Question

Major Supply, Inc., is seeking a judgment against Les Danforth on the basis of a representation made by Dirk Coleman, in Danforth's presence, that they were in partnership together doing business as the D & C Trading Partnership. Major Supply received an order from Coleman on behalf of D & C and shipped $800 worth of goods to Coleman. Coleman has defaulted on payment of the bill and is insolvent. Danforth denies he is Coleman's partner and that he has any liability for the goods. Insofar as Danforth's liability is concerned, which of the following is true?
A. Danforth is not liable if he is not in fact Coleman's partner.
B. Because Danforth did not make the statement about being Coleman's partner, he is not liable.
C. If Major Supply gave credit in reliance upon the misrepresentation by Coleman, Danforth is a partner by estoppel.
D. Because the "partnership" is operating under a fictitious name (the D & C Trading Partnership), a filing is required and Major Supply's failure to ascertain whether there was in fact such a partnership precludes it from recovering.

Answer 1

Answer:

C. If Major Supply gave credit in reliance upon the misrepresentation by Coleman, Danforth is a partner by estoppel.