BAILMENT
This is a contract whereby a party known as bailor delivers goods to another known as bailee with specific instructions that the goods be dealt with in a particular manner or be returned as soon as the purpose for which they were bailed is accomplished.
Bailment includes:
1. Deposit or storage for safe storage
2. Contract of hiring
3. Pledge
4. Contract for work or repair
5. Carriage of goods
It differs from agency in that:
1. The bailee does not represent the bailor
2. Acts of the bailee do not affect the legal position of the bailor
TRUST
This is an equitable relationship whereby a party known as trustee expressly, impliedly or constructively holds property on behalf of another as beneficiary. It is similar to agency in that:
1. Some of the duties of the trustee are similar to those of the agent e.g must act in good faith and avoid conflict of interest.
2. Some of the remedies available to the beneficiary against the trustee are available to the principal against the agent e.g account
However, they differ in that:
1. Whereas most agencies are contractual, trusts are not
2. Whereas the principal‘s action against the agent for fraud is limited by the Statute of Limitation, an action by the beneficiary against the trustee has no time limitation.
Types of agents
1. General Agent: He is an agent engaged to perform a particular task or transaction on behalf of the principal in the ordinary course of his business, trade or profession as an agent.
2. Special Agent: This is an agent whose authority is restricted to the performance of a particular act not being in the ordinary course of his business, trade or profession. Both types derive their authority from the terms of appointment.
Specific Agents:
- Broker: This is a mercantile agent who has neither possession of goods nor documents of title but who is engaged to make bargains or contracts. He is described as a mere negotiator.
- Factor: This is a mercantile agent who is entrusted with possession and sells the goods in his own name.
- Auctioneer: This is a mercantile agent who is licensed by the state to sell goods and other property by public auction. He may or may not be entrusted with possession but is an agent of both parties.
- Del Credere agent: This is a mercantile agent who in return for an extra commission known as commission del credere, guarantees solvency of a 3rd party with whom the principal contracts. He undertakes to indemnify the principal if the 3rd Party fails to pay the amount due on the contract. A del credere agency is a contract of indemnity. The agent may or may not be entitled with possession or documents of title.
- Ship Captain or Master: This is a mercantile agent with powers over a ship and its cargo and in case of necessity becomes an agent of necessity.
