STOCK SALE CONTRACTS.

Otago Daily Times, Issue 18764, 18 January 1923, Page 6

STOCK SALE CONTRACTS.

It is a remarkable circumstance that the degree of responsibility of commission agents to vendors for the due payment of agreed prices in respect of the sal© of stock and primary products has never been distinctly and definitely determined. The fact that in a country like New Zealand there must bo thousands of transactions of this description every year and that a dispute between the vendor and the agent is a matter of rare occurrence may be accepted as a striking testimony to the honesty and bona fidcs’of all persons concerned. The question of the agent’s responsibility might not have arisen pointedly even now were it not for the fact that the associated stock and station agents and auctioneers have framed a new form of sale contract which it is proposed by them to adopt in the case of every sale of stock through an agent. The terms of this sale note have excited —not without just cause, as it seems to us—a. good deal of concern, amounting to indignation, on the part of stockowners, and a strong protest against them is likely to be made by the farmers’ organisations. On the face of it, the sale is admirably designed to protect the agent at both ends of the contract. It provides that the agent shall not be liable to either vendor or purchaser in the event of a repudiation of a sale or of a failure or refusal to confirm or complete the transaction. In this respect it seeks to secure for him an exceptional immunity from responsibility. Yet in a great many of these transactions the principals, possibly strangers to each other,' rely on tie implied assurance of the agents as to the

honesty and solvency of the clients whom they introduce. Even when it is granted that the agents are firms of the highest standing and that it is at least nob tjp their interest to involve themselves in business of a doubtful nature, it is difficult to see what justification there can bo for their requesting vendors and purchasers of stock to execute a contract that is clearly one-sided. In practice, an agent must assume some responsibility towards his client, and it is not unreasonable to expect that he shall satisfy himself, and accept the onus of satisfying himself, concerning the financial stability and the integrity of a person whom he may introduce as a purchaser of stock. The proposed sale note, however, appears certainly to be Open to the construction that it is directed to protect him against any claim whatever which one of the parties to the contract morally and legitimately has against him in the event of default by the other party. We can hardly believe that the associated agents will not realise that an objection by stockowners and farmers to the execution of a document of this character is well founded.