Saturday, May 17, 2014

Douglas v. Steele case brief summary

Douglas v. Steele case brief summary
Douglasses go to Travel House Inc (a corp)
give money to an agent Steele dba as Travel House Inc.
all the money goes to the Hawaii tour operator (which is bankrupt)
Hawaii then cuts a comission to Steele
Douglasses never get the tickets and sue Steele dba Travel House
Steele arg
under agency law she is not liable because she, Steele is not Douglas'es agent
claimss he has no relationship with Douglases under law
Steele says she may be the agent of tour operators but not of Douglasses
Douglas arg
Steele is their agent
consented to act under Douglas control for the limited duty of booking the trip
Steele is the agent of Douglasses
Steele consented to be their agent
Douglases control the transation
Steele is not agent of travel companies because they don't control her
one of the duties of the agent is not to get secret profits
here, since Steele is being actually paid by the tour operator, Hawaii there may be a problem
court says, that it's not secret profit because everyone is aware of the kickback
Agent's duties
Duty of care
in this case, duty to investigate the solvency of the company
Duty of Loyalty
here breached because she let the commission influence her behavior
why does the travel agent has to be the insurer to the client that the tour operators are solvent
burden of proof is on Douglasses to show that Steele could have investigated

1 comment:

  1. Douglas v. Steele, Ct of Appeals of Oklahoma (1991) (p. 7)
    a. A tour operator went bankrupt. Two issues:
    1. Can a judgment be entered against a travel agent described as doing business as a corporation?
    2. Can a travel agent be held personally liable for non delivery of a promised vacation by a 3rd party tour operator?
    b. What is the agent’s defense? Said she wasn’t an agent of the Douglas’s, but rather an agent of the Travel Haus.
    c. Court: Agent was acting as the Douglases’ agent when she made their travel arrangements.
    1. She had a duty to act with the care, skill, and diligence rendering that kind of service as would reasonably be expected.
    2. This included a duty to make a reasonable inquiry into the financial stability of the companies she was recommending.
    3. There were enough indicia that this company was problematic; didn’t conduct yourself according to the standards of the profession (what you’d expect a travel agent to do).
    d. Point of the dissent – think that the Douglas’s had a burden to make a prima facie case of an agency relationship. Needed to show that the agent didn’t conduct herself in accordance with the standards of the travel agent. Said that the Douglas’s didn’t make that case.


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