—
—
Relations between Principal and Third Persons.
Pakt IX.
205
Sect. 2. Yhere a principal (o) intrusts his agent with the title-deeds of any property, and gives him authority to raise a loan by means of them Goods etc. upon tiie security of the property, he is bound, as regards any intrusted to Agent, person who has dealt with the agent in good faith, by any security given by the agent to the full amount advanced by such person Title deeds, to the agent on the faith of the security, notwithstanding the fact that the agent exceeded his authority in borrowing such amount (jj>). No disposition, however, which depends for its validity upon a Forged instrument. forged instrument, is binding upon the principal (q), _
Sub-Sect.
3.
Disjwsifions under the Factors Act, 1889
437. Where a mercantile agent principal, in the possession
(t)
of
(s)
(r).
with the consent of his
is,
Dispositions
goods or of the documents of ^^^^^
goods belonging to the principal, the principal is bound by any sale, pledge (x), or other disposition of the goods made by the agent (a) for valuable consideration while acting in the ordinary course of business of a. mercantile agent (h), a,s regards any person taking under the disj)osition, provided that such person acts in good faith, and has no notice at the time of the disposition Where the agent that the agent has no authority to make it (c). obtains possession without his principal's consent, no disposition by him is binding on the principal {d). But if the agent has been in possession with his principal's consent, the revocation of the title (u) to
(0) Per the position of a mortgagee who allows the mortgagor to retain or receive the title-deeds of the mortgaged property, see title Mortgage. BrocldeslnjY, TemjJtrance Building Society, _lS9o'] A. G. 173; Eohiusony. Montgomerysltire Brewery Co., [1896] 2 Ch. 841 Gordon v. James (1885), 30 Ch. D. 249 Rimrner v. WeUter, [1902] 2 Ch. 163. See also Lloyd's Bank, Ltd. V. Co(jl:e, [1907] 1 K. B. 794. ((/) .Mayor etc. of Mercliants of the Staple of England y. Bank of England (1887), 21 B. D. 160; Bank of Lr eland v. Trustees of Evans' Charities in Lr eland (1855), Fainter v. Ahil (1863), 2 H._ & 0. 113. 5 H. L. Cas. 389 (r) 52 & 53 Yict. c. 45. The provision of this Act is in amplification and not in derogation of the common law powers of an agent [ibid., s. 13). (s) For the definition of a mercantile agent, see p. 152, ante. (t) The agent is in possession when the goods or documents are in his actual custody or are held by any other person subject to his control, or for him, or on his behalf {ibid., s. 1 (2)). {u) "Documents of title" include any bill of lading, dock warrant, warehouse-keeper's certificate, and warrant or order for the delivery of goods, and any other document used in the ordinary course of business as proof of the possession or control of goods, or authorising or purporting to authorise, either by indorsement or by delivery, the possessor of the document to transfer or receive goods thereby represented {ibid., s. 1 (4)). If the agent obtains possession of any documents of title by reason of being or having been, with the consent of his principal, in possession of goods or other documents of title, his possession of the first-mentioned documents of title is deemed to be with the consent of the principal {ibid., s. 2 (3)). {x) " Pledge " includes any contract pledging, or giving a lien or security on, goods, whether in consideration of an original advance, or of any further or continuing advance, or of any pecuniary liability {ibid., s. 1 (5)). pledge of the documents of title to goods is deemed to be a pledge of the goods {ibid., s. 3). See Waddington & Sons v. Neale & Sons (1907), 23 T. L. E. 464. (tt) Or by his clerk or other person authorised in the ordinary course of business (Factors Act, 1889 (52 & 53 Yict. c. 45), s. 6). But the Act does not protect dispositions by persons who are not mercantile agents within its meaning [Lamb v. Attenborough (1862), 1 B. & S. 831 Wood v. Roiucliffe (1846), 6 Hare, 183 at p. 191). {b) But not when the disposition is outside the ordinary course of business, see Hastings v. Fearson, [1893] 1 Q. B. 62 Waddington & Sons v. N'eale <^ Sons, supra ; and compare Oppenheimer v. Attenborough & Son, [1907] 1 K. B. 510. (c) Factors Act, 1889 (52 & 53 Yict. c. 45), s. 2 (1). {d) Vaughan v. Moffat (1868), 38 L. J. (ch.) 144. So also when possession is
Q
A
Factors
