Sup. Ct. Rep. 161; Collier on Bankruptcy, 12th Ed., pp. 1069 and 1149. Spain v. Talcott, 165 App. Div. 815, 152 N. Y. Supp.
hereinafter referred to as the Factor, and..................
hereinafter referred to as the Principal, and................
Whereas the Factor is willing to act as factor for the Principal, provided the business conducted by the Principal is conducted under the terms and conditions hereinafter set forth, and is willing generally to assist in the conduct and management of said business; and
Whereas the Principal is to conduct a general........business................taking goods on consignment.........
and selling said consigned goods; and
Whereas each and every one of the managers are to conduct the business of the Principal,-
Now, in consideration of the mutual covenants herein contained, it is agreed:-
1. The Principal hereby constitutes and appoints the Factor its sole factor.
2. The Principal agrees that it shall deliver and consign to the Factor all goods and merchandise purchased by the Principal or consigned to it for sale. All said goods and merchandise shall be and become the property of the Factor to secure all present and future advances, charges and commissions, and the Factor shall have title thereto, until actual delivery to customers on sales approved by the Factor, and shall have and maintain upon all such merchandise and goods and the accounts receivable growing out of the sale thereof, or the proceeds thereof, a general lien to secure its advances, charges and commissions.
3. The said goods and merchandise shall be in the possession and custody of a representative of the Factor located in said premises, and said custody and possession shall be solely on behalf of the Factor, and no goods or merchandise shall be removed without the express consent of the Factor, and the Factor shall appoint a representative who shall be authorized and empowered and shall deliver merchandise to customers at such prices as the Principal may sell them, when sales are made in accordance with this contract.
4. The Factor shall have no responsibility for the prices obtained for goods and merchandise and shall be required only to account for the merchandise upon the basis of the prices obtained by the Principal.
5. The Factor, when it shall have approved in writing the credit of purchasers, terms and conditions of sale, shall assume all credit risks and responsibility attached thereto in accordance with the terms of this agreement, that is, - the Factor guarantees the solvency of and payment by such customers for goods purchased by such customers and accepted by them, but if such customers refuse or fail to pay on the ground that deliveries are not in accordance with contract, no responsibility shall be assumed by the Factor, and the Factor shall be entitled to charge the account of the Principal with the amount of said account, without any liability under this guarantee.
6. All expenses incurred in connection with the business of the Principal shall be chargeable to and be borne and be paid by the Principal, except that the expense of supervising and determining credits and the collection of accounts shall be borne and paid by the Factor. All insurance upon said goods shall be in the name of the Factor and in companies approved by it, the Factor, the solvency of which companies, however, it shall in no way be responsible for and the premiums may be paid by the Factor and charged to the Principal, or shall be paid by the Principal direct.
7. Immediately upon the sale of any merchandise by the Principal, the account receivable therