BUSINESS ADMINISTRATION
BUSINESS LAW
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Non owner
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Real owner
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Pledge
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Pledgor
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Detailed explanation-1: -This pledge is as valid as if the owner of the goods expressly authorizes him to do so. But, this pledge is valid only when the Pawnee acts in good faith and at the time of pledge is unaware of the fact that the mercantile agent did not have the authority to pledge.
Detailed explanation-2: -Pledge by mercantile agent: A mercantile agent is the person who in the customary course of business has an agent’s authority either to sell or consign the goods for the purpose of sale or to buy goods or to raise money on the security of goods 6 . It is basically a person who is given the power of authority of goods.
Detailed explanation-3: -However, even non-owner can create a valid pledge.
Detailed explanation-4: -A pledge is a bailment that conveys possessory title to property owned by a debtor (the pledgor) to a creditor (the pledgee) to secure repayment for some debt or obligation and to the mutual benefit of both parties.