FACTOR, in its most general sense, is the term applied to any one who is employed to do business for another. Factory differs from the mandate of the Roman law in not being gratuitous. In mercantile transactions, the sale of goods is generally effected either by factors or brokers, both of whom are agents, remunerated generally by a com mission. But the powers of factors are higher than those of brokers, inasmuch as the former arc intrusted with the possession of the goods, and authorized to sell them as if they were their own; whereas the latter have no possession or apparent ownership, but act not only really but ostensibly as agents. Factors frequently act on the principle of the del credere commission (q.v.), receiving, that is to say, a higher remuneration in con sideration of undertaking to guarantee the solvency of the purchasers. At common law, a sale or other transaction by a F. was bad, if it was not fully warranted by the nature of the authority which he derived from his principal; but this doctrine has been modified by several statutes which have been passed for the protection of strangers dealing with persons intrusted with the possession of goods, the extent of whose authority they had no means of ascertaining. By 6 Geo. IV. c. 94, called the factors' act, it was provided that any person in possession of a bill of lading is to be deemed the true owner of the goods therein described, so far as to give validity to any contract or agreement made with him regarding them. 7 and 8 Geo. IV. enacts that if any F. shall, for his own benefit, and in violation of good faith, deposit or pledge any goods, or order for their delivery, he shall be guilty of a misdemeanor. In 1842, the powers of 6 Geo. IV. c. 94, were defined and extended by 5 and 6 Viet. c. 39, which enacted that bond fide advances to persons intrusted with the possession of goods or documents of title, though known to be agents, should be protected; bond fide deposits in exchange were also protected, but it was provided that there should be no lien beyond •the value of the goods given up. The agent's responsibility to his principal is not
diminished, but it is provided that if he shall make consignments contrary to the instruc tions of his principal, lie shall be guilty of a misdemeanor.
In Scotland, the term factor is applied to an agent managing heritable estates for another, letting farms, drawing rents, and the like, in which sense it is nearly synony mous with the English steward, a term which, in Scotland, again, is employed to denote an agent whose powers arc of a far more limited kind than those of a F., and who generally acts under him. If a F. pay money into a bank on his own account, he takes the risk of the bank's failure. A F. cannot delegate his powers, but he may employ a third party to aid him in their discharge. He binds his principal to any engagement which he contracts within his powers. Factory may be recalled, and falls by the death of the principal; but actions already begun may go on, and those done in ignorance of the revocation or death are binding. Revocation is implied in the appoint went of a new agent to do the same act. The mandate of factory subsists notwith standing the supervening insanity of the mandant. Factors may be empowered to grant leases and pursue retnovings, but for these acts special powers are required. Writers to the signet in Edinburgh, and writers in country towns, frequently act as. factors for the neighboring landed proprietors. In 1877, an act was passed to remove doubts and amend the previous factors acts (1823-77). See AGENT; JUDICIAL FACTOR.