Civil Code > TITLE XIV. AGENCY 3

Chapter 3. Commission

Section 1. Commission to buy or to sell

Art. 2234 – Definition.

(1) The commission to buy or to sell is a contract of agency whereby the agent, called the commission agent, undertakes to buy or to sell in his own name but on behalf of another person, called the principal, goods, securities or other fungible things.

(2) The rules governing agency shall apply to this contract subject to such special provisions and exceptions as are laid down in this Section.

Art. 2235 – Measures of preservation.

(1) The commission agent shall take all necessary steps for the preservation of the goods sent to him on behalf of the principal and safeguard the latter’s rights against the carrier when the goods seem to have been damaged or their arrival has been delayed.

(2) He shall forthwith notify these incidents to the principal, as well as the fact that the goods have not arrived.

(3) Such duties shall be carried out by a person notwithstanding that he has not accepted the commission, where the commission falls within his professional activity.

Art. 2236 – Sale of goods.

Where there is a risk that the goods consigned for sale will quickly deteriorate, the commission agent may and, where it is in the interest of the principal, shall have them sold with the assistance of the competent authorities at the place of their location.

Art. 2237 – Anticipated payment.

The commission agent shall act at his own risk where, without the principal’s consent. He pays the seller before delivery has taken place.

Art. 2238 – Sale on credit.

(1) The commission agent may grant time for payment to the buyer where such is the custom of trade at the place of sale and the principal has not given him contrary instructions.

(2) The commission agent who grants time for payment shall inform the principal as to the person of the buyer and the period of time granted for payment.

(3) Failing such notification by the commission agent, the transaction shall be deemed to be made on a cash basis and the provisions of the following Article shall apply.

Art. 2239 – Unauthorised Credit.

(1) Where the commission agent grants time for payment contrary to the instructions of the principal or usage, the principal may demand immediate payment.

(2) In such a case, the commission agent may retain the benefits he received in granting time for payment.

Art. 2240 – Guarantee given by commission agent.

(1) The commission agent shall be liable to the principal for the payment or the performance of other obligations by the persons with whom he contracted where he acted as del credere agent.

(2) Unless otherwise agreed, a commission agent entrusted with the purchase or sale of securities shall be deemed to be a del credere agent.

(3) A commission agent entrusted with the purchase or sale of goods shall be deemed to be a del credere agent where such is the custom of trade in the palce where he resides or where he guaranteed the solvency of the persons with whom he contracted.

Art. 2241 – Del credere agent.

(1) The del credere commission agent is a guarantor jointly liable with the person with whom he contracted.

(2) He shall in all cases be liable to the principal for the performance of the contract he entered into unless non-performance was due to the principal’s default.

Art. 2242 – Insurance.

The commission agent shall not be bound to insure the goods unless the principal instructed him to do so.

Art. 2243 – Remuneration of commission agent.

(1) Where the remuneration of the commission agent has not been agreed upon between the parties, it shall be fixed in accordance with the custom of the place where the contract was entered into by the commission agent.

(2) Failing such custom, the court shall fix it on the basis of equity having regard to the work performed by the commission agent, the expenses he incurred and the risks he assumed.

(3) Where he acted as del credere agent, the commission agent shall be entitled to a special remuneration to be fixed under the terms of the contract or in accordance with usage or equity.

Art. 2244 – When remuneration is due.

(1) The commission agent shall be entitled to his remuneration for a specific transaction entrusted to him where the transaction is completed or where failure to complete it is due to a reason attributable to the principal.

(2) He shall not be entitled thereto where the transaction was not completed for other reasons, subject to any contrary usage in the place of his professional activity.

Art. 2245 – Forfeiture of right to remuneration.

(1) The right to remuneration shall be forfeited where the commission agent acts dishonestly towards the principal.

(2) It shall be forfeited in particular where he pretends that he purchased at a higher price or sold at a lower price than he actually did.

Art. 2246 – Outlays and advances.

(1) The commission agent shall be entitled to be reimbursed with interest all outlays and advances made by him in good faith to carry out the transactions entrusted to him by the principal.

(2) Unless otherwise agreed, such reimbursement shall be due to him notwithstanding that the transaction entrusted to him could not be effected.

Art. 2247 – Lien.

(1) The commission agent shall have a lien for the payment of the sums due to him by the principal.

(2) He may exercise this right on all goods in his possession which he was instructed to buy or to sell on behalf of the principal.

(3) He may exercise it on the monies he received from a buyer for the principal.

Art. 2248 – Dealings on own account.

(1) The commission agent entrusted with the sale or purchase of goods quoted on the Stock Exchange or having marker value may, in the absence of contrary instructions by the principal, effect the transaction as a third party on his own account and conclude the contract with himself.

(2) In such a case, he shall remain entitled to the remuneration agreed upon or resulting from usage.

(3) The price fixed for the transaction may not be less than the price intimated to him by the principal nor than the price quoted on the Stock Exchange or the market price.

Art. 2249 – Presumption.

Where the commission agent who is himself entitled to act as buyer or seller notifies the principal of the carrying out of a transaction without naming the person with whom he contracted, he shall be deemed to have assumed the obligations of buyer or seller on his own account.

Art. 2250 – Termination of commission.

The commission shall not terminate where the principal or the commission agent dies, becomes incapable or is declared absent where the heirs or representatives of the principal or commission agent continue his commercial activity.

Section 2. Forwarding agency

Art. 2251 – Forwarding agency.

(1) The forwarding agency is a contract of agency whereby the agent, called the commission agent, shipper or forwarding agent, undertakes to enter in his own name but on behalf of another person, called the principal, into a contract for the forwarding of goods.

(2) The rules governing the contract of commission to buy or to sell shall apply to this contract.

Art. 2252 – Insurance and dealings on own account.

(1) Unless otherwise agreed, the forwarding agent shall not be bound to insure the goods.

(2) He may himself undertake to effect their transport.

(3) In such a case, he shall have the same rights and duties as a carrier.

LawCodes