Business Law Written Assignment 5

Written Assignment 5

James Rice

LAW-201

Thomas Edison State College

Case Study 1

Aker has been Potter’s sales agent for twenty years and has dealt with about 200 customers during that time. In 2008 Potter fires Aker, terminating the agency. None of the 200 customers have heard about the termination. What steps must Potter take to protect himself from potential liability from customers and Aker?

If Potter has terminated the agency he does not have to worry about Aker stealing clients from him unless he starts a new agency in the same field. However, if Potter has Aker sign a non-disclosure / non-compete agreement as part of his employment he will be protected against Aker stealing clients and divulging important information that could be damaging to Potter. Potter may also want to consider declaring bankruptcy in order to protect his personal assets against any money that is owed to Aker or his clients.

Typically, the principal is obligated to notify all of the agencies clients that the agencies relationship with Aker has been terminated. The principle would also be responsible for informing the clients that the agency is no longer in business. This should be done in writing. They should send each customer a written notice via certified mail that the principal / agency relationship has been terminated. Failure to provide such notice will leave the Potter liable for unauthorized acts of the agent (Aker) even though he has been terminated.

Case Study 2

Pete Principal instructs Al Agent, his employee, to repossess some property owned by Ted Turner. Al knows that the repossession is illegal but performs it anyway. Please prepare a written discussion on all aspects of the potential liability in this case. Consider in your answer Agency Law and the right of third parties. Also demonstrate your understanding of the relationship between the principal and the agent and the authority conferred upon the agent by the principal.

Pete Principal is without...