QUESTION 3 - [10 MARKS]

Constantine is employed by Dirt Enterprises Ltd as a junior clerk in the mail room. He is sacked because of his inefficiency. On his last day with the company, Constantine, using the appropriate order form, orders ten million gizmos at a cost of $100,000 from Fixit Pty Ltd, a company which has a long connection with Dirt Enterprises. This item is old-fashioned technology, and Dirt has not used them for five years. When the gizmos are delivered, Dirt refuses to accept them, and refuses to pay. Dirt tells Fixit that Constantine had no authority to place the order.

Advise Dirt Enterprises on the liability for the actions of an agent.