Legal Definitions - mercantile agent

A mercantile agent is a person who, in the usual course of their business, has the authority to act on behalf of another person (known as the "principal") concerning goods. This authority typically includes selling goods, consigning goods for sale, buying goods, or raising money by pledging goods. The defining characteristic is that they operate within a commercial context, dealing with the principal's goods as part of their professional trade.

Here are some examples to illustrate this concept:

• Example 1: An Art Gallery Owner

  An artist creates several paintings and wants to sell them to collectors. Instead of managing sales themselves, they enter into an agreement with an art gallery owner. The gallery owner displays the paintings and, in the ordinary course of their business, sells them to buyers, taking a commission from the sale price. In this scenario, the art gallery owner acts as a mercantile agent for the artist, as they are authorized to sell the artist's goods (the paintings) on their behalf as part of their commercial activity.

• Example 2: A Consignment Furniture Store

  A homeowner wishes to sell a collection of antique furniture but does not want the hassle of listing items online or dealing with individual buyers. They take the furniture to a local consignment store specializing in antiques. The store owner accepts the furniture, displays it in their showroom, and is authorized to sell it to customers. Once sold, the store owner remits a portion of the sale price to the original homeowner. Here, the consignment store owner is acting as a mercantile agent, as they are entrusted with the homeowner's goods for the purpose of sale in their commercial business.

• Example 3: An Agricultural Broker

  A large-scale farmer has harvested a significant quantity of soybeans and needs to sell them to a processing plant or distributor. To ensure they get the best market price and handle the logistics efficiently, the farmer engages an agricultural broker. The broker, as part of their professional trade, negotiates with various buyers on the farmer's behalf, arranges the sale, and coordinates delivery. The broker is a mercantile agent because they are authorized to sell the farmer's goods (the soybeans) in a commercial capacity.