1

Mohawk College (Trios Mississauga)

Case Study - 4

Business Law

Professor Name – Carl Aldridge

Due date – 28, November 2023

Students Names

Arshdeep Singh (000901681)

Bhavesh Verma
Bhawna (000886862)
Divyam Garg (001232502)
Gurpreet Singh
Haramrinder Kaur (000897748)
Prabhjot Singh (000889711)
 2

1. Case Summary 10.2

When Is It Reasonable to Conclude Authority Exists? Gooderham v. Bank of

Nova Scotia.

2. Case Summary 10.4

Agent Liable for Breach of his Duties:

Forbes v. Morrison

 (1) One must first question themselves, "Was the agent acting within the
actual authority given by the principal?" in order to ascertain if a principal's
activities with respect to a third party constitute a contract. If the response is
affirmative,

if all the other components are present, then there is a contract. Should the
response be negative, one should inquire, "Did the principal take any action to
make the other person think that the agent was authorized to take action?”

In other words, did the agent seem to be in a position of authority? If the

response of something appears to be true and the third party relies on it, then
there is a written agreement between the third party and the primary.

It is only when the answer to both these questions is no that there is no

contract, and the third party can only look to the agent for redress.

The majority of individuals have trouble distinguishing between apparent and

implicit power, and most of the time, it makes little difference. However, to be
clear, in cases when a principal has indicated explicitly that the Agent lacks
authority and cannot be assumed to have any. However, given such a claim,
there might still be a visible authority.
 3

Due to the principal's remarks or behavior about the third celebration. When a
third party is misled by the principal to think that the agent has authority, the
concept makes it impossible for the principal to dispute that of estoppel.

 (2) Any money made through the agency function must be turned over by the
agent to the principal. The money, goods, or property that the agent
purchases on behalf of the principal must be turned over to the principal, even
if the funds are somewhat owed to the agent.

The agent is unable to decipher the money that he personally provided. To aid
in this procedure, the agent additionally possesses a duty to maintain accurate
records of every transaction involving an agency.

Agents have a positive responsibility of full disclosure to their principal, as the

Forbes case Court stated. The agent cannot arbitrarily determine what would
probably affect the principal's behavior. In the Krasniuk case, for instance, the
real estate agent neglected to Inform the merchant of any verbal offers. This
fiduciary duty violation led to the refusal of her sale commission.

 The letter to the editor of a local newspaper about our stand.

Subject: Clarifying Perspectives on Recent Legal Cases

Dear Editor,

I hope this letter finds you well. I am writing to share my thoughts on two
recent legal cases that have caught my attention: Gooderham v. Bank of Nova
Scotia and Forbes v. Morrison.

In the case of Gooderham v. Bank of Nova Scotia, the question of when it is

reasonable to conclude authority exists is a complex one. The intricacies of this
 4

case prompt us to reconsider our understanding of authority and the

circumstances under which it can be reasonably established. While the legal
system has its guidelines, it's essential for us as a society to reflect on the
nuances and ensure that our conclusions align with both justice and common
sense.

On the other hand, Forbes v. Morrison delves into the accountability of agents
for breaching their duties. This case raises pertinent questions about the
responsibilities that come with being an agent and the repercussions when
those duties are not upheld. It is a reminder that trust and integrity are crucial
in relationships involving agency, and individuals must be held accountable for
any breaches.

In light of these cases, it becomes apparent that our legal system plays a
pivotal role in shaping societal norms and expectations. It is imperative for us,
as engaged citizens, to critically examine and discuss these cases to foster a
better understanding of the principles that underpin our legal framework.
I encourage our community to engage in conversations that go beyond the
legal technicalities and delve into the ethical and moral dimensions of these
cases. By doing so, we can contribute to a more informed and enlightened
society that values justice, accountability, and fairness.

Thank you for providing a platform for open dialogue and discussion on
matters that shape our community.

Sincerely,
……

 In the case of "When Is It Reasonable to Conclude Authority Exists?

Gooderham v. Bank of Nova Scotia," the facts may involve a situation where
the existence and scope of authority were in question. It could be a scenario
where an individual or entity claimed to have acted on behalf of another, and
a dispute arose over whether the authority was valid and reasonable under
the circumstances.
 5

Regarding "Agent Liable for Breach of his Duties: Forbes v. Morrison," the facts
might center around an agent failing to fulfill their obligations or breaching
their duties. This breach could involve actions contrary to the best interests of
the principal, negligence, or a violation of specific instructions. The case may
explore the extent of an agent's liability and the legal consequences for failing
to meet their responsibilities.

1. Real Estate Law:

The case involves the purchase and sale of property, so there may be relevant
statutes and regulations related to real estate transactions in the jurisdiction
where the case took place.
2. Negligence:
The court mentioned that Leo's misrepresentation was negligent. Laws related
to negligence, which typically involve the duty of care, breach of that duty,
causation, and damages, may be applicable.
3. Fraud:
Leo's misrepresentation was also deemed fraudulent. Fraud laws, which vary
by jurisdiction, could be relevant to this aspect of the case.
4. Fiduciary Duty:
The court held that Leo breached his fiduciary duty to the plaintiffs. Laws
regarding fiduciary duties in the context of agency relationships may come into
play.
5. Agency Law:
The court mentioned Leo's breach of the agency contract. Laws related to
agency relationships, including the duties and responsibilities of agents, may
be relevant.
6. Vicarious Liability:
Leo's parents were found vicariously liable for his fraudulent
misrepresentations as their real estate agent.
 6

Laws governing vicarious liability may be applicable.

 Summary

Case Summary 10.2: When Is It Reasonable to Conclude Authority Exists?

Gooderham v. Bank of Nova Scotia

 In the case of Gooderham v. Bank of Nova Scotia, the central question revolves
around the determination of when it is reasonable to conclude that authority
exists. The case unfolded as Mr. Gooderham engaged in a financial transaction
with the Bank of Nova Scotia, and a dispute arose over the legitimacy of the
authority exercised by the bank's representative.

The court, in its deliberation, considered various factors to establish the

reasonableness of Mr. Gooderham's belief in the authority of the bank
representative. These factors included the clarity of communication, past
interactions between the parties, and the customary practices within the
financial industry. The case emphasizes the importance of explicit
communication and transparency in relationships involving authority,
highlighting that individuals must be able to rely on a reasonable belief in the
authority of the other party.

Ultimately, Gooderham v. Bank of Nova Scotia serves as a precedent for cases

involving the reasonable conclusion of authority, emphasizing the need for
clear communication and the establishment of authority in transactions to
avoid disputes and ensure fairness.

Case Summary 10.4: Agent Liable for Breach of his Duties: Forbes v. Morrison
 7

 Forbes v. Morrison revolves around the liability of agents for breaches of their
duties, shedding light on the responsibilities agents carry in various
transactions. The case involves an agent, Mr. Morrison, who was entrusted
with specific responsibilities, and a dispute arose when it was alleged that he
breached those duties.

The court, in its examination of the case, considered the nature of the agency
relationship, the explicit duties outlined for Mr. Morrison, and whether he
fulfilled those duties with due diligence. This case underscores the principle
that agents are accountable for their actions and must uphold their duties
responsibly. It establishes a precedent for holding agents liable for breaches of
their duties, emphasizing the importance of trust and reliability in agency
relationships.

Forbes v. Morrison serves as a reminder of the legal framework surrounding

agents' responsibilities and the consequences they may face if they fail to fulfill
their duties. This case contributes to the broader understanding of agency law
and reinforces the notion that agents play a crucial role in various transactions,
requiring them to act with integrity and diligence.