Business Law Study Guide Seixas Seixas v Woods Canvas Seixas Seixas v Woods Plaintiff seeks remittance from agent who sold cheap wood as brazilletto wood Defendant agent who received misinformation from principal wood seller and advertised described and sold wood to plaintiff as such warranty n a written statement of good quality of merchandise clear title to real estate or that a fact stated in a contract is true An express warranty is a definite written statement and implied warranty is based on the circumstances surrounding the sale or the creation of the contract What constitutes a warranty Paraphrased from Seixas Seixas v Woods Gray area Courts have ruled that orally affirmed facts and even written descriptions accompanying an item for sale do not qualify as warranties But when a substantive fact is written emphatically in italics in the terms of sale such as free from encumbrances courts have upheld that it counts as a warranty and guarantees the vendee against all losses resulting from a failure of the warranty Plaintiff Counsel says We have a case against somebody here either the agent or the principal This is like the case of a captain of a ship who is an agent liable on his contract if he screws up the affected party has a triple remedy means to achieve justice the captain the ship and the principal However the possibility of the principal being liable does not exonerate the agent from his liability in the matter since he wrote the bill of parcels and sold the wood in his own name he is clearly answerable Defense says No warranty scienter or fraud defendant wood selling agent is not responsible to remit payment The contents of a bill of parcels are never obligatory The defendant showed the plaintiff all the evidence he had from the principal seller and neither one of them knew it was fake so the defendant cannot be held responsible for any wrongdoing All purchasers in presumption of law are deemed competent judges of what they are about to buy Main point of this case is the principle of CAVEAT EMPTOR buyer beware Latin Let the buyer beware A warning that notifies a buyer that the goods he or she is buying are as is or subject to all defects When a sale is subject to this warning the purchaser assumes the risk that the product might be either defective or unsuitable to his or her needs This rule is not designed to shield sellers who engage in Fraud or bad faith dealing by making false or misleading representations about the quality or condition of a particular product It merely summarizes the concept that a purchaser must examine judge and test a product considered for purchase himself or herself The modern trend in laws protecting consumers however has minimized the importance of this rule Although the buyer is still required to make a reasonable inspection of goods upon purchase increased responsibilities have been placed upon the seller and the doctrine of caveat venditor Latin for let the seller beware has become more prevalent Generally there is a legal presumption that a seller makes certain warranties unless the buyer and the seller agree otherwise One such Warranty is the Implied Warranty of merchantability If a person buys soap for example there is an implied warranty that it will clean if a person buys skis there is an implied warranty that they will be safe to use on the slopes A seller who is in the business of regularly selling a particular type of goods has still greater responsibilities in dealing with an average customer A person purchasing antiques from an antique dealer or jewelry from a jeweler is justified in his or her reliance on the expertise of the seller If both the buyer and the seller are negotiating from equal bargaining positions however the doctrine of caveat emptor would apply Burger King v Rudzewicz Supp Facts Burger King has its offices in Florida Conducts its business through the Burger King System franchise operation Burger King gives information about procedures specifications and methods to the Franchise owners and gives them assistance on marketing and management Franchises initially pay BK 40 000 and agree to pay monthly royalties promotional fees and rentals Contract specifies that relationship is governed by Florida Law Rudzewicz and MacShara of Michigan jointly applied to open a franchise but then fell behind on their payments BK headquarters terminated the franchise and ordered vacation of the premises BK sued them in the US District Court for the Southern District of Florida District Court concluded that it had jurisdiction and found that Rudzewicz and MacShara breached their franchise agreements and infringed BK s trademarks and service marks Eleventh Circuit Court of Appeals reversed the judgment and held that the district court did not have personal jurisdiction Issue Whether Personal Jurisdiction can be avoided due to not physically being in the forum State So long as a commercial actor s efforts are purposefully directed toward residents of another State we have consistently rejected the notion that an absence of physical contracts can defeat personal jurisdiction there Rudzewicz did not have any physical ties to Florida however the franchise dispute grew directly out of a contract which as a substantial connection with the state Rudzewicz s refusal to make the contractually required payments in Miami and his continued use of Burger King s trademarks and confidential business information after his termination causes foreseeable injuries to the corporation of Florida Judgment Rudzewicz established a relationship with BK s Florida headquarters and has failed to demonstrate how jurisdiction in that forum would otherwise be fundamentally unfair Conclusion District Court s exercise of jurisdiction did not offend due process BK still wins Mathias v Accor Economy Lodging Inc Text THINGS YOU NEED TO KNOW FROM THIS CASE Willful or wanton conduct The defendant knew about the problem In this case bedbugs but did nothing to correct the problem Therefore the plaintiffs were injured Compensatory damages awards the plaintiffs receive to compensate for the harm that was done to them Punitive damages Additional awards for the plaintiff to make sure the defendant doesn t keep doing what it is doing Relevance to this case Motel 6 had bed bugs they didn t get rid of them when they should have Mathias was bitten so they sued Motel 6 was found for Willful or Wanton conduct because they knew about the bed bug problem but never got rid of it
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