Case assignment
Sadooh_77Name: But we already paid
Facts
1. An authorized agent who receives loyalty payments on behalf of an entity acts in the same capacity as the actual authority, which, in this case is duPoint.
2. Any defaulting on the side of the authorized agent does not affect the parties that are making the payments, for they are not legally liable.
3. Enjay and Johnson & Johnson have paid the royalties and whether duPoint’s authorized agent remits the amount to the principle or embezzles it is immaterial.
Issue
Although Enjay and Johnson & Johnson made the payments as required by duPoint, the receiving company did not get the money. duPoint’s authorized agent did not remit the whole amount, for he/she made tampered with the checks and made himself the payee, and went ahead to cash the checks and use the money as an individual. duPoint did not receive the royalties in totality.
Conclusion
When a company gives an authority to an agent to carry out duties on its behalf, the entity enters into a legal relationship that makes the entity an apparent authority who has the same legal effect as the actual authority. Therefore, Enjay and Johnson & Johnson have no case to answer for their records show that they had already made their payments to the agent authorized to receive the payment.
Reason
In this case, defendants had paid the royalties already to the agent that duPoint had authorized as its apparent authority to receive the checks on its behalf. Therefore, whether the authorized agent remitted the amount he/she received from the defendants or not is unrelated to the defendants making the payment. From a legal perspective, the defendants made the payments, and duPoint received the money.