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The installer's truck, which had been parked in front of the homeowner's house during the roof installation, bore the manufacturer's logo. The manufacturer was aware that the truck and the literature supplied by the installer both displayed the manufacturer's logo.
A homeowner was injured when he slipped and fell in a puddle of water on his sunroom floor; the water had accumulated on the floor during a rainstorm because of leaks in the roof. The roof's manufacturer had supplied nondefective materials to the installer, who was a franchisee (and not an employee) of the manufacturer. The leaks resulted from the carelessness of the installer during the installation of the roof.
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D is correct. Here, this test is potentially met because the manufacturer supplied materials to the installer, the installer's truck bore the manufacturer's logo, and the literature supplied to the plaintiff also bore manufacturer's logo, all of which the manufacturer knew. Thus, there is a potential basis for vicarious liability under the apparent agency doctrine.
A is incorrect. Franchisors are not under a duty to supervise a franchisee in all situations. However, this answer choice overlooks that, even without a franchisor-franchisee duty to supervise, a third party (such as a franchisor) can be liable under the doctrine of apparent agency to a plaintiff injured by the franchisee's negligence.
B is incorrect. One way that a manufacturer can be liable to a consumer is if the product was defective when it left the manufacturer's hands, the product subsequently caused harm to the plaintiff as a result of that defect, and the harm was caused when the product was being used in an intended way or in a way that was reasonably foreseeable. Liability of that sort is called strict product liability. However, manufacturers can be liable for defective products other ways as well, including negligence, breach of warranty situations, and vicarious liability claims such as under the doctrine of apparent authority. This answer choice ignores those other ways and thus oversimplifies the potential bases for the manufacturer's injuries.
C is incorrect. Franchisors are normally not vicariously liable for the actions of their franchisees such as the installer here. That principle is in line with the general rule that employers are generally not liable for the negligence of their independent contractors. However, as described above, the manufacturer could still be vicariously liable under the doctrine of apparent authority.