Question
Jason, who has graduated from automotive program, and Gerry who is a businessman entered into a partnership business of auto repair shop. In their partnership
Jason, who has graduated from automotive program, and Gerry who is a businessman entered into a partnership business of auto repair shop. In their partnership agreement, Gerry will provide on the financing and administration while Jason will act as active partner and in-charge of running the operations of the business. The agreement also stipulates that the firm should not engage in the buying and selling of vehicles. Due to financial needs, Jason sold a vehicle belonging to a customer who had left it with the firm for repair and without the knowledge of the owner. Later, the car was recovered by the owner from Jack, who is the innocent buyer. Jack sued Jason for breach of implied condition under the contract of sale that the seller has clean title of the goods. The court ruled that based on partnership law: A. Each partner is an agent for the other partners; therefore, Jason was as agent of Gerry and acting under the apparent authority. Gerry is liable to compensate Jack. B. Each partner is an agent for the other partners; therefore, Jason was as agent of Gerry and acting under the actual authority. Gerry is liable to compensate Jack. C. Each partner is an agent for the other partners. Since there is an expressed agreement that the firm is not allowed to engage in buying and selling, therefore, Gerry is not liable. D. Each partner is an agent for the other partners; therefore, Jason was as agent of Gerry and acting under holding authority. Gerry is liable to compensate Jack
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