BUSINESS LAW II notes BBM 215 Moi University

Course Purpose/Objectives

The course is intended to equip students with legal knowledge relating to Commercial and Property Law.

Course Objectives

  1. To equip learners with the knowledge on Law of agency contracts and partnerships
  2. To enable learners understand Sale of Goods law and Negotiable Instruments
  3. To impart learners with the skills to explain hire purchase laws, insurance laws and
  4. Carriage of Goods
  5. To equip learners with attitudes to appreciate the Intellectual Property and property laws

Expected Learning Outcomes

By the end of the course, students should be able to:

  1. Understand to agency contracts and partnerships
  2. Understand Sale of Goods law and Negotiable Instruments
  3. Explain hire purchase laws, insurance laws and Carriage of Goods
  4. Understand the Intellectual Property and property laws

TOPIC 1: LAW OF AGENCY

  • What is Agency?
  • Parties to an agency relationship- Principal, Agent and Third Party
  • Essentials features of agency relationship
  • Agency and other contractual relationships; sale agents/trust/employment/bailment
  • Types of Agents; Mercantile, del credere, commercial
  • Creation of Agency; Express, implied, necessity, ratification, cohabitation, estoppel
  • Powers of Agent; Actual, implied, ostensible, emergency and customary
  • Rights and Duties of an Agent and Principal
  • Obligations of an Agent and the Principal in the case of undisclosed principal
  • Termination of Agency

REFERENCE INDIAN CONTRACT ACT 1872

TOPIC 2: LAW OF SUPPLY AND SALE OF GOODS:

  • Definition of good(s)
  • Formation of the contract;
  1. Contract of sale of goods and agreement to sell
  2. Classification of Goods; Existing/future or ascertained/unascertained
  • Capacity; minors/drunkards/persons of unsound mind/corporations and the application of the concept of necessaries and reasonable price
  1. Price
  2. Conditions and Warranties
  • Effects of the contract
  1. Transfer of property in unascertained goods
  2. Transfer of property in ascertained goods
  • Rules for ascertaining intention as to time when property is to pass
  1. Reservation by the seller of right of disposal
  2. Transfer of property by a person not owner(Doctrine of nemo dat quod non habet”
  • Performance of the contract
  1. Duties of seller and buyer
  2. Rules as to delivery of goods
  • Delivery or wrong quantity or description of goods
  • Rights of unpaid sellers
  1. Who is unpaid seller
  2. Sellers lien
  • Stoppage in transitu
  1. Right of resale
  • Actions for breach of the contract
  1. Remedies of the seller- Action for price and action for non-acceptance
  2. Remedies of the buyer- action for non-delivery, specific performance, breach of warranty and special damages.

REFERENCE: SALE OF GOODS ACT CAP 31 L.o.K

TOPIC 3: HIRE PURCHASE:

  • Distinction between Hire Purchase, Hire and Contract of Sale of Goods
  • Formation of Hire Purchase Agreements and registration
  • Implied Conditions and Warranties under Hire Purchase Agreements
  • Termination and completion of Hire Purchase Agreements
  • Recovery and repossession of goods under Hire Purchase Agreements

REFERENCE: HIRE PURCHASE ACT CAP 507 L.o.K

TOPIC 4: LAW OF PARTNERSHIPS:

  • Introduction
  1. Definition of Partnership Section 3(1)
  2. Types of partners
  • Legal status of Partnership
  1. Legal personality
  2. illegal partnerships
  • Capacity
  1. Firms name
  • Formation of partnership
  1. Partnership agreement
  2. Alteration of partnership deed
  • Passing off
  • Rules for determining existence of partnership business
  • Relations of partners with third parties
  1. Power of partners to bind firm
  2. Power of partner to bind all partners
  • Liability of partners
  1. Liability of minor
  • Relations of partners to one another
  1. Rights and duties of partners; account, compete, private profit
  2. Partnership property
  • Expulsion
  1. Retirement
  • Dissolution ; expiry, bankruptcy, illegality, court, order, notification by partners

REFERENCE: PARTNERSHIP ACT CAP 29 L.o.K

TOPIC 5: LAW OF NEGOTIABLE INSTRUMENTS:

  • Definition of Bill of Exchange; Cheque and Promissory note
  • Other types of negotiable instruments; Treasury Bills, Share Certificates, Dividend
  • Warrants, Letters of Credit
  • Features of negotiable instruments
  • Parties to a negotiable instrument
  • Types of Bills; Order, bearer’s, non-transferable, inland, foreign, inchoate
  • Holders of a bill of exchange; holder for value, holder in due course
  • Crossing of cheques
  • Duties of account holders (bank customers) and the banker
  • Protection of collecting and paying banker

REFERENCE: BILL OF EXCHANGE ACT CAP 27 and THE CHEQUES ACT CAP 35

TOPIC 6: BANKRUPTCY LAW:

  • What amounts to an act of bankruptcy in Kenya? Section 3(1)
  • Effects of bankruptcy
  • Creditor petition and procedure of bankruptcy
  • Appointment of a receiver and his/her powers
  • Distribution of property and settlement/scheme/ composition and the order of priority in distribution of the debtor property
  • discharging bankruptcy

REFERENCE: BANKRUPTCY ACT CAP 53

TOPIC 7: LAW OF PROPERTY:

  • What is property?
  • Classification of properties
  • Forms of Land Tenure in Kenya
  • Classification of interests in land in Kenya

REFERENCE: THE LAND ACT, 2012 NO. 6 OF 2012BBM 215: BUSINESS LAW II COURSE MATERIALS

TOPIC 8: LAW ON CARRIAGE OF GOODS:

  • Definition of contract for carriage of goods
  • Classification of carriers; Common Carriers and Private Carriers
  • Duties/rights and liabilities of common carriers
  • Bill of lading and charter party
  • Carriage of Goods by Air and Airway Bill.

REFERENCE: CARRIAGE OF GOODS BY SEA ACT CAP 392 CARRIAGE OF GOODS BY AIR ACT CAP 2

TOPIC 9: LAW OF INTELLECTUAL PROPERTY

  • Copyright
  • Nature of Copyright
  • Patent
  • Trade marks
  • Designs
  • Confidential information

REFERENCES: CHAPTER 506 THE TRADE MARKS ACT; THE COPYRIGHT ACT, 2001 No. 12 of 2001; INDUSTRIAL PROPERTY ACT, CAP 509 LOK

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