Discussion Question Part I
Select one of the scenarios listed below and explain the best solution for each. Include comments related to any ethical issues that arise. You should locate at least one scholarly source from the SUO Library or one case that has been decided or is currently pending to support your answer.
Scenario 1 – Warranties
Michael, a mechanic, needs to install a 2,000-pound machine in his shop. The installation will require lifting the equipment to the second story. Michael goes to Home Depot and tells Brett, the manager, that he needs some heavy-duty chain to be used in his auto repair shop. Brett recommends a half-ton chain, which Michael purchases. Michael attached the chain around the piece of equipment and attempted to lift the equipment off the ground. Suddenly, the chain breaks. The equipment crashes to the ground and is severely damaged. Michael learned that he needed at least a one-ton chain for the job. Michael files a suit against Brett and Home Depot for breach of the implied warranty of fitness for a particular purpose.
Scenario 2 – Accountant’s Liability
Walker, the CEO of Memphis Mini Golf and Go Carts (MMGGC), wanted to sell the business to Go Carts, Golf & Games. To provide a basis for the transaction, Walker retained Blanchard, an accountant, to conduct an audit of MMGGC. Blanchard was aware that Go Carts, Golf & Games would likely use the audit report in consideration of the purchase of the business from MMGGC. Blanchard’s audit report showed that MMGGC’s business was profitable. William, Go Cart’s president, relied on this report in agreeing to purchase the business of MMGGC and in agreeing to the terms of the purchase. Sometime later, it was discovered that the accountant made a number of mistakes and that the business that was sold was actually insolvent. William and Go Carts sued Walker and Blanchard for damages. The suit claimed that the accountant had negligently misrepresented the facts.
Discussion Question Part II
In two to three paragraphs, provide the following information about the business you created in Week 1.
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