Explain claimed circumstances, Business Law and Ethics

Question 1 -

Hatfield owned a large farm on which he grew grain. His combine was inadequate in relation to the acreage of grain that he harvested annually. As a result, on several occasions his crops had been adversely affected by rain and poor weather conditions. He reasoned that a larger machine could reduce the time spent harvesting by as much as two-thirds and, thereby, reduce the chances of bad weather affecting his harvest.

At an agricultural exhibition, he examined a new self-propelled combine that was advertised as capable of harvesting grain at three times the speed of his old equipment. The machine was much larger and more powerful than his old combine and appeared to be of the correct size for his farm.

On his return home, he contacted the local dealer for the combine. After explaining his needs, he was assured by the dealer that the size he was considering would be capable of harvesting his crop in one-third of the time taken by his older model. He placed an order for the combine, with delivery to be made in early July, well before he would require the equipment.

The machine did not arrive until the beginning of the harvest, and Hatfield immediately put the machine into service. Unfortunately, the machine was out of adjustment, and Hatfield was obliged to call the dealer to put it in order. The equipment continued to break down each time Hatfield operated it at the recommended speed. In spite of numerous attempts by the dealer to correct the problem, the equipment could not be operated at anything more than a very slow speed without a breakdown. Hatfield found that despite the large size of the equipment, his harvest time was no faster. When the harvest was completed, he returned the machine and demanded his money back.

The equipment dealer refused to return his money. He pointed to a clause in the purchase agreement that Hatfield had signed, which read: "No warranty or condition, express or implied, shall apply to this agreement with respect of fitness for the use intended or as to performance, except those specifically stated herein."

The only reference in the agreement to the equipment stated that it was to be a "new model XVX self-propelled combine."

Advise Hatfield of his rights (if any).

Question 2 - 

Sayeeda operated a small food stand at an open-air market where farmers in close proximity to one another had set up makeshift stalls or tables to display their produce. To protect themselves from the hot sun, most had erected canvas or cloth canopies over their tables. The stand operated by Sayeeda was located in the midst of the covered stalls.

For the purpose of cooking a particular delicacy that she sold, Sayeeda had placed a tiny propane-fuelled stove on her tabletop and used it to boil a pot of oil. While she was serving a customer, a youth about 16 years old turned up the flame on the burner, and the oil immediately caught fire. In a frantic attempt to put out the fire, Sayeeda seized the flaming pot and flung it from her food stand. The youth was splashed with flaming oil and was seriously burned when his clothes caught fire.

The pot of burning oil landed in a nearby farmer's stall and set fire to the canopy that he had placed over it. The farmer kicked the flaming pot out of his stall and into a neighbouring stall, where it set fire to a quantity of paper that was used for food packaging.

Before the fire was finally extinguished, three stalls had been destroyed, and both the youth and Sayeeda hospitalized with serious burns.

Discuss the rights and liabilities of the parties involved in this incident.

Question 3 - 

Lukas owned a small factory of long-standing reputation, and bid successfully on a contract from Atlas Aircraft. The aerospace manufacturer's contract was for Lukas to supply custom-made hydraulic cylinders for landing-gear assemblies. To execute the job, Lukas required a heavy metal milling machine capable of handling large pieces with high degrees of precision. He had heard of the impressive capability of the Stormsen 1500 mill and placed an order for one, which in time was delivered and installed. Over a period of months, Lukas found the machine was constantly working out of adjustment, causing much of its output to fail quality control. Six times, Lukas caught as many as 2 faults in a job lot of 20 cylinders, and on one early occasion Atlas Aircraft returned a cylinder as substandard. After consulting all the Stormsen manuals, looking for an adjustment solution, Lukas called in the area distributor for consultation. No long term solution to the wandering adjustment seemed apparent, and Lukas began placing calls to the Stormsen Company itself. In the meantime more cylinders had been rejected by Atlas, whose chief engineer (a personal friend of Lukas) wrote Lukas a letter wondering why "suddenly [it] was receiving crap." Lukas' calls to Stormsen were fielded by an engineer/manager, Lewis Cranston, but Lukas remained far from satisfied. Within another month, Lukas visited a tradeshow where Stormsen machines were displayed, and in the display area was Cranston. The two, meeting for the first time, exchanged words before the shouting began. In the end, they had drawn quite a crowd of factory owners and two writers from a trade journal. The exchange ended with Lukas brandishing the Atlas letter before the onlookers, shouting "The 1500 produces crap, Atlas calls the 1500 crap, and I call the 1500 crap!

Discuss the tort issues that may arise from this situation.

Question 4 - 

Corgi was the breeder of prize-winning pedigree dogs that often sold for very high prices. Reynolds, a wealthy businessman who had recently retired, decided to purchase one of these dogs. His intention was to enter the animal in the various dog shows that were held from time to time across the country.

Reynolds knew very little about dogs. He explained to Corgi that he wished to purchase a young dog that was already a prize-winning specimen of the breed. Corgi took Reynolds to a fenced run where several young dogs were caged. He pointed to one dog that he said, in his opinion, had the greatest potential, and that it had already won a prize at a local dog show. Corgi pointed to a red ribbon pinned to the opposite wall of the kennel building and explained that it was a first-prize ribbon that the dog had won. Reynolds did not bother to examine the ribbon.

Reynolds purchased the dog for $1,000 and took it home. His neighbour later saw the dog in Reynolds' backyard. He instantly recognized it as the dog that had recently won the first-prize ribbon in the children's pet show at the neighbourhood park. When he told Reynolds where he had last seen the dog, Reynolds telephoned Corgi immediately and demanded his money back.

Corgi refused to return Reynolds' money or take back the dog, and Reynolds threatened to take legal proceedings against him. Reynolds was unable to do so immediately, however, as he was called out of town on a family matter the next day. He was obliged to leave the dog with his neighbour during his absence. Reynolds advised the neighbour to take care of the animal as if it were his own.

Reynolds was out of town for several weeks. During that time, his neighbour entered the dog in a dog show sponsored by a kennel club. The dog won first prize in its class for its breed. On Reynolds' return, the neighbour advised him of his success. The two men decided to enter the dog in another dog show that was scheduled to be held in a nearby city.

At this second show, the dog placed only third in its class, and Reynolds was disappointed. He returned home and immediately took legal action against Corgi.

Discuss the basis of Reynolds' claim and the defences (if any) of Corgi. Render, with reasons, a decision.

Extra Questions need to be answer:

1. An engineer designed an outdoor elevated patio that was expected to accommodate conference meetings of up to 100 persons. The engineer considered the load bearing structure on the basis of the weight of 200 persons as a safety factor. When the structure was completed, the owner decided to use the patio for a rock concert, and sold 400 tickets. In actual fact over 400 patrons attended, and packed the patio for a ‘standing room only' concert. The enthusiastic crowd at one point began jumping to the music, and the additional load pressure caused the structure to collapse, injuring many of the patrons

How would liability be determined in this case?

2. Define qualified and absolute privilege, and explain the circumstances where each might be claimed.

Posted Date: 2/26/2013 6:20:59 AM | Location : United States

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