For an agency agreement to be binding between the principal and agent, what is required and what is the effect if a required element is not met?

Exam Instructions
Part 1
Please answer the following
questions in about 200 words. (10 points* 7 questions=70 points)
1. For an agency agreement to be binding
between the principal and agent, what is required and what is the effect if a
required element is not met?
2. Discuss the role of the Partnership Act as
it relates to people carrying on joint business activities.
3. Explain under what circumstances an agent
can be liable for his conduct rather than the principal.
4. Despite its organizational simplicity, sole
proprietorships must satisfy many federal, provincial, and municipal
requirements to carry on business. List and describe three regulatory
5. Contrast the obligations and duties of
directors and shareholders of a corporation.
6. To what does the term “due
diligence” refer?
7. Discuss the role of strikes, lockouts, and
picketing, and whether or not they have any place in our present society.
Part 2
Case Analysis Questions: For each of
the following questions provide a brief fact sheet, legal issues and analysis.
(10 points * 3 questions= 30 points) 300-400 per question
a) Joe
is a shareholder of XYZ Corporation, an extremely profitable corporation in the
software business, and was upset when the directors of the corporation refused
to declare a dividend again, ploughing the money back into research and
development. Joe sued, along with several other shareholders, claiming that
there was no excuse for withholding dividends under these circumstances.
Explain the likely outcome.
b) Joe
is an environmental activist and he acquired shares in Big Forestry Ltd. (a
forestry corporation), only for the purpose of undermining Big Forestry Ltd. by
speaking against their practices at annual shareholders’ meetings and getting
access to confidential information. Joe spoke against Big Forestry Ltd. at
every opportunity. Explain his legal obligations to the corporation under these
a) Joe
worked for Harry’s Fine Toys for a period of six years. In September, he left
Harry’s Fine Toys and went to Sam’s Toy Shop, a competitor, and disclosed
Harry’s Christmas line of toys. What could Harry do under these circumstances?
b) Joe
wanted to start up a restaurant business. He did some research and found out
McDonald’s had not properly registered its trademark, the golden arches, in his
particular area. Joe used a similar pair of arches over his restaurant and
started business. Explain any danger he might face.
a) Joe
verbally agreed with his landlord to a two-year lease for an apartment. Only
five months later, the property was sold to somebody else. The new owners gave
Joe three months to vacate the premises. Explain Joe’s legal rights under these
b) Joe
bought a car from Harry’s Fine Car Lot and owed him $5000 on the deal, which he
was paying back at $500 a month under a Security Agreement. Harry assigned that
Security Agreement to Ace Finance Company, and they served notice on Joe that
he was to make his payments in future to them. Joe knew, however, that his deal
was with Harry, and he ignored the notification and continued to make the
payments to Harry. What danger does he face in these circumstances?

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