CASE 3

Harold Green and Herbert Green, who were unrelated persons with the same surname, carried on parcel delivery businesses in the same city. Each operated as a sole proprietor, under the name Green Delivery, and carried on business from the same warehousebuilding. The two men were good friends. They frequently assisted each other by carrying parcels for the other in deliveries outlying parts of the city. To complicate matters ies inthe two proprietors would sometimes use the spare truck owned by the other when their own vehicles breakdowns or required service. Apart from the had hat each had a different telephone number, it was impossible to distinguish between the two firms. Over dme regular customers oftenreferred to the two firms ollectively as "Green Brothers Delivery," even though the two men were not related to each other. Fiona, an antique dealer who frequently used the delivery services of both men, requested Harold Green to deliver an expensive antique chair toher country home. Harold Green, at the time of the request for pickup, advised Fiona that he would send his truck out to pick up thechair. However, Herbert Green picked up the chair at Fiona's place of business and took it to the warehouse for delivery. That day a fire of unknown origin destroyed the warehouse and its contents. The charred remains of the chair were found in the jointly usedpart of the warehouse after the fire. The chair had a value of $ 3,000. Each of the sole proprietors denied liability for the loss.

Advise Fiona as to how she might proceed in this case.

CASE 4

Williams, Oxford, Ogilvie, and Lennox carried on busi- ness in partnership for many years as wool merchants. The widespread use of synthetic materials, however, adversely affected the fortunes of the business. Eventually the partners found thatthe business could no longer be carried on at a profit. Before anything could be done to sell the business, Lennox became insolvent. It was then necessary to wind up the business in accor- dance with the partnership agreement. The partnership agreement provided that the par- ties share losses and profits equally. On dissolution, the capital accounts of the partners were as follows: Williams $ 50,000 $ 30,000 $ 20,000 Oxford Ogilvie Lennox Creditors' claims at dissolutionamounted to $ 350,000, whereas the total assets of the firm were $ 250,000.

Explain the nature of the liability of the firm. Calculate the liability of each of the partners as between themselves with respect to creditor claims.