INTERNATIONAL TRAINING COLLEGE - LINGUA

Towards Educational Excellence

NCHE Reg. No: R0014
NQA Accreditation No: 000095

DEPARTMENT OF BUSINESS AND MANAGEMENT

MARKING KEY: ASSIGNMENT 2

Lecturer: MR W. MUSHONGA Due Date: 7 MAY 2020

QUALIFICATION : Diploma in Accounting & Finance (NQF Level 5)

:Bachelor’s Degree in Business Administration (NQF Level 7)

MODULE : Commercial Law (NQF 5)

ASSIGNMENT : 2

TOTAL MARKS: 30 marks

QUESTION ONE

Goagoses has been retained by Hamutenya Manufacturing Company as an agent to transport

its merchandise to remote areas of the country. The commodities to be transferred included
tomatoes (perishables). On his way to deliver, the vehicle without his fault developed a
mechanical problem, which prevented him from delivering the tomatoes. He made a decision
to sell the tomatoes to people around the area where the vehicle had a fault. This was done
after failing to contact the company since all phones were switched off. Goagoses sold the
tomatoes at a loss. The company now wants to claim the lost money from Goagoses. Advise,
using legal principles, the chances of the company being successful in this suit. (30 marks).

ANSWER:
It has been submitted that Goagoses was appointed agent of the manufacturing company.
One of the types of agency relationship is that of necessity. The law presumes that an agent
has a certain amount of authority to handle an emergency for the principal. For this kind of
agency relationship to exist, the following must be present: The agent must have been placed
in control of the principal’s property, a genuine emergency must have arisen, which threatens
the property, it must be impossible for the agent to contact the agent to seek his instructions
and that the agent must have acted in good faith.
In the case of GREAT NORTHERN RAILWAY CO. V. SWAFFIELD (1874), the railway
company, through no fault of its own, was unable to deliver a horse consigned by rail. Unable
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to contact the owner, the company paid to put the horse in livery stable, and was held entitled
to recover the cost from the owner.
Reverting to the present case, we note that all the elements for the existence of agency of
necessity were present, as outlined above. Goagoses acted in good faith since in making sure
that tomatoes were sold though at a loss, as compared to have them all destroyed. Moreover,
he did everything to contact the company but no avail. This was an emergency that required
him to act very prudently.
We are therefore of the view that the company cannot succeed suing Goagoses since all he
was to the benefit of the company. The suit will therefore fail.

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