Andy works for Sparkles,a jewelry store.While selling a zircon-studded ring to a customer,Andy falsely states that the zircon is a diamond.The customer,delighted to find a diamond ring at an affordable cost,buys the ring.If the customer files a lawsuit for damages,which of the following will most likely be the court's verdict?
A)Andy had the actual and apparent authority from Sparkles to make true statements,hence Sparkles is liable for Andy's misrepresentations.
B)Andy will be held liable for the misrepresentation and will have to pay damages to the customer and to Sparkles.
C)The customer will be held responsible since he was negligent in the purchase,but may receive a small percentage of damages from Sparkles.
D)Andy will be held liable for the misrepresentation to the customer,and will have to pay him damages.

Question

Quizplus · Accepted Answer

In some states,a principal may be directly liable if she negligently allows the agent to make misrepresentations.Even where a principal is not directly at fault,she may be liable for an agent's misrepresentations if the agent had actual or apparent authority to make true statements on the subject.

Andy Works for Sparkles,a Jewelry Store