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Woodridge USA Properties, L.P., bought eighty-seven commercial truck trailers from Southeast Trailer Mart, Inc. (STM). Gerald McCarty, an independent sales agent who arranged the deal, showed Woodridge the documents of title. The documents did not indicate that Woodridge was the buyer. Woodridge then asked McCarty to sell the trailers, and within three months, they were sold. McCarty did not give the proceeds to Woodridge. Woodridge without mentioning the title documents asked STM to refund the contract price. STM refused. Does Woodridge have a right to recover damages from STM? Explain. (See Remedies of the Buyer or Lessee)
Answer this using the IRAC writing Format
a. Describe the issue at hand (the question being asked)
b. Describe the rule that is applicable in this situation
c. Apply the rule to the facts of your situation
d. Draw a conclusion

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Answer:

a. Describe the issue at hand (the question being asked)

Does Woodridge have a right to recover damages from STM?

This is the main issue of the question, since Woodridge is requesting STM for a refund for the 87 trucks that they bought previously.

b. Describe the rule that is applicable in this situation

This case refers to an agent-principal situation where McCarty was Woodridge's agent and he basically committed fraud against Woodridge. But Woodridge instead of going after McCarthy decided to go after STM which was the original seller of the trucks.

c. Apply the rule to the facts of your situation

Did McCarthy have the authority to sell the trucks? Yes, McCarty had the explicit authority to sell the trucks as Woodridge's agent. McCarthy had to fulfill an agent's duties with Woodridge? Yes, McCarthy was an acting agent and as such should have acted on the principal's best interest.

d. Draw a conclusion

Woodridge has no right to recover damages from Southeast Trailer Mart, Inc. (STM).

What happened here is that Woodridge bought the 87 trucks from STM and McCarty was the independent sales agent that carried out the operation. Then instead of doing all the proper paperwork at registering the trucks as their property, they decided to resell them using McCarty as an independent sales agent again.

Then McCarty, who wasn't STM's agent, resold the trucks and kept the money for himself. First of all, Woodridge never had title of the trucks and then it resold using an independent sales agent, so STM has no relation to Woodridge's bad decision.