Brenda Is a Purchasing Agent for Commodities Exchange Corporation

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Examlex · Accepted Answer

The Answer is Commodities is liable to E-Products.Brenda is not liable to E-Products.A principal is liable for the contracts of its agents entered into with actual or apparent authority.Actual authority may be express or implied.Apparent authority arises from what the principal causes a third party reasonably to believe regarding the agent's authority to act,even if the agent does not have actual authority to act.If the third party changes its position in reliance on the principal's representations,the principal is estopped from denying that the agent had authority.In this problem,Brenda had the actual authority to order fifty notebook computers and apparent authority to order the rest of the equipment,according to the written authorization that Dennis gave to Brenda and Brenda showed to E-Products.E-Products's contract rights are not limited by the limits placed on that authority by Dennis's call to Brenda.Brenda is not liable to E-Products because she acted with apparent authority.Brenda is liable to Commodities,however,for exceeding her authority.

Brenda Is a Purchasing Agent for Commodities Exchange Corporation

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