Madison Development Corporation

Running head: CORPORATIONS LAW
CORPORATIONS LAW
Name of the Student:
Name of the University:
Author Note:

1CORPORATIONS LAW
Unit 9:
1. The present answer is to be answered in the light of the Sale of
Goods Act 1990. The main conditions that are to be considered by
the company when entering into purchasing agreement with the
manufacturer are as follows; that the seller has the right of selling
as given in section 13(a), that any goods to be sold by description
shall match the description through which they are sold under
section 14, the goods are suitable for the reason for which they are
bought by the purchaser provided the seller is aware of the purpose
of buying of the buyer under section 15, that the goods sold through
description possess merchantable quality and where the goods are
sold by sample, they must match the sample under section 16(2).
Further the company being the buyer in the case must be able to
have a quiet uninterrupted possession and enjoyment of the goods
as per section 13(b). Further as per section 13(c), the goods must
be free from any type of encumbrances.
In addition to all these, the Act also provides conditions together
with warranties in relation to transfer of rights and liabilities of
ownership from the buyer to the seller. Section 19 of the Act
provides the rules to be considered by the company in this case,
while dealing with the manufacturers.
2. The Sale of Goods Act 1990 can be applied only to the selling of
tangible goods. It does not cover sale of immovable properties or

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intangible goods like selling of land, selling of services or any type
of barter transaction. Since the main objective of the Act involves
giving protection to the contracting parties only, it fails to give any
sort of protection to the retail customers from the goods
manufacturers in case of breach of warranties. Further, the Act does
not provide any sort of protection to the parties involved in e-
commerce. Hence the Act must include all these to make it more
beneficial to the customers.
B. 1. The Canada Consumer Product Safety Act SC 2010, c 21 provides additional
duties on the industry for ensuring that it is not involved in marketing of products that
can be dangerous to the consumers particularly the children. The Act applies to the
products like children toys, house hold goods and also sporting goods. The killer candies
are the imported Asian candies having made from gelatin and fruit which are good for
children. Such candies not only impose danger due to presence of gelatin but also
because of its packaging, it also possesses danger of choking deaths. These are not
suitable for children below 3 years. In this regard, to safeguard the children, disclaimer is
attached to this type of candies that these can link with choking deaths. This product is
also insured for about 30 million dollars liability.
2. The products that can cause danger to children must be dealt with carefully by the
manufacturers and retailers both. They must ensure that the product must not cause any sort
of damage in their usual course of usage. They have a standard duty of care towards the
consumers who are children. Such duty must be exercised. Further, they have the duty to

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warn the users about the danger and also provide a clear idea as well as direction about using
the product safely. The manufacturer in these cases has mainly two options, either to
eliminate the potential harm or to warn the user. The Canada Consumer Product Safety Act
provides additional liabilities on the manufacturers to ensure that they are not marketing
goods that are dangerous to children. The Act also provides that goods to be used or
consumed by children must not contain any chemicals that can be dangerous to children.
C. 1. The compliance costs are very much required as many
manufacturers as well as suppliers can be dishonest about their products.
They can state many facts and information about their products which
may not be true always. Their intention is to sell their products for gaining
profits. This may lead them to the path of dishonesty. Hence, they should
be liable to pay compliance costs when they act dishonestly.
Caveat emptor means the ‘buyers be aware’ (Merkin & Devenney,
2018). The buyers must be aware about what they are purchasing,
whether the goods they are purchasing are good for the purchase
they are bought and others.
2. The above mentioned opinions would not differ even if the
transactions are carried out for business to business dealings
provided the transaction is honest and fair.
D. 1. The lawyer must advice the clients in a real estate business that
they must examine and check the property prior to its purchase, find
how the locality of such property looks like, what type of people stay

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there. Further, before purchasing the property, the manufacturer also
shall find out what financing options are available from any financing
institution.
2. The most likely method of financing for constructing a new
production facility will be probably seeking loan from a recognized bank
with low rate of interest.
E. 1. Comparing the given case study along with the facts in Stern case,
it is seen that in both of them, the owners mortgaged their property.
However, later on, they faced financial problems. As a result, the
mortgagees put the mortgaged property to sell for recovering money
under power of sale.
2. The case of Sterk v. Madison Development Corporation, 1985 CanLII
1213 had considered the Sterne case for dealing with the issue of
mortgagee’s responsibility to market the property properly in case the
mortgagor failed to do so.
In the given case study, Headrick can ask not paying 30,000 $ as
he first tried to find a job and when he could not, he took out time in
order to find out buyer for buying such property. Esson, his friend was
eager to purchase the property at 345000 $ which is much more than
the money obtained by selling it by the mortgagor.

