Business Law

Answer the following six Questions based upon the materials covered throughout the semester.  You must identify the appropriate laws, rules and/or definitions that are applicable to each case scenario and specifically apply the laws, rules and/or definitions in explaining your answers and decisions in each case.
Answers are to be submitted using MS Word (or another word processor) and should be no less than 200 words for each question.  Do not repeat the Questions as part of your answers.
Once written, upload the document as a file attachment (filename: LastNameFirstName_ExtraCredit) to this assignment and submit.  Note: If you use Apple Pages, please save the document as a pdf and upload that file.

QUESTION NO. 1:  Acme Clock Company is in the business of selling and repairing clocks.  Francis purchased a grandfather clock from them.  Lisa had left the clock at Acme’s for a cleaning and calibration. When Lisa found out the clock had been sold, she contacted Francis and demanded he return it.  Must Francis comply with Lisa’s demand?  What other options does she have?

QUESTION NO. 2:  Amy obtained telescopes from the Vision Optics Company at dealer prices on the pretense of being a dealer in optical equipment. Vision later determined that Amy was not, had never been, and did not plan to be a dealer in optics. By the time these facts emerged, Amy had succeeded in selling the telescopes to several individuals located throughout the country. These buyers had responded to advertisements placed by Amy, who again had represented herself as a dealer in optical equipment. The buyers had purchased the telescopes in good faith at prices consistent with comparable equipment. Vision located these buyers and demanded that the telescopes be returned as property obtained through fraud. Do the buyers of these telescopes have to return their purchases?

QUESTION NO. 3:  Sue was seriously ill and feared that she might lapse into a coma or somehow become unable to speak or act for herself in her medical emergency. She is aware that agents ordinarily lose their authority to act for principals who become mentally disabled. She nevertheless desires to have her husband Frank make medical decisions and speak on her behalf. She is particularly concerned about existing on life support in a persistent and incurable vegetative state. Is there any action that she might take to enable Frank to act for her?

QUESTION NO. 4:  Hannah, Amanda, and Cathy are interested in forming a business. Hannah is quite wealthy and is ready to contribute money to the venture. Amanda has a degree in business from an excellent university, worked for five years as a manager in a major corporation, and currently is a leadership/management consultant. Cathy is a scientist who has developed a process that will, according to her, “revolutionize cancer treatment throughout the world.” Hannah, Amanda, and Cathy believe it is in their best interest to form a general partnership. Do you agree? Is there a more appropriate form of business you might recommend?

QUESTION NO. 5:  You are asked to provide two friends who are in business together with advice regarding what they need to do to legally in order to form a limited liability company. Although your friends like the general notion of limited liability in the operation of their business, they are totally unfamiliar with the legal processes for forming a LLC, so you need to provide them with the basic requirements for LLC creation. What specific advice would you give them?

QUESTION NO. 6:  Joseph bought land and a house from Jerry but never recorded the deed. Jerry stayed on the property as a tenant for three years. Near the end of the three years, Jerry learned that Joseph had never recorded the deed. Jerry advertised the land and house for sale and Chrissy negotiated with Jerry thinking that Jerry was the owner. Finally, Chrissy checked the records at the recording office and, finding no reason to question Jerry’s ownership of the property, purchased the land and house from Jerry. Chrissy recorded the deed and Jerry fled with the purchase money. Meanwhile, Joseph had failed to pay the real estate taxes on the land house for the three years in question thinking it was the responsibility of Jerry, the tenant. Ultimately, Chrissy and Joseph disputed over the ownership of the property. Decide the case between Chrissy and Joseph. Also decide whether Joseph is responsible for the three years of real estate taxes assessed while Jerry occupied the property as a tenant.

Traditionally laws are applied based on the context and subject in question. This paper analyzes some of the non-linear ways laws are interpreted in the contemporary business environment

Question 1

According to the United States Constitution regarding the sale of goods, Francis should not return the clock. When Lisa left the clock at Acme, Lisa initiated a bailment process. On the other hand, Acme is in the franchising business; therefore, he sold the clock to Francis in good faith.  As a result, Lisa has a good cause of action against Acme for selling her clock without permission. If Acme sold the clock knowing it belonged to Lisa, some states could rule the sale as a crime, such as a larceny. Acme, Francis, and Lisa must attend all legal proceedings. However, Francis has the upper hand in winning the case as the law positions him as the rightful owner of the clock.

Question 2

The buyers do not have to return the telescopes to the Vision Optics Company. This is mainly because they honored the end of the deal and purchased the items in good faith. Even though the telescopes were the subject of fraudulent action by Amy, the purchasers had rightfully given value for the merchandise. If Vision Optics had uncovered the fraud activities before Amy’s sales, there would have been a valid cause of action to demand the retrieval of goods from her custody. Unfortunately, at this point, Vision Optics must bar itself from seeking action against Amy for fraud.

Question 3

Any contract between a principal and an authority is a legally binding agreement with stipulated restrictions. In this case, the agent is prohibited from making decisions on behalf of the principal as he/she may be psychologically affected by his/her partner’s illness. Given the close relations with the principal, the agent can manipulate the medical decision to fulfill his/her selfish interests; in such a scenario, the law considers that an agent is liable for a breach of warranty.

Question 4

The company act states that Limited partnerships, General partnerships, Limited liability partnerships, Sole proprietorship, Limited liability companies, and Corporations as the major types of partnerships. In this scenario, this partnership falls under the general partnership category. Unfortunately, this is not the most appropriate form of business for Hannah, Amanda, and Cathy as all of them have different interests and expertise. Furthermore, all the parties have different capabilities and potential to fuel the growth of the partnerships. As a result, it is not advisable to share legal liabilities, dividends, profits, and financial liabilities. General partnerships accrue massive liabilities that inhibit the business’s growth and development, such as auctioning each partner’s assets. In my opinion, the most appropriate form of ownership is a Limited liability partnership. This form of cooperation allows individuals to be liable to liabilities limited to the assets or capital injected into the business. In this kind of structure, each partner is not responsible for the misconduct or negligence of another partner.

Question 5

Initially, the party members should choose an appropriate LLC name and ensure there is no existing Limited Liability Company with a similar term in the State’s office. Next, you need to select a registered agent to oversee the legal matters of the LLC. At this stage, the agent receives incoming legal documents on behalf of the LLC. The law stipulates that all agents must be above 18 years and have a valid enterprise that caters to all registration processes (Jane, 2020). Furthermore, the agent must have a valid address registered within the jurisdiction. The parties involved must also draft an LLC operating agreement that describes the running and operation of the LLC. This document contains information on how the business will be run and operated regarding the LLC member’s contribution and the successive division of dividends. It is also mandatory for the party members to compile together which acts legally binding document between the State and the LLC party members. After this, the agent will submit the articles to agencies for any interested parties to review. At this point, the party members should pay a facilitation fee to the State’s agency. The final step in forming an LLC is to file the Articles of Organization by submitting the articles and filing fees to your agency. At this point, the LLC members can publish the form in the Newspaper for intent to form an LLC. From this point, the LLC office will reach out to you to verify if you’re proposed LLC name is available and valid.

Question 6

The case between Chrissy and Joseph is controversial as they are the third party and do not have access to the original documents documenting the transfer of ownership. However, Joseph is liable for a fine due to the delay in facilitating the transition process and pay up the real estate taxes. In a court of law, Joseph will lose the land as he has no legal document showcasing that he is the owner of the land and house.

Reference List

Jane, H., 2020. How to Form an LLC.



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