Question
Mary appointed Edwin as her agent to sell a painting on her behalf. Mary gave strict instructions to Edwin not to sell the painting for
Mary appointed Edwin as her agent to sell a painting on her behalf. Mary gave strict instructions to Edwin not to sell the painting for less than $150,000. Edwin contacted Howard, an art dealer, to see if he was interested to purchase Mary's painting. As the original painting was kept by Mary, Edwin had to arrange a meeting between Howard and Mary to view the original painting. Edwin was sick on the day of the meeting, and therefore Howard met with Mary directly. When Howard saw the painting, he was impressed by its quality and wanted to buy it. Seeing Howard's keen interest, Mary told him the following: "We are exploring multiple offers by interested buyers. If you are interested, Edwin is my agent to handle this transaction, so he will continue to liaise with you." The next day, Howard contacted Edwin to express his interest to buy the painting. Edwin forgot about Mary's previous instruction not to sell the painting for less than $150,000. Instead, he entered into a contract with Howard to sell the painting for $100,000. (a) Describe and explain two (2) ways in which the agency relationship between Mary and Edwin could have arisen in the above scenario. Support your answer with specific examples based on the above scenario. (b) Discuss whether Edwin has breached any duty as an agent. You are only required to discuss one (1) duty that Edwin may have breached.
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