Western Environmental Inc decided to close down an oil refinery, which was its only substantial asset. It
Question:
Western Environmental Inc decided to close down an oil refinery, which was its only substantial asset. It therefore began to sell off the various pieces of equipment that were located within the refinery. On June 1, it sold a specific piece of pipe to Brendel Industries Co for $250 000. Under the terms of that contract, Brendel immediately paid the purchase price and promised to collect the pipe from Western's refinery within one month. Before Brendel did so, however, Western contacted another oil company, Fink Pipe Inc (Fink) with an offer to sell. Within two days, Fink had paid the purchase price and transported the pipe to its own facilities. A short time later, Brendel began to hear rumours of the deal between Western and Fink. Further investigation revealed a worstcase scenario. Not only had Western resold the same pipe to Fink, it had also ceased operations. Western's president had fled the country with all the company's liquid assets, leaving behind only an empty refinery and a mountain of debts. Brendel realizes that there is no point in suing Western. It has therefore sued Fink for the tort of conversion. Brendel insists that the pipe belongs to it. Furthermore, while admitting that Fink acted honestly when it dealt with Western, Brendel also insists that its own property rights in the pipe have been violated by Fink's actions in taking possession of the pipe. Does Brendel have a good claim in tort law? How does that claim relate to the Sale of Goods Act?
Step by Step Answer:
Managing the Law The Legal Aspects of Doing Business
ISBN: 978-0133847154
5th edition
Authors: Mitchell McInnes, Ian R. Kerr, J. Anthony VanDuzer