Issues Related to Business Law - Essay Example

Final Paper Case Study This case presents several contract, laws, and agency issues among others. This paper describes and analyses issues related to business law that arises from this case. One of the issues that arise from this case is defamation, which is seen between the case of Chetum v. Knarlesn is defamation. Knarles wants to cancel the agreement that Chetum made with Knarles’ son Barkley in his absence. He does this by telling Chetum that he will send him a check to cater for what he paid the maintenance company, and he will not even ask for payment for the job already done. However, Chetum disagrees with this decision and sue him for breach of contract. To prove defamation under the rule of law, it requires a false statement concerning plaintiff, or of fact causing damages and published to a third party. Regarding public issue or person, defamation the plaintiff must attest that the statement is false, as well as that defendant acted with malice or knew of its truth. Analyzing the statements made by Knarles shows that they were just mere opinion as opposed to facts. Thus, there is no defamation in this case. However, one may argue that Knarles’ statement was defamatory because he lacks proof of the truth to base his comments. Hence, even though it is a matter of public concern and fair comment, he acts recklessly by disregarding the truth. In this case, Knarles is liable for defamation. Similarly, the issue of defamation also comes up between the case of Chetum v. Stucko. Still referring to the rule of law, one must prove that the statements made are facts, and causes damages published to the third party. Stucko’s statements are based on facts, but assuming that they are made with reckless disregard of the truth, then Stucko is in this case liable for defamation. Nevertheless, truth is the absolute and greatest defense to defamation; thus, if thus, if the statements Stucko made are true then he is exempted from defamation liability. Several issues and matters of contract arise between Chetum v. Facilies Company FC. First, there is professional negligence, in which the common law defines professional law as an instance where an individual with agency obligation breaches the duty he has to a principal (Deakin and Markesinis 24). In addition, the breach of duty must cause real or proximate injury to the principal. The plumber has a professional duty to his client even if he has an expired license. Analyzing the situation, the plumber into an agency agreement and assumed the obligation of repairing the boiler for Chetum. Thus, the plumber violates his duty of fiduciary when he fails to either fix the boiler, or replace it so that it does not release carbon monoxide, or withdraw from the agreement by refusing to complete the contract. In addition, the plumber also violates his agency duties by failing to act in loyalty in the best and highest financial interests of his principal. As a result, the plumber is liable for professional negligence. Similarly, FC is liable for professional negligence to Chetum because Plumber acted as an employee of the company when he entered into an agreement with Chetum. Between Chetum and Facilities Company, there is a breach of contract. Under the rule of law, a breach of contract occurs when one party violates the promise of agreement materially causing damage to another party. Nevertheless, the contract between Chetum and FC is voidable, and thus, FC is not liable for breach of express contract to Chetum. However, with regard to implied agency agreement, FC is liable to Chetum. This brings in the issue of contract formation, which under the rule of law requires acceptance, an offer, and consideration. The offer part of an agreement contains intent, definite terms, which must be communicated to the offeree. Acceptance constitutes assenting to the offer terms and conditions, and finally, consideration involves a legal detriment and benefit provided in the offer (Deakin and Markesinis 25). The formation of contract also applies to the agreement between Barkley and Chetum. For instance, Barkely demonstrated an existing contractual intent by signing and sending a written contract to Chetum. In addition, this contract contained certain and definite terms, as well as conditions of promised services. On the other side, Chetum also signed the contract, and with that, he demonstrated an unequivocal acceptance. In addition, he fulfilled the consideration condition by returning check for the first month. Therefore, the exercise represents a typical contract formation; thus, there was a contract between Chetum and Barkely. The issue of battery arises between the residents of the building and the owner Chetum. According to the common law, battery passes for intentional offensive or harmfully touching of another individual without privilege or consent. With regard to this definition of battery, Chetum engages in intentional harm that touches all the residents living in his building when he tells the plumber to fix the boiler while knowing that the company has recalled it and it is defective (Gerven 78). Thus, in this case Chetum has a liability for battery. Similarly, Chetum breaches the convenient of quiet enjoyment of the residents by failing to act to ensure or secure the enjoyment of residents in his building. Under the lease of agreement for quiet enjoyment, the residents have the right to enjoy their tenancy. As a result, Chetum breaches the contract or covenant by failing to replace the boiler despite knowing it is defective. The final issue that arises between the residents and Chetum is the breach of implied covenant of good faith. This ensues when one party in the contract prevents the other part from attaining the benefits of the contractual bargain. This brings in the concept of tort, which is a civil wrong that causes another individual to suffer harm or loss leading to a legal liability. Chetum commits civil wrong when he fails to provide an adequate, proper and safe heating system for the residents, and instead, he opts to repair the defective and dangerous boiler. This inhibits the residents from enjoying the benefits of the lease leading to breach of covenant of good faith. A resident v. Housewarm presents a case where Housewarm