Jonathan Is a Used Car Enthusiast

question 13

Multiple Choice

Jonathan is a used car enthusiast.He enters into an agency agreement with Andrea.She owns a used car lot.The agency agreement limits Jonathan's authority to purchase used vehicles for under $25,000 and to ship them by flat bed trailer to Andrea's lot.When passing through Toronto one Saturday morning,Jonathan stops at the auto auction and sees a 1985 Jaguar that he wanted to bid on for Andrea.He was successful and purchased the vehicle for $24,000.However,he had no flat bed trailer and as such decided to drive the vehicle to Andrea's lot in London.He immediately arranged for automobile insurance on her behalf but without her authority.Near Kitchener he was involved in an automobile accident which resulted in the jaguar being a total write-off.No one was injured.He contacted Andrea and informed her of the situation.She immediately contacted the insurance company to ratify the insurance contract.In these circumstances

• A)Given that there was no personal injury,the insurance contract can be ratified.
• B)So long as the initial call made by agent was prior to the accident,the insurance contract can be ratified.
• C)Because Jonathan had the apparent authority to enter into the insurance contract,it is binding on Andrea.
• D)Andrea was unable to ratify the contract because at the time she attempted to do so the accident had already occurred.