Jigsaw Legal Aspects Of Purchasing Iowa State Scm 486 Homework

1219 words - 5 pages

Nolan Hickey, Ashley Lane, Leah Widdel, Alex Rogers SCM 486
Module 3: Legal Aspects of Purchasing
Print a copy and keep it with you until we discuss it in class
Nolan- What are the three types of, “Purchasing Authority?” Give one example of each.
1. Express Authority
a. One type of purchasing authority is express authority, which is “conferred
to the purchasing manager by the principal.” An example of express
authority is real estate contracts.
2. Implied authority
a. The second type of purchasing authority is implied authority, which is
“implied by the law at the time the principal grants express authority to the
purchasing agent.” An example of implied authority includes the quantity,
quality, delivery conditions, price, and payment date under an express
3. Emergency authority
a. The third type of purchasing authority is emergency authority, which is
where the purchasing agent can take emergency action even if they do
not have express or implied authority. An example of emergency authority
is where the principal’s property or rights are in danger and can be
protected even if a consultation is not possible with the principal.
What is the document at a workplace where it is most common to find the, “Expressed Authority,” given
to the buyer?
The document at a workplace where it is most comment to find the, “Expressed
Authority,” given to the buyer is the job description.
Nolan- If you become a buyer, what requirements should you make sure are met so that you are not
held liable for purchases made by you?
1. One requirement is that the name of the company or principal should appear on
the purchasing documents.
2. Another requirement is that all parties involved should know that I, as an
individual purchasing agent, is representing my organization.
3. Thirdly, the agency relation should appear on all purchasing documents.
4. Lastly, that I, the agent is acting within the realm of my authority for all
Nolan Hickey, Ashley Lane, Leah Widdel, Alex Rogers SCM 486
Leah- The four components of an enforceable contract are (make sure that you can explain what they
mean also):
1. “The parties must be capable” – This means that all parties involved know what
they are doing, are in the right state of mind, and are not under the influences of
drugs, alcohol, etc.
2. “The subject of the matter must be legal and valid” – This means that all products
or services being dealt on by a contract must be legal products or services in the
areas the agents do business in. All governmental regulation must be followed.
3. “There must be mutual consideration” – This means that there is an agreement
between both parties on the value and exchange of what is covered in the
contract. For example, if we agree on $10,000 for ten freezers. One party
acknowledges giving the value in exchange for the ten freezers as a good and
vice versa.
4. “The parties much reach an agreement by offer and acceptance” – This means
that the contract is not...

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