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Liability and Agency Law

1. A number of football fans from LA purchased a tour package through Shifty Travel Agency (Shifty). The package included transportation, lodging, and tickets to the Super Bowl at New Orleans. Shifty acted as a broker for Honest Tours (Honest), and the fans contracted with Honest for the package. However, when they got to New Orleans there were no tickets. When they returned to LA, they sued Shifty for breach of contract.

Is Shifty liable according to Agency Law principles? Why or why not.

2. Frank, John and Mike formed a partnership to operate a flower shop. One of Frank's jobs is to make deliveries using the partnership truck. In one such delivery, Frank negligently ran a stop sign, striking a car driven by Peggy, causing damage to the car and injury to Peggy.

Discuss the personal and partner liability of Frank, John and Mike, and the liability of the partnership.

Solution Preview

1) Is Shifty liable according to Agency Law principles? Why or why not.

The answer is yes. The application of agency law involves the interaction among three parties. Although individuals usually are these parties, agency relationship can involve business organizations.

First, a principal interacts with someone (or some organization) for the purpose of obtaining that second party's assistance. This second party is the agent. Second, the agent (on behalf of the principal) interacts with a third ...

Solution Summary

The concepts of Agency Law and personal and partner liability are discussed.

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