Agency Law -Question & Analysis Explaination Law Case Study (Case Study Sample)
Suppose that a business, Widgets, Inc., has operations only in Tennessee. Widget's sells no products outside that state and has no other operations anywhere else. Chuck, a former sales representative for Widgets, Inc. lives in Virginia. Chuck realizes that there are no Widgets, Inc. brand widgets offered for sale in Virginia. He decides that despite the retail price, he can still make a profit by selling Widgets, Inc. widgets in Virginia. After all, Chuck already owns a retail business himself and can easily incorporate the product line into his storefront.
For six months, every week, Chuck rents a RYDER truck and journeys to Tennessee where he purchases a truckload of widgets from Widgets, Inc.
RYDER is fully aware of the nature of the transported items and initially pays particular attention to Chuck's attire each time he appears to rent the truck. Chuck wears customized attire from his former employment with Widgets, Inc. His shirt and shorts bear the name Widgets Inc. and the logo is quite noticeable.
Chuck wears this custom attire when driving to Tennessee and visits his former colleagues when at the company. He thinks it is funny to wear the old uniform when visiting the company. He visits and talks to his friends and colleagues, has lunch every time and leaves with his purchase.
Chuck experiences monetary issues in his personal life. He rents the RYDER truck but fails to pay RYDER truck for several rental periods.
RYDER then submits an invoice to Widgets, Inc. for payment.
QUESTION: Should Widget's pay the invoice, why or why not? This question requires an Agency Law Analysis in your answer and application in your answer.
Define, explain and identify the law and then answer the questions.
Solving Chuck’s Issue Using Agency Law Analysis
Solving Chuck’s issue using Agency Law Analysis
Agency law deals with relationships that involve agents who are authorized to act on behalf of the principal to create legal relations with a third party. Under this law, the principal permits the agent to express actual or apparent authority by acting on his behalf. However, the agent is still under the control of the principal. Focusing on evident influence, it occurs when the principal’s behavior or words make the third party to believe that a particular agent is indeed acting on behalf of the principal (Cornell Law School, n.d). The third-party might be driven to think that the supposed agent is operating on behalf of the principal even when that kind of business relationship does not exist.
Admittedly, this is what happens in the scenario that involves Chuck, Widget Inc., and Ryder Truck. Widg
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