Smith and Roberson’s Business Law
Smith and Roberson’s Business Law
17th Edition
ISBN: 9781337094757
Author: Richard A. Mann, Barry S. Roberts
Publisher: Cengage Learning
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Chapter 11, Problem 7Q
Summary Introduction

To discuss: Whether person P will be successful.

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Kate owned a small grocery store. One day John went to the store and purchased a can of chip dip that was, unknown to Kate or John, adulterated. John became seriously ill after eating the dip and sued Kate for damages on the grounds that she breached an implied warranty of merchantability. Is Kate liable? Why?
Abigail is in the business of selling fine antiques. Abigail purchased an antique desk for $5,000 from Jackson, and gave a promissory note for payment. Concerned that Jackson might not accept the note, Abigail had her friend Catalina sign the promissory note as well. Jackson accepted the note as payment. Two weeks later, Jackson sought payment on the note. Abigail told Jackson that she is not responsible for the promissory note because Catalina signed the note too, and Jackson had to seek payment from Catalina first. Abigail also spotted a beautiful set of vintage chairs owned by Max that would be perfect for her store. Abigail wrote a $10,000 check, also signed by her business associate Orville as an accommodation party, to Max to pay for the chairs. Max presented the check to Westville Savings, the bank where Abigail has a checking account, for payment. Westville Savings dishonored the check claiming Abigail had insufficient funds. Who is liable for these negotiable…
John Torniero was employed by Micheals Jewelers, Inc. (Micheals).  During the course of his employment, Torniero stole pieces of jewelry, including several diamond rings, a sapphire ring, a gold pendant, and several loose diamonds.  Over a period of several months, Torniero sold individual pieces of the stolen jewelry to G&W Watch and Jewelry Corporation (G&W).  G&W had no knowledge of how Torniero obtained the jewels.  Torniero was arrested when Micheals discovered the thefts.  After Torniero admitted that he had sold the stolen jewelry to G&W, Micheals attempted to recover it from G&W.  G&W claimed title to the jewelry as a good faith purchaser for value. Micheals challenged G&W’s claim to title in court.  Who wins?  Explain your reasoning.
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