Question

Young was a purchasing agent for Wilson, a sole proprietor. Young had the express authority to place purchase orders with Wilson’s suppliers. Young conducted business through the mail and had little contact with Wilson. Young placed an order with Vanguard, Inc., on Wilson’s behalf after Wilson was declared incompetent in a judicial proceeding. Young was aware of Wilson’s incapacity. The applicable law is based on the Restatement (Second) of the Law of Agency. With regard to the contract with Vanguard, Wilson (or Wilson’s legal representative) will ______________.

Answer 1

Answer:

B. Not be liable because Young did not have authority to enter into the contract.

Explanation:

For a better understanding, I would go over specific details in this question. Wilson is the sole proprietor and from this question it is obvious that he is also Mr Young's client. Mr Young is the purchasing agent who despite knowing the court ruling on Wilson still went ahead to place this order with little contact from Wilson.

So since he did this, it is obvious that he acted on his own accord so Wilson or his representatives are not going to be liable for Young's actions.