3-06 Factors
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<![CDATA[CHAPTER 3-06FACTORS3-06-01. Definition. A factor is an agent who, in the pursuit of an independent calling, isemployed by another to buy or sell property in the factor's own name and is entrusted by the<br>principal with the possession or control of the property or authorized to receive payment therefor<br>from the purchaser.3-06-02. Authority of factors. In addition to the authority of agents in general, a factorhas actual authority from the factor's principal unless specially restricted:1.To insure property consigned to the factor uninsured.2.To sell property consigned to the factor on such credit as is usual, except such<br>things as it is contrary to usage to sell on credit, but having once agreed with the<br>purchaser upon the terms of credit, a factor may not extend it, nor may the factor<br>pledge, mortgage, or barter the property so consigned.3.To delegate the factor's authority to the factor's partner or servant, but not to any<br>person in an independent employment.3-06-03. Ostensible authority of factor. A factor has ostensible authority to deal withthe property of the factor's principal as the factor's own in transactions with persons not having<br>notice of the actual ownership.3-06-04. Must obey instructions - Exception. A factor must obey instructions of thefactor's principal to the same extent as any other employee, notwithstanding any advances the<br>factor may have made to the principal upon the property consigned to the factor, except that if<br>the principal forbids the factor to sell at the market price, the factor nevertheless may sell for the<br>factor's reimbursement after giving to the factor's principal reasonable notice of the factor's<br>intention to do so and of the time and place of sale, and proceeding in all respects as a pledgee.3-06-05.Liability under guaranty commission.A factor who charges the factor'sprincipal with a guaranty commission upon a sale thereby assumes absolutely to pay the price<br>when it falls due as if it were a debt of the factor's own and not as a mere guarantor for the<br>purchaser, but the factor does not thereby assume any additional responsibility for the safety of<br>the factor's remittance of the proceeds.3-06-06. Relieved of liability by consent only. A factor who receives property for saleunder a general agreement or usage to guarantee the sale or the remittance of the proceeds<br>cannot obtain relief from responsibility therefor without the consent of the factor's principal.Page No. 1Document Outlinechapter 3-06 factors]]>