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3. If it is proved by Headrick that the price of the property is more than
the selling price and if the mortgagor has knowledge about the actual
cost then he would not have to pay 30,000 $. He can also have Esson
as witness as he said Esson was ready to purchase the property for a
price of 345000 $.
F. 1. In the present case study, the rights of the manufacture must be
protected as per the contract signed by the engineer. The patent lies
under the Manufacture as the patent was used by the engineer.
2. the product can also be protected by using the right of trade marks.
G. In the present day, the movies and songs are readily available online.
One has to pay nothing to get hold of any song or movie. No one is
bothered to buy the original CDs or DVDs to watch any movie or listen to
any song. Moreover, several copies and versions of the same songs are
also made by various companies. One can easily click on a link in the
YouTube and hear and watch whatever is desired. Moreover, by using
YouTube converter, the song from the YouTube can be turned to a MP3
song.
Nowadays, everyone depends on interne very much. Due to this,
people have little access to the original artistic creations. In the mid 90’s,
it was seen that people purchase CD players, VCRs for playing CDs and
tapes. But in present days, people never do that. By downloading movies

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or music off the internet, crime is committed indirectly. Usually people
do not face any consequences as many people do it. There are definitely
advantages and disadvantages of downloading movies or music online.
People who are busy in work or personal life, often find it convenient to
just download it at one click in their computer, laptop or mobile phone.
As a result, they can watch them as and when they get time.
However, the artists or creators who put their hard work to make
such creation do not get any benefit out of this illegal downloading by
people. They usually publish their work online for public to enjoy it and to
appreciate it. But when someone else just copy and post it on their
channels, then the profit to be incurred by the original artist goes to the
hands of some other person who has no credit in such creation. The
artists have the right to be paid fairly but to ensure such fair payment;
they must opt for some option such that their creation can never be used
by others by just copying and pasting. They must use copyright on their
creations such that such creation is ensured to him only. Copying and
pasting of some other person’s work amount to stealing of such creation
and must be dealt seriously.
Hence in conclusion, it can be stated that law must be stricter to
curb this type of indirect stealing online. Further people must be made
aware of the fact they cannot be so busy that they will steal another
person’s creation for their own benefit. Further, the websites and

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applications must look into their privacy as well as protection policies
such that if anyone does any sort of stealing, serious actions can be
taken against them.
H. 1. The shareholders in the present case study can employ them in the
company. Further, the shareholders can make them sign an agreement
not to disclose the information of their company. This can be dealt with
the Employment Standards Act 2000.
2. The risks that can be incurred by hiring the employees previously
represented by Union that since they have been previously involved in
strikes, it can make them opt for strike whenever they will not anything
they had demanded from the company. This can be dealt in the light of
the Labour Relations Act 1995.
I. 1. In the present case, Amanda could claim that as she is working for
about 5 years in the store, she cannot be considered as a probationer.
Hence, she must be given the right as a confirmed employee of choosing
a particular day of not working without getting her salary deducted for it.
Moreover, her hours of work should not also be reduced for this. She can
also show that the shop has never done this previously with anyone else.
Further, she can claim that this was not present in the policy of the store.

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The store on the other hand, can claim that since working on Saturday
was a pre-decided condition for the full time employee, they have no
other option other than changing to her a part time employee.

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References:
Employees Standards Act 2000
Human Rights Code
Merkin, R., & Devenney, J. (2018). The contract formation under the caveat
emptor rule: assessing its utility. In Essays in Memory of Professor Jill
Poole (pp. 122-137). Informa Law from Routledge.
Sterk v. Madison Development Corporation, 1985 CanLII 1213
The Canada Consumer Product Safety Act SC 2010, c 21
The Labour Relations Act 1995
The Sale of Goods Act 1990