Question
Profit Corporation authorized Anderson, an employee, to find a buyer for used equipment that Profit intended to sell. Anderson believed that he had authority to
Profit Corporation authorized Anderson, an employee, to find a buyer for used equipment that Profit intended to sell. Anderson believed that he had authority to contract for the sale of the equipment, but in fact he did not. Anderson found a prospective buyer, Caveat Corporation, and contracted with Caveat on behalf of Profit for the sale of the equipment to Caveat. In this contract, Anderson warranted that the equipment was fit for Caveat's particular needs. A responsible officer of Profit read the contract and directed that the equipment be shipped to Caveat. The equipment did not meet the special needs of Caveat, and Caveat refused to pay for it. Profit sued Caveat for the contract price. What legal arguments will each side make. What is the likely outcome of this case and why?
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