MacKintosh Salesperson Business Law Questions

Please review key terms and answer question 1 at the end of chapter 13,question 2 at the end of chapter 14 and question 7 at the end of chapter
15. Please cite to specific eText pages where you found
support for your answers.
Question 1:
Lester purchased a used automobile from MacKintosh Motors. He asked the seller if the car had ever
been in a wreck. The MacKintosh salesperson had never seen the car before that morning and knew
nothing of its history but quickly answered Lester’s question by stating: “No. It has never been in a
wreck.” In fact, the auto had been seriously damaged in a wreck and, although repaired, was worth
much less than the value it would have had if there had been no wreck. When Lester learned the truth,
he sued MacKintosh Motors and the salesperson for damages for fraud. They raised the defense that
the salesperson did not know the statement was false and had not intended to deceive Lester. Did the
conduct of the salesperson constitute fraud?
Question 2:
William E. Story agreed to pay his nephew, William E. Story II, a large sum of money (roughly equivalent
to $75,000 in 2016 dollars) “if he would refrain from drinking liquor, using tobacco, swearing, and
playing cards or billiards for money until he should come to be 21 years of age.” William II had been
using tobacco and occasionally drank liquor but refrained from using these stimulants over several years
until he was 21 and also lived up to the other requirements of his uncle’s offer. Just after William II’s
21st birthday, Story acknowledged that William II had fulfilled his part of the bargain and advised that
the money would be invested for him with interest. Story died, and his executor, Sidway, refused to pay
William II because he believed the contract between Story and William II was without consideration.
Sidway asserted that Story received no benefit from William II’s perfor-mance and William II suffered no
detriment (in fact, by his refraining from the use of liquor and tobacco, William II was not harmed but
benefited, Sidway asserted). Is there any theory of consideration that William II can rely on? How would
you decide this case? [Hamer v. Sidway, 124 N.Y. 538]
Question 7:
Siddle purchased a quantity of fireworks from Red Devil Fireworks Co. The sale was illegal, however,
because Siddle did not have a license to make the
purchase, which the seller knew because it had been so informed by the attorney general of the state.
Siddle did not pay for the fireworks, and Red Devil sued him. He defended on the ground that the
contract could not be enforced because it was illegal. Was the defense valid? [Red Devil Fireworks Co. v.
Siddle, 648 P.2d 468 (Wash. App.)]
Student Responses
Student 1:Martnia
1. I believe that Leonard had the right to sue Globe Life Insurance Company. Mainly because
when she signed the contract she wasn’t in the right state of mind. Leonard doesn’t have to pay
for the life insurance because she was under the influence of alcohol and had also taken
tranquilizers the night before at the hospital and an additional one an hour before Raskin had
arrived at her house. In which she signed the contract not knowing or having knowledge of what
it said. Leonard wasn’t in the right state of mind at all. I don’t think Leonard even remembered
signing the contract because when the first month’s bill for the insurance came she sounded
surprised and said ” I didn’t buy any life insurance! Where did this come from?” According to the
law “a factual incapacity contrasts with incapacity imposed because of the class or group to
which a person belongs.” (Twomey, M. M., et al. (2021) page 249). “A factual incapacity may
exist when because of a mental condition caused by medication, drugs, alcohol, illness, or age,
a person does not understand that a contract is being made or understand its general nature.”
(Twomey, M. M., et al. (2021) page 249). “If the degree of intoxication is such that a person
does not know that a contract is being made the contract is voidable by that person.” (Twomey,
M. M., et al. (2021) page 253). “On becoming sober, the individual may avoid or rescind the
contract .” (Twomey, M. M., et al. (2021) page 253).
2. The Globe Life Insurance Company targeted the houses where children were killed by driveby shootings. Many of the victims had other siblings in the home. The sales representative’s job
was to sell policies to the parents for their other children, I found the Globe Life Insurance
Compan to be insensitive and take advantage of a parent who was going through a lot of
emotional pain of losing their child.
3. The legal issue involved in Raskin’s decision to target Leonard is that he should pay legally
mainly because on purpose he went after Leonard a day after her son’s death. In which Leonard
was crying and with a lot of emotional pain for the loss of her son. Raskin definitely took
advantage of the situation and made Leonard sign the contract while she was in the process of
making funeral arrangements for her son.
~Nia M.
Reference:
Twomey D. P., Jennings M. M., & Greene S. M. (2021). Aderson’s Business Law & The Legal
Environment – Comprehensive Edition. [VitalSource Bookshelf]. Retrieved
from https://online.vitalsource.com/#/books/9780357363850/
Student 2: Delia Exantus
No, she did not have to pay for the life insurance. She was not in the right state of mind when it was
made, therefore, the contract is void. This has to do with factual incapacity. According to the
PowerPoint and the text, factual incapacity is mental incompetence due to drugs, alcohol, illness, or age.
Leonard had multiple drugs in her system. She had taken multiple tranquilizers the night before, as well,
as an additional 16 more tranquilizers and a beer. With pills, it is always best to take them with water,
because alcohol can interfere with the pill itself. Evidently, as said before, Leonard was mentally
impaired at the time that she signed the life insurance form. I think that it should also go without
mentioning that she was grieving as well. Grief is a powerful distractor. Her mind was already distracted
due to the drugs and alcohol, however, because of grief, her mind is even farther gone.
I think that there are many ethical issues involved with this. I think that Globe salespeople prey on
grieving families to try and take their money by convincing them that they need life insurance. As said
before, grief is powerful and can make you do things that you didn’t even see yourself doing. I think that
this may be a bit of a stretch, but I feel that this should be considered emotional duress. The whole
concept of targeting families who lose small children right after they pass is just so wrong on so many
levels. It’s almost as if they are using the children as a scapegoat for their own agenda. Emotional duress
is when one is induced by a wrongful act or threat of another to make a contract that deprives one of
the exercises of their own free will. This definition allows me to say that my answer is a bit of a stretch.
However, emotion plays a huge role in the ethics and the legal issues involved in the Globe’s Sales
Program.
References
Twomey, D. P., Jennings, M. M., & Greene, S. M. (2021). Anderson’s Business Law & The Legal
Environment – Comprehensive Edition (24th Edition). Cengage Learning US.
https://online.vitalsource.com/books/9780357363850
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