Robin was a receptionist for Playtime, Inc., a toy manufacturing company. Robin's desk was at the entrance to Playtime, Inc.'s corporate office and her duties were to greet customers, answer telephone calls, sort and distribute mail, and respond to general requests for information about Playtime, Inc. One day, when all of the managers of Playtime, Inc. were out of the office on a corporate retreat, a representative of Prime Insurance Co., Robert, stopped by. Robert told Robin that he wanted to find out whether Playtime might be interested in canceling its present health insurance plan and adopting a new plan provided by Prime. Robin stated that none of Prime's managers was in the office, but Robert continued to describe Prime's plan in detail. Robin commented that Prime’s plan sounded better than the current Playtime plan. Robert immediately produced a contract for Robin to sign. Reluctantly, Robin signed the contract on behalf of Playtime, accepting the offer to adopt Prime’s insurance plan. Playtime's bookkeeper paid three months of premiums to Prime Insurance Co. before realizing that it was a different insurance company. She immediately brought the matter to the attention of Playtime's CEO. The CEO notified Prime Insurance Co. that Robin had no authority to enter into the contract on behalf of Playtime, and that Playtime would not pay further premiums. Prime Insurance Co. sued Playtime for breach of contract, alleging that Playtime was bound to the contract on the grounds that: (1) Robin had actual authority to enter into the contract; (2) Robin had apparent authority to enter into the contract; and (3) Playtime ratified the contract. Is Prime Insurance Co. correct in its claims? 1. BE SURE TO DISCUSS THE ELEMENTS OF EACH OF THE GROUNDS ASSERTED BY PRIME INSURANCE CO. AND THEN ANALYZE WHETHER THE FACTS SATISFY THOSE ELEMENTS. 2. Correctly applies the facts to the legal elements for all three issues. 3. Correctly defines all three legal issues.

Question

Robin was a receptionist for Playtime, Inc., a toy manufacturing company. Robin's desk was at the
entrance to Playtime, Inc.'s corporate office and her duties were to greet customers, answer telephone
calls, sort and distribute mail, and respond to general requests for information about Playtime, Inc. One
day, when all of the managers of Playtime, Inc. were out of the office on a corporate retreat, a
representative of Prime Insurance Co., Robert, stopped by. Robert told Robin that he wanted to find out
whether Playtime might be interested in canceling its present health insurance plan and adopting a new
plan provided by Prime. Robin stated that none of Prime's managers was in the office, but Robert
continued to describe Prime's plan in detail. Robin commented that Prime’s plan sounded better than
the current Playtime plan. Robert immediately produced a contract for Robin to sign. Reluctantly, Robin
signed the contract on behalf of Playtime, accepting the offer to adopt Prime’s insurance plan.
Playtime's bookkeeper paid three months of premiums to Prime Insurance Co. before realizing that it
was a different insurance company. She immediately brought the matter to the attention of Playtime's
CEO. The CEO notified Prime Insurance Co. that Robin had no authority to enter into the contract on
behalf of Playtime, and that Playtime would not pay further premiums.
Prime Insurance Co. sued Playtime for breach of contract, alleging that Playtime was bound to the
contract on the grounds that: (1) Robin had actual authority to enter into the contract; (2) Robin had
apparent authority to enter into the contract; and (3) Playtime ratified the contract.
Is Prime Insurance Co. correct in its claims?
1. BE SURE TO DISCUSS THE ELEMENTS OF EACH OF THE GROUNDS ASSERTED BY PRIME
INSURANCE CO. AND THEN ANALYZE WHETHER THE FACTS SATISFY THOSE ELEMENTS.
2. Correctly applies the facts to the legal elements for all three issues.
3. Correctly defines all three legal issues.