Key Concepts Related to Mercantile Agents
1. Fiduciary Duty: Mercantile agents owe a fiduciary duty to their principals, requiring them to act with utmost good faith, loyalty, and diligence in managing the affairs related to the principalâs goods or business.
2. Authority: The extent of a mercantile agentâs authority is determined by the agreement with the principal. The agent must operate within the scope of the authority granted and is typically authorized to perform specific tasks on behalf of the principal.
3. Sale on Credit: Mercantile agents may have the authority to sell goods on credit, but they are responsible for ensuring that the credit terms are in line with the principalâs instructions and industry practices.
4. Possession of Goods: In some cases, mercantile agents may take possession of the principalâs goods. The law provides guidelines on how this possession should be handled, and the agent must exercise due care to prevent any loss or damage to the goods.
Contract of Pledge: Meaning and Important Cases
Contract of Pledge is a formal agreement whereby one party, referred to as the Pawnor, promises particular items or property to another, referred to as the Pawnee, as security for a debt or obligation. Contract of Pledge carries unique legal implications, encompassing enforceability, consequences of default, and legal rights of both parties. The transfer of possession and the right of sale contribute to an enhanced security arrangement, safeguarding the Pawneeâs interests. The Pawnor transfers ownership of the pledged item to the Pawnee under the agreement, with the understanding that the Pawnor keeps ownership and the Pawnee has a security interest.
Geeky Takeaways:
- Contract of Pledge is considered to be a subset of a Contract of Bailment.
- The goods bailed here are kept as security against a debt or a performance of a promise.
- The bailor here is called Pawnor, and the bailee here is called Pawnee.
- Possession of pledged goods is transferred to the Pawnee, distinct from other bailments.
- The Pawnee has the right to sell the pledged goods in case of default by the Pawnor, providing a recourse for debt recovery.
Table of Content
- What is a Contract of Pledge?
- Case Laws under Contract of Pledge
- Who is a Mercantile Agent?
- Key Concepts Related to Mercantile Agents
- Conclusion
- Frequently Asked Questions (FAQs)
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