Legal Question in Business Law in Indiana

Enforceable Contract?

As a follow up with additional information to the earlier question:

Company A has a sales representative B, that purchases 1 million dollars of material from A salesman C representing another company D.

Oder is confirmed by Company D to company email of B, who represents herself as with authority to purchase stock on behalf of Company A.

Company D brings the material into the country to ship to Company A. Salesperson C for company D inquires about shipping material into Company A now that it is here and general manager of Company A says that sales rep for that company A - Sales rep B had no authority to enter into a purchase on behalf of Company A and terminates sales rep B for company A after discovering this. Company A tells Sales rep C And Company D that it is not a valid order because there was no signed purchase order from company A. Sales Rep C was given verbally Company A purchase order number. Company D confirmed the order to sales rep B that was purported to be acting on behalf of Company A.

Is the purchase contract still enforceable?


Asked on 1/27/07, 5:11 pm

2 Answers from Attorneys
Samuel Hasler Samuel Hasler

Re: Enforceable Contract?

Frankly, it seems a close one and really needs a bit of research. It is unclear if the Company A is in Indiana or California. If in California, I will pass completely and suggest that you seek local counsel there.

If in Indiana, I would say that there was apparent authority to act but is it customary for the Business B or the industry to only ship upon a signed order? There are some fine points here that need research. Your company needs legal counsel and should be getting an attorney right away.

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Answered on 1/29/07, 12:09 pm
Matthew Mickelson Law Offices of Matthew C. Mickelson

Re: Enforceable Contract?

It may be an enforceable contract, but that depends on several factual issues that you have not detailed, including the level of authority normally given the employee in such situations. Please contact me if you would like to discuss this further.

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Answered on 1/29/07, 1:07 pm


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