships often involve the sharing of both profits and losses.
While the written partnership agreement stipulated that profits would be shared equally, it is
important to consider whether there was any provision for the allocation of losses. The absence
of profit alone does not necessarily invalidate a partnership.
Liability for Debts and Liabilities: Partners in a partnership are generally jointly and severally
liable for the debts and liabilities of the partnership. This means that each partner can be held
responsible for the partnership's obligations, regardless of profit or loss.

Conclusion:

Based on the information provided, Peter's argument that the partnership is invalid due to the
lack of profit is likely incorrect. A partnership can exist even if no profit has been made, as long
as the partners agreed to carry on a business venture together with the intention of making a
profit. The fact that there has been no profit does not necessarily invalidate the partnership.

Regarding Peter's request for a refund of his $10,000 contribution, the situation is more
complex. Partnerships often involve shared financial contributions, and partners generally
cannot demand a refund of their contributions simply due to the absence of profit. Additionally,
Fred's investment of an additional $5,000 for office premises and furniture could also impact the
overall financial arrangement between the partners.

If Fred has incurred debts and liabilities on behalf of the partnership, his refusal to refund Peter's
contribution might be related to the partnership's financial obligations. Partners are typically
liable for the debts and liabilities of the partnership, even if no profit has been generated.

In conclusion, Peter's argument that the lack of profit invalidates the partnership is not likely to
be correct. Partnerships can exist even without immediate profits. As for the refund of Peter's
contribution, the specific circumstances, terms of the partnership agreement, and financial
obligations of the partnership would need to be carefully considered.

Case question:
Celine agreed with Dylan to sell a DVD of a famous singer in return for 12 rings from ring pull
cans of Pepsi. However later, she refused to give Dylan the DVD. She argued that the
agreement between them was unenforceable as the rings from the Pepsi cans would be treated
as having no value because they would be simply thrown away by the seller. Is their agreement
enforceable and why?

Solve:
Issue: The main issue is whether the agreement between Celine and Dylan, where Celine
agrees to sell a DVD of a famous singer in exchange for 12 rings from ring pull cans of Pepsi, is
enforceable.

Rule: The relevant legal principles include the concepts of consideration, adequacy of
consideration, and whether an agreement lacks the essential elements of a valid contract.

Application:
Consideration: For a contract to be valid, there must be consideration exchanged between the
parties. Consideration refers to something of value that is given or promised in exchange for
something else. Both parties must give something of value or make a promise to each other. In
this case, Celine is agreeing to sell a DVD, and Dylan is offering 12 rings from ring pull cans of
Pepsi.

Adequacy of Consideration: While consideration is required for a valid contract, the law
generally does not concern itself with the adequacy of consideration. In other words, the court
does not typically evaluate whether the value of what is being exchanged is equal. The
consideration need not be of equal value; it just needs to be something of legal value.

Lack of Value Argument: Celine argues that the rings from the Pepsi cans would be treated as
having no value since they would be thrown away. However, the legal concept of consideration
is not concerned with whether the consideration is valuable in the eyes of a third party or
whether it has long-term value. As long as both parties agreed to the exchange, it generally
satisfies the consideration requirement.

Conclusion:

Based on the information provided, the agreement between Celine and Dylan is likely
enforceable. Both parties have offered consideration: Celine is offering a DVD, and Dylan is
offering 12 rings from ring pull cans of Pepsi. The fact that the rings might have no value to a
third party or might be thrown away does not necessarily invalidate the consideration.
Legal issues: Whether Pepsi rings are consideration