Ann, in the presence of Betty, tells Thomas that Ann is Betty’s agent. In reality, Ann has
no authority. Betty hears the statement, but she says nothing. In reliance, Thomas ships
goods to Betty on Ann’s order. Betty is liable even though no actual authority existed.
Sharp Finance Company has furnished Carl with some pre-printed forms for customers
to sign to finance repairs on their homes. After the customers sign the notes naming
Carl as the payee, he sells them to Sharp Finance. Sometimes Carl is busy and does a
poor job on the homes so he can get on to the next job. When customers complain, he
says he’ll get around to it. If the customers don’t pay the note, Sharp Finance sues them.
Can the customers use the defenses they have against Carl against Sharp Finance?
Explain what law or laws apply to this situation.
If Carrie, age 14, contracted to buy a fur coat by mail, the coat manufacturer would not
have to send it since the contract was void.