Actg 2P40 Business Law

Alberto sells antiques and collectibles.  He receives a telephone call from Sidra who is looking for “Picatto” cranberry glass pieces to add to her collection.  Alberto advised her that he had six Picatto cranberry serving dishes in stock and could obtain others from an antique wholesaler if required.  After describing the pieces to Sidra over the phone, she agreed to purchase them for $1,200.00.  Alberto shipped the glass to Sidra.  When it arrived she refused to accept the delivery telling the courier to return them to Alberto.  She claims that the pieces are of a darker colour than she had anticipated and do not match her existing collection and that two of the pieces are cracked.  Alberto comes to you for advice.  He claims that all of the pieces were in perfect condition when they were shipped and considered the pieces to belong to Sidra as soon as they were shipped and left his premises.

Required:  Explain the remedies, if any, to which Alberto is entitled.  Does Sidra have any legal basis for refusing to accept the goods?  How does “caveat emptor” and the provisions of the Sale of Goods Act apply?

Problem 2

Pat, Erica and Katharine have established separate advertising businesses.  Pat and Erica operate as sole proprietorships.  Katharine has incorporated a company, Katco Inc. to run her business.

Katharine was recently the successful bidder for the production of an advertising campaign for Mickey Best’s Beer (“MBB”), a brewery started by sports legend Mickey Best.  Since she did not have the resources to complete the campaign, she suggested to Pat and Erica that they complete the job together.

Pat, Erica and Katharine agreed that although the contract, as signed, was with Katco Inc., they would all contribute equal amounts of capital, staff and time and divide the profits equally, subject to a commission fee of $100,000.00 which would be payable to Katco Inc. for arranging the contract.

The campaign was successful with each of the parties earning $200,000.00.

On January 1, MBB told Katco Inc. that they would not be renewing the contract.  In response to her inquiries MBB revealed that it has signed an agreement with Patco Ltd., a corporation recently formed by Pat, for advertising services for the next year at a price of $300,000.00.

Erica and Katharine come to you for advice and want to commence legal action against Patco Ltd. and Pat for all profits, and/or an injunction to prohibit Patco Ltd. from proceeding with the contract. Pat claims that since Patco Ltd. is a new corporation, any past dealings which Pat may have had do not apply to Patco Ltd. and in any event that they were never partners and therefore all clients were “up for grabs”

Required:  Advise Erica and Katharine whether they have any basis to commence an action against Patco Ltd. or Pat.  Be certain to explain the applicable principles as part of your answer.  Would the situation be any different if Katharine (rather than Pat) was personally hired by the brewery as an in-house employee in charge of advertising?  Why or why not?

Problem 3 (25 marks)

Katharine and her family had brewed beer for years and, through a process of trial and error, had come up with a number of unique recipes.

As part of the contract with MBB, Katharine was to work with MBB’s brewers to create and market a new light beer.  Katco Inc. provided MBB’s brewers with the recipe for “Molly’s Great Draft”; a recipe originally created by her Aunt Molly.

Katco Inc. devised a marketing campaign around the new beer, shortening the brewer’s name to “Mickey’s” and promoting the beer as “Mickey’s Great Draft” and as “MGD”.

Shortly after the launch of the campaign, MBB was served with two lawsuits:

(i) Aunt Molly claims that she has patent rights to the formula for “Molly’s Great Draft” and sues for an accounting for all profits;

(ii) Miller Brewing Company claims that the use of the name “Mickey’s” and “Mickey’s Great Draft” infringe upon its trademark registration and brand names “Mickey’s”, “Mickey’s Fine Malt Liquor” and “Miller Genuine Draft”.  It further claims the initials “MGD” are a recognized nickname of their beer and that the use of all of the names infringes its intellectual property rights.

MBB claims that its beer tastes significantly different from Miller Brewing Company’s beer and that its marketing colours and logo are also significantly different.

Required:  Examine the legal principles and issues that will be considered as part of the lawsuits and the likely result.  Could MBB have avoided the problem by marketing the product as “Molly’s Great Draft”?  Would Aunt Molly’s consent be required?

Problem

Caroline, a 55 year old grandmother had been a legal secretary with the largest law firm in St. Catharines for 35 years.  As a result of her competence, hard work and sunny disposition she had earned the position of executive assistant to one of the firm's senior partners.  Caroline was paid an annual salary of $50,000.00.  On December 22nd last year, after a pleasant exchange of "good mornings" Caroline's boss requested that she get him a cup of coffee and bring coffee to the clients in the boardroom.  "Not likely" said Caroline, "It's not in my job description

Caroline was immediately fired.  She was escorted out of the office by three security guards and left on the street.  Her request to use a telephone to call a taxi was rejected.

Caroline commenced an action for unjust dismissal.  In addition, she has requested $100,000.00 in damages for the humiliation which she suffered.  At the trial one of the other legal assistants testified that Caroline had taken home office supplies which she had given to her grandchildren to complete their school work.  As well, she had typed and photocopied their assignments during working hours.  Finally, it was claimed that Caroline would regularly leave early (15-20 minutes) when her boss was out of the office.  Caroline acknowledged that this was all true, although she stated that she had left early on a "few" occasions and not "regularly".

She also testified that she had been unable to obtain similar employment (although a friend had offered her a retail clerking job at $25,000.00 per year).

Required:  Provide the judgment which would be rendered in this case with particular reference to the positions advanced by each of the parties.  If Caroline is successful, what damages would she receive?  Be certain to include an explanation of the applicable legal principles in your answer.