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WK_2_DQ2 - case(Cheeseman 2010 p 331 The Agency portion of...

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WK 2, DQ 2 Paulette is the owner of the Rock On Mobile Home Park. For several years, Albert regularly collected rent for Paulette from the tenants of the mobile home park. Recently, Paulette learned that Albert pocketed some rent he collected, so Paulette fired Albert, and revoked his authority to collect rent payments from tenants. However, neither Paulette nor Albert told any tenants of Albert's termination. Yesterday, Albert went around to Theresa’s mobile home and asked for the rent. Theresa paid Albert the money owed to Paulette. Albert never gave this money to Paulette. Is Theresa liable to pay Paulette? Why or why not? What legal principle did you apply? Discuss an agent’s obligations toward his principal. Theresa is not liable to pay Paulette, as long as she has a receipt or cancelled check, which proves that she paid the rent to Albert. Paulette’s mistake was not notifying her tenants that Albert is no longer authorized to accept rent payments for her. The Agency law applies on this
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Unformatted text preview: case (Cheeseman, 2010, p. 331). The Agency portion of commercial law states that an agent (Albert) can act on behalf of the principal (Paulette), when there is a contractual obligation between principal and agent (Paulette hired Albert and was allowed to collect rent payments). Any agent, acting on behalf of a principal, owes a fiduciary duty to be loyal to the principal. An agent cannot usurp an opportunity from the principal, as in the case of Albert. Paulette definitely has the upper hand, if she wishes to sue Albert. An employee is an agent of the organization for which he or she is employed at and can be terminated if the employees actions violate the organizations code of ethics or is found to act fraudulently. Reference: Cheeseman, H. (2010). The Legal Environment of Business and Online Commerce: Business Ethics, E-Commerce, Regulatory and International Issues . Retrieved from www.ecampus.phoenix.edu on January 21, 2010...
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