Scottish Court of Session Decisions

Subject_1 FACTOR.
Subject_2 SECT. III.

Rules of accounting. - Right to salary. - Malversation.

John Rankin, Merchant in Ayr,
v.
Robert Mollison, Collector of Excise there

Date: 17 February 1738
Case No. No 17.

One who contracts factorio nomine, is presumed to bind his constituent only, unless the contrary be expressed; and therefore is not personally liable to implement, but only to furnish a sufficient commission so as to bind his constituent.

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Mr Arbuthnot in Peterhead having wrote to Mollison, with respect to some meal he had to dispose of, Mollison, in consequence thereof, entered into a bargain with Rankin anent the purchase of the meal, and wrote a letter to him, wherein he says, That he had a commission from Mr Arbuthnot to dispose of a certain quantity of meal for his account; and then adds, “And I do agree with you, in his name, that betwixt, &c. he shall provide you 800 bolls good and sufficient oat-meal, &c. to be delivered either at Portsoy or Peterhead, in the option of the said Mr Arbuthnot, who is to have his orders ready at Portsoy, if the ship calls for them.” In consequence of which bargain, Rankin sent a ship for the meal; and, upon its not being delivered, he brought a process against Mollison, founded upon the above letter, for the damage he sustained by the not delivery.

The defence pleaded for Mollison was: That, by the whole tenor of the letter, it was plain, he did not intend to subject himself to any personal demand at the pursuer's instance, as he declares therein, That he acted by commission from Mr Arbuthnot, disposes of the meal for his account, and the place of delivery to be at his option; wherefore, as there are no obligatory words upon the defender through the whole of it, the natural construction must be, that Mollison intended only to bind his constituent, and not himself. See Huber. tit. Exerc. act, § 6. Voet. De Inst. § 6. Sand. Decis. book 3. tit. 7. def. 1. The import of which authorities amounts to this, that the obligation of the party contracting, is to be regulated by the character under which he acts; and that a factor, or person acting by commission, is understood to bind his constituent only, and not himself.

Answered for the pursuer; Though the letter bears the defender had a commission, yet the same was not shown to him at or before the bargain; he relied solely on Mollison, and cannot be supposed to have acted on the faith of a commission not seen, which, now it is produced, is indefinite as to quantity, price, and date. 2do, Supposing the defender had acted procuratorio nomine, yet that could not free him, because, as such, he was bound as well as his constituent, See L. 13. ff. § 25. De act. empt. L. 1. § 17. De exer. act. 3tio, The letter or commission from Mr Arbuthnot to the defender does not give him a power to conclude a bargain with any person, and therefore he cannot give a third party a legal action against his constituent, though, from his commission, the Court may find the defender has an implied relief.

The Lords found the defender was not personally liable, but only to furnish the pursuer with a commission.

Fol. Dic. v. 1. p. 288. C. Home, No 87. p. 141.