It is to be observed that the factor or agent must be one

entrusted (flf) with a document of title as cnumci-atcd, or (6)

with possession of the goods for the purpose of sale, or as

security for advances to be made or obtained thereon. Calling

the agent a " trustee " does not prevent the act from operating

if the relation is in fact that of priuci[)al and agent.^ But an

merchandise of which the documentary evidence of title is in the agent's

name. First N. B. v. Shaw, 61 N. Y. 283, 300.

' Under the English Act tlie factor need not be entrusted with the

goods for the purpose of sale, or as security for advances; it is enough

that he is in possession with the consent of the owner. The Xew York

Act expressly provides that, " Nothing contained in this act shall author-

Ize a common carrier, warehouse-keeper, or other y)erson to whom mer-

chandise or other property may be committed for transportation or

storage only, to sell or hypothecate the same." В§ 7. This same result is

reached in the English Act by limiting the Act to " mercantile agents."

2 This is ostensible ownership. The English Act reads, "any sale,

pledge, or otlier disposition . . . shall ... be as valid as if he were expressly

authorized by tlie owner of the goods to make the same.'' This is osten-

sible agency in form.

8 Xew York Security & Trust Co. V. Lipman, 91 Hun, 554, allirmed,

157 N. Y. 551.

LIABILITY OF THIRD PARTY. 221

employee in the owner's store or place of business is not such

an agent, because in such case the possession of the agent is

the possession of the owner, and not such a " possession for

the purpose of sale " as is meant in the act.^ But the posses-

sion of a travelling salesman is possession by the agent within

the meaning of the act.^ Possession of the goods must be

for one of the purposes enumerated in order that the act shall

apply .^ Actual and not merely constructive possession is

necessary in the absence of documentary evidence of title;*

and such possession must have been given voluntarily by the

principal, for if the agent obtains the goods by trespass or

fraud he is not entrusted with thcm.^ If the agent be en-

trusted with a document of title this must be in his name.^

He must have been entrusted with it by the owner ; ^ but en-

trusting a factor with a primary document out of which the

one dealt with grows, is the same as entrusting him with the

latter directly.^ The documents of title to which the act

applies are only the three enumerated.^

It is to be observed that the third party must have made

a contract of sale, pledge, or otherwise, " upon the faith

thereof," that is, upon the faith of the appearance of owner-

ship in the agent. To entitle the third party to the protec-

tion of the statute, it must appear that he believed the factor

to be the true owner.^^ One making advances to a factor

upon goods know^n not to be the goods of the factor cannot

claim an estoppel under this act." But a mere delay between

1 Sage V. Shepard & Morse Lumber Co., 4 N. Y. App. Div. 290, af-

firmed, 158 N. Y. 672.

2 Cairns v. Page, 165 Mass. 552.

3 Moors V. Kidder, 34 Hun, 534, affirmed, 106 N. Y. 32.

* Howland v. Woodruff, 60 N. Y. 73.

5 Kinsey v. Leggett, 71 N. Y. 387; Soltau v. Gerdau, 119 N. Y. 380 •,

Prentice Co. v. Page, 164 Mass. 276.

6 First N. B. v. Shaw, 61 N. Y. 283.

' Bonito ('. Mosquera, 2 Bosw. (N. Y.) 401.

8 Cartwright v. Wilmerding, 24 N. Y. 521.

^ Bonito V. Mosquera, 2 Bosw. (N. Y.) 401; Western Transp, Co. v.

Barber, 50 N. Y. 544.

10 Stevens v. Wilson, 3 Den. 472 ; approved, 6 N. Y. 380.

11 Covell V. Hill, 6 N. Y. 374.

222 PRINCIPAL AND THIRD TARTY.

tlic time of the advance, and the actual transfer of the pledge,

is not fatal, if the advance was made on the faith thereof.^

Tlie effect of the Factors Acts is merely to extend the

general doctrine of estoppel to the correction of an especially

narrow judicial dogma. The courts decided that a factor

could not, without express authority, pledge his principal's

goods, whatever ai)ijearance of authority or of ownership he

might be vested with.^ Some courts have deplored this dog-

matic rule, but have felt bound by it.^ The legislatures have

aided the courts by extending the doctrines of estoppel to this

set of facts.*

В§ 172. Forms of action for property or its value.

Wlien the principal's property has been converted by the

third party, the principal has his choice of several remedies.