Factors Ordinance


Published: 1997-06-30

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Cap 48 - FACTORS ORDINANCE 1

Chapter: 48 FACTORS ORDINANCE Gazette Number Version Date

Long title 30/06/1997


To consolidate and amend the law relating to factors.
[cf. 1889 c. 45 U.K.]


[1 July 1896]


(Originally 6 of 1896 (Cap 48, 1950))

Section: 1 Short title 30/06/1997


PRELIMINARY


This Ordinance may be cited as the Factors Ordinance.
(Amended 5 of 1924 s. 6)


Section: 2 Interpretation 30/06/1997


(1) In this Ordinance, unless the context otherwise requires-
"document of title" (所有權文件) includes any bill of lading, dock warrant, warehouse keeper's certificate, and

warrant or order for the delivery of goods, and any other document used in the ordinary course of business as
proof of the possession or control of goods, or authorizing or purporting to authorize, either by indorsement or
by delivery, the possessor of the document to transfer or receive goods thereby represented;

"goods" (貨品) includes wares and merchandise;
"mercantile agent" (商業代理人) means a mercantile agent having, in the customary course of his business as such

agent, authority either to sell goods, or to consign goods for the purpose of sale, or to buy goods, or to raise
money on the security of goods;

"person" (人) includes any body of persons corporate or unincorporate;
"pledge" (質押) includes any contract pledging, or giving a lien or security on goods, whether in consideration of an

original advance, or of any further or continuing advance, or of any pecuniary liability.
(2) For the purposes of this Ordinance, a person shall be deemed to be in possession of goods or of the

documents of title to goods, where the goods or documents are in his actual custody or are held by any other person
subject to his control, or for him, or on his behalf.

Section: 3 Powers of mercantile agent with respect to disposition of

goods
30/06/1997



DISPOSITIONS BY MERCANTILE AGENTS


(1) Where a mercantile agent is, with the consent of the owner, in possession of goods or of the documents of
title to goods, any sale, pledge, or other disposition of the goods, made by him when acting in the ordinary course of
business of a mercantile agent, shall, subject to the provisions of this Ordinance, be as valid as if he were expressly
authorized by the owner of the goods to make the same:

Provided that the person taking under the disposition acts in good faith, and has not, at the time of the
disposition, notice that the person making the disposition has not authority to make the same.

(2) Where a mercantile agent has, with the consent of the owner, been in possession of goods or of the
documents of title to goods, any sale, pledge, or other disposition, which would have been valid if the consent had
continued, shall be valid notwithstanding the determination of the consent:

Provided that the person taking under the disposition has not, at the time thereof, notice that the consent has been
determined.

(3) Where a mercantile agent has obtained possession of any documents of title to goods by reason of his being



Cap 48 - FACTORS ORDINANCE 2

or having been, with the consent of the owner, in possession of the goods represented thereby, or of any other
documents of title to the goods, his possession of the first-mentioned documents shall, for the purposes of this
Ordinance, be deemed to be with the consent of the owner.

(4) For the purposes of this Ordinance, the consent of the owner shall be presumed in the absence of evidence
to the contrary.

Section: 4 Pledge of documents of title 30/06/1997


A pledge of the documents of title to goods shall be deemed to be a pledge of the goods.

Section: 5 Pledge for antecedent debt 30/06/1997


Where a mercantile agent pledges goods as security for a debt or liability due from the pledgor to the pledgee
before the time of the pledge, the pledgee shall acquire no further right to the goods than could have been enforced by
the pledgor at the time of the pledge.

Section: 6 Rights acquired by exchange of goods or documents 30/06/1997


The consideration necessary for the validity of a sale, pledge, or other disposition of goods, in pursuance of this
Ordinance, may be either a payment in cash, or the delivery or transfer of other goods, or of a document of title to
goods, or of a negotiable security, or any other valuable consideration; but where goods are pledged by a mercantile
agent in consideration of the delivery or transfer of other goods, or of a document of title to goods, or of a negotiable
security, the pledgee shall acquire no right or interest in the goods so pledged in excess of the value of the goods,
document, or security when so delivered or transferred in exchange.

