32. Algol and Altair are keen to get their Tasmanian souvenirs sold in Queensland. They meet a Cairns businessman, Greg, at a conference and, after much talk, but with nothing in writing, they come to the following business arrangement: Beacon Fun Stuff Pty Ltd is to supply Greg with a range of their most popular souvenirs but the items remain the property of Beacon Fun Stuff Pty Ltd and will be displayed as such; Greg is to sell the items to his customers and pay Beacon Fun Stuff 85% of the proceeds.

Required: What is the legal nature of Beacon Fun Stuff Pty Ltds and Gregs arrangement? Would it be different if Beacon Fun Stuff Pty Ltd were to simply sell souvenirs to Greg?

Questions to Consider:

Has an agency agreement been reached between Beacon Fun Stuff Pty Ltd and Greg?

Has an agency agreement been expressly created?

Does an agency agreement have to be created in writing or can it be created orally?

Who is the principal in such an arrangement?

If Beacon Fun Stuff Pty Ltd sells souvenirs to Greg, is there any contractual relationship between Beacon Fun Stuff Pty Ltd.s and Gregs customers?

Is this an issue of privity of contract?