Reference no: EM132224303

1. Evan Smith suffered a heart attack in the emergency room of Baptist Memorial Hospital after being given a dose of penicillin for a sore throat. Smith filed a lawsuit against the attending physician, as well as the hospital. The hospital did not consider the physician to be its agent or its employee; all physicians who treated patients at the hospital were considered by the hospital to be independent contractors. Physicians did not receive any employee benefits from the hospital, and they were responsible for the payment of their own taxes on the income that they earned from the hospital.

How would a court most likely rule on the issue of the hospital's liability for Smith's lawsuit?

a. The court most likely found that the hospital was liable for Smith’s claim, because an agency between the physician and the hospital had been created by estoppel.

b. The court most likely found that the hospital was liable for Smith’s claim, because the hospital had ratified the actions of the physician.

c. The court most likely found that the hospital was not liable for Smith’s claim, because based on the tax filings the physician was not the hospital’s agent.

d. The court most likely found that the hospital was not liable for Smith’s claim, because the physician was an independent contractor and thus solely liable to Smith.

2. Clifford Anderson was hired by Karl Bonelli of Sun Island Sales, Inc., to create a computer program for Sun Island to use in maintaining records of its cash receipts, inventory, and sales. Bonelli gave Anderson frequent instructions about what he wanted the program to do, and Anderson did most of the work at Sun Island’s office during fairly regular work hours. Anderson generally worked alone and enjoyed considerable autonomy in his work.

He was not paid regularly; he submitted occasional invoices to Sun Island for his work. Anderson did not receive employee benefits, and Sun Island did not withhold taxes or make Social Security payments on his earnings. When a dispute arose as to the ownership of the program that Anderson had created, the court had to first determine whether Anderson was an employee or an independent contractor.

Was Anderson an independent contractor or employee?

a. The court most likely held that Anderson was an independent contractor, because of his level of skill and because Sun Island did not withhold payroll taxes from payments made to him.

b. The court most likely held that Anderson was an employee, because Sun Island directed the creation of the program.

c. The court most likely held that Anderson was an independent contractor, because he kept regular hours.

d. The court most likely held that Anderson was an employee, because Sun Island reserved the right to assign Anderson other projects.

3. Fred Hash worked for Van Stavern Construction Company as a field supervisor in charge of constructing a new plant facility. Hash entered into a contract with Sutton Steel & Supply, Inc., to provide steel to the construction site in several installments. Hash gave the name of the principal on whose behalf he was making the contract as B. D. Van Stavern (which was the name of the president and owner of the firm) rather than as Van Stavern Construction Company.The contract and all subsequent invoices had only B. D. Van Stavern’s name, not the company’s name, on them.

Sutton delivered several loads, and the invoices for each load were signed by Van Stavern employees and paid with corporate checks written out to Sutton. Van Stavern was unaware that the materials had been purchased in his name and not in the name of the company. When Van Stavern failed to pay Sutton Steel for subsequent deliveries, Sutton Steel filed a lawsuit against Van Stavern personally for unpaid debts totaling $40,000. Sutton Steel claimed that Van Stavern had ratified the contracts of its employee, Hash, by allowing payment on the previous invoices.

How would a court most likely rule in this situation?

a. The court most likely held that Van Stavern had ratified the contracts, because he was an identified principal.

b. The court most likely held that Van Stavern had not ratified the contracts, because he did not have knowledge of all the material facts involved in the transaction.

c. The court most likely held that Van Stavern had not ratified the contracts, because he did not have legal capacity to enter into a contract for the purchase of steel.

d. The court most likely held that Van Stavern had ratified the contracts, because he expressly gave his approval for Hash to buy steel.