has a responsibility to ensure the safety of their equipment, and ensure that they protect the residents from harm. The issue that arises between the residents and Housewarm is the strict product liability. Under the law, Strict Product Liability results when the defective design of the product injures the plaintiff. In addition, it also results when there is warning or manufacturer, in which used in a reasonable foreseeable manner (Mayer et al. 45). Analysis of the situation reveals that the boiler releases carbon monoxide, and thus, it is extremely dangerous to the residents. Carbon monoxide is a dangerous gas because it can result in death of a person if the individual is within an enclosed space such as an apartment. Hence, Housewarm ought to have sent its own personnel or plumber to repair the boiler. This is because there lacks anything else that could alleviate the intrinsic danger associated with the boiler affixed to a residential home or real property. Thus, Housewarm is liable for injuries of the residents proximate to the boiler because of defect in warning, design, or manufacture. Housewarm bears the responsibility to ensure safety of the residents leaving in the building and calling back the product is not enough to ensure safety of the residents. Looking at the contract made between Barkley on behalf of the company and Chetum, Barkley was only 17 years old, and thus, he had no mandate or power to make and sign a contract on behalf of the company. The common law states that a minor may void or disarm a contract that had been made during the minority with exemptions of clothing, shelter, food, shelter, and healthcare (Gerven 449). Barkley because of his age cannot make a contract on behalf of his company since this is not a ‘necessary’ product intended for Barkley. This means that Barkley or his father can void the contract he made with Chetum under the defense of incapacitation. Though the facts of the case do not express as to whether Barkley disarmed the contract, or his intent to do so, if Barkley decides to follow his father’s decision to make an agreement with Chetum void, he is under his rights to do so. This implies that the agreement between Chetum and Barkley is unenforceable, and Barkley can easily break it without attracting any legal liability. There is actual agency contract between the Plumber and Chetum in which the person that acts as the go between is Barkley. Actual agency contract under the common law is a contract implied in a case where both the parties’ conduct show that there is an intent to be bound to a contract, which enables one party to act on the behalf of the other party. When Plumber gets to the site to fix a broken boiler belong to a residence that Chetum owns, he notices that the company has actually recalled the boiler, and even so, fixing it will only cause more problems such as release of carbon monoxide. Therefore, the Plumber calls Barkley and gives him information whom in turn relays the information to the boiler regarding the problems with the boiler. Chetum through Barkley then instructs the Plumber to go ahead and fix the boiler, at least to serve the residents during the winter period. Therefore, there is an actual agency agreement between the plumber and Chetum, in which the Plumber has an obligation to resolve the boiler problem by using his best efforts. In this case, an actual agency contract is present between Chetum and Barkley, and any of them who violate it faces legal liability. Finally yet importantly, another business law issue derived from thus case is the issue of respondent superior. Respondent superior is where the company or its management is held responsible for the actions of their employees. In this case, FC is responsible for the Plumber’s actions since he is an employee of the company. This concept inhibits employers from profiting from illegal acts performed by their employees, but avoiding legal repercussions. In this case, the rule stands true if the illegal activities that the employee engages in are beneficial to the company that he/she works for, as opposed for his/her personal benefit (Gerven 450). An employee acts as an agent of the employer, thus, any activity that he undertakes for the benefit of the company, the company too bears responsibility for this activity. Back to the case, analysis reveals that the principal-agent relationship exists between the Plumber and FC. Consequently, the company is responsible for any injury or harm caused by the employee, which means that FC is responsible for the Plumber’s actions. The common rule states that an employer is liable for omissions and acts of an employee, as long as these are done within the employment scope. FC is responsible for the omissions and acts involving the Plumber’s decision actions are he enters into an agreement with Chetum. In addition, Chetum and FC are contractually bound with regard to the issue of the boiler repair despite that fact that the expressly written contract is invalid in this case. Contracts make up a complicated part of the legal component because of their nature of vulnerability and conflicts. The formation of a contract involves three concepts that must be met in order to be considered a valid contract, and these are acceptance, intent, and consideration. These components of a contract are essential in understanding and interpreting the legal issues arising from contracts. For instance, in this case, Barkley enters into a contract with Chetum, which his father disputes on discovery. Because of this Chetum decides to sue for breach of contract. The case presents several issues such as defamation, professional negligence, and breach of contract, battery, incapacitation, respondent superior, and actual agency contract among others. These issues have provisions under the common law, and if any of the parties violates the rules then they become liable for breach of contract under various circumstances. Works Cited Deakin, Johnston and Markesinis. Markesinis & Deakin's Tort Law. Oxford: Oxford University Press, 2008. Print. Gerven, W. van. Cases, Materials and Text on National, Supranational and International Tort Law. Oxford: Hart Publishing, 2001.Print. Mayer, Don, et al. Advanced Business Law and the Legal Environment. New York, 2012. Print. Read More