ICAS TC Business Law Module 6 Flashcards
Watteau v Fenwick 1893
Facts: A pub manager had no express authority to buy any goods for the pub other
than bottled beer and mineral water. He ordered cigars for the pub on credit but failed
to pay for them. The supplier raised an action for payment of the price against the
pub owner.
Held: The pub owner was liable because buying cigars fell within the usual authority
of a pub manager, and only if Watteau (the supplier) had been told of the limited
nature of the manager’s authority would the pub owner not have been bound.
International Sponge Importers Ltd v Andrew Watt & Sons 1911
Facts: A salesman sold sponges on behalf of International Sponge Importers (‘ISI’).
Usually payment was made to ISI by cheque by the customer but on several
occasions, Watt (‘W’) had purchased sponges from the salesman and made the
cheque out to him personally or paid in cash. ISI knew of this and raised no objection.
On one occasion, the salesman kept the cheque for himself and ISI tried to claim
against W for payment of the monies pocketed by the salesman.
Held: W did not have to pay. By failing to object to this series of irregular payments
the company had allowed W to rely on the ostensible authority of the salesman to
accept cheques made payable to himself.
Dudley v Barnet 1937
Facts: The tenants of a shop wanted to give up the lease and were looking for new
tenants to whom they could assign the lease. A firm of estate agents found new
tenants and arranged that they would take over the lease. However, the existing
tenants accepted an offer from another interested party and refused to pay
commission to the estate agents.
Held: The estate agents were entitled to be paid for their efforts in finding alternative
tenants although the arrangements made by the agents were not carried through by
the principal. The agent would also be entitled to remuneration if the contract was
not carried out due to the fault of the third party.
