13. Tim Shine owns five furniture stores in Indiana, which he runs as a sole pro

Question

13. Tim Shine owns five furniture stores in Indiana, which he runs as a sole proprietorship under the name of HIGH LOW FURNITURE, "high in quality, low in price." Tim hired Brian Burke as the manager of his West Lafayette store on June 1, 2017. Tim told Brian, "You have full authority to run the store and if you do a good job, I will stay out of your way as much as possible." Tim also told Brian, "You can hire employees, but only subject to my approval. I don't want any salespersons on the floor of any of my stores unless I have personally approved their employment." On June 5, 2017, Brian hired Katherine Regester as a salesperson and told her to report for work the following day. Katherine had just graduated from college. Although she didn't have any sales experience, she was eager to learn and just a little bit apprehensive about her first, fulltime job. Brian told her, "Don't worry. You will probably make a few mistakes at the beginning, but we'll back you up. You'll get the hang of the job in a couple of weeks." Tim traveled around to each of his five stores. During June he was in and out of the West Lafayette store a number of different times. Katherine knew who Tim was and what he looked like from his frequent TV commercials. Katherine also knew that Tim owned HIGH LOW FURNITURE. Tim spoke to Katherine each time he came into the store. On one occasion he watched her sell a dining room set from a distance. After the sale was successfully concluded, Tim came up to her and said, "Young lady that was a very good sales effort." Tim also reviewed all the sales invoices from the West Lafayette store, including those signed by Katherine as a "salesperson". On June 27, Brian and Tim had an intense disagreement over the advertising budget. Brian quit and walked out of the store not to be seen again. On June 30, Katherine looked for her first paycheck. There was none. She continued to work in the store until July 3rd, when she saw Tim come into the store. She asked Tim when she would get paid. Tim told her that he was unaware that she was an employee. He also told her that "it is a common practice in the furniture business for family, friends, and relatives of salespeople to assist them irn making sales. Tim told her that he had never approved hiring her and that she simply wasn't an employee. He said that he would hire her as a salesperson effective July 3, but that she would have to get her pay for June from Brian. You must make your decision on the basis of general agency principles. a. Brian was an agent b. Katherine was an agent c. This case involves apparent authority d. This case involves ratification under agency law e. All of the above

Explanation / Answer

E. Allof these are correct

A. and B, both were hired by their bosses and so acted as an agent to perform the duty for their bosses.

C. As the authority were restricted, some of it required approval which were not taken and so apparent authority is involved. (As Brian assumed a lot more)

D.As per agency law, the one who hired the other as agent needs to fulfill his or her promise. The one not involved directly is immune.

Hence All of the above.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.