Section: 7 Agreement through clerk, etc. 30/06/1997


For the purposes of this Ordinance, an agreement made with a mercantile agent through a clerk or other person
authorized in the ordinary course of business to make contracts of sale or pledge on his behalf shall be deemed to be
an agreement with the agent.

Section: 8 Provisions as to consignor and consignee 30/06/1997


(1) Where the owner of goods has given possession of the goods to another person for the purpose of
consignment or sale, or has shipped the goods in the name of another person, and the consignee of the goods has not
had notice that such person is not the owner of the goods, the consignee shall, in respect of advances made to or for
the use of such person, have the same lien on the goods as if such person were the owner of the goods, and may
transfer any such lien to another person.

(2) Nothing in this section shall limit or affect the validity of any sale, pledge, or disposition by a mercantile
agent.

Section: 9 Disposition by seller remaining in possession 30/06/1997


DISPOSITIONS BY SELLERS AND BUYERS OF GOODS


Where a person, having sold goods, continues, or is, in possession of the goods or of the documents of title to the
goods, the delivery or transfer by that person, or by a mercantile agent acting for him, of the goods or documents of
title under any sale, pledge, or other disposition thereof, or under any agreement for sale, pledge, or other disposition
thereof, to any person receiving the same in good faith and without notice of the previous sale, shall have the same
effect as if the person making the delivery or transfer were expressly authorized by the owner of the goods to make the
same.




Cap 48 - FACTORS ORDINANCE 3

Section: 10 Disposition by buyer obtaining possession 30/06/1997


Where a person, having bought or agreed to buy goods, obtains, with the consent of the seller, possession of the
goods or the documents of title to the goods, the delivery or transfer, by that person or by a mercantile agent acting for
him, of the goods or documents of title, under any sale, pledge, or other disposition thereof, or under any agreement
for sale, pledge, or other disposition thereof, to any person receiving the same in good faith and without notice of any
lien or other right of the original seller in respect of the goods, shall have the same effect as if the person making the
delivery or transfer were a mercantile agent in possession of the goods or documents of title with the consent of the
owner.

Section: 11 Effect of transfer of document of title on vendor's lien or

right of stoppage in transitu
30/06/1997



Where a document of title to goods has been lawfully transferred to a person as a buyer or owner of the goods,
and that person transfers the document to a person who takes the document in good faith and for valuable
consideration, the last-mentioned transfer shall have the same effect for defeating any vendor's lien or right of
stoppage in transitu as the transfer of a bill of lading has for defeating the right of stoppage in transitu.

Section: 12 Mode of transferring document 30/06/1997


SUPPLEMENTARY


For the purposes of this Ordinance, the transfer of a document may be by indorsement, or, where the document
is by custom or by its express terms transferable by delivery or makes the goods deliverable to the bearer, then by
delivery.

Section: 13 Saving for rights of true owner 30/06/1997


(1) Nothing in this Ordinance shall authorize an agent to exceed or depart from his authority as between
himself and his principal, or exempt him from any liability, civil or criminal, for so doing.

(2) Nothing in this Ordinance shall prevent the owner of goods from recovering the goods from an agent or his
trustee in bankruptcy at any time before the sale or pledge thereof, or shall prevent the owner of goods pledged by an
agent from having the right to redeem the goods at any time before the sale thereof, on satisfying the claim for which
the goods were pledged, and paying to the agent, if by him required, any money in respect of which the agent would
by law be entitled to retain the goods, or the documents of title thereto, or any of them, by way of lien as against the
owner, or from recovering from any person with whom the goods have been pledged any balance of money remaining
in his hands as the produce of the sale of the goods after deducting the amount of his lien.

(3) Nothing in this Ordinance shall prevent the owner of goods sold by an agent from recovering from the
buyer the price agreed to be paid for the same, or any part of that price, subject to any right of set-off on the part of the
buyer against the agent.

Section: 14 Saving of common law powers of agent 30/06/1997


The provisions of this Ordinance shall be construed in amplification and not in derogation of the powers
exercisable by an agent independently of this Ordinance.

(Note.-The following Acts in their application to the Colony were repealed by this Ordinance-
1823 cap 83;
1825 cap 94;
1842 cap 39.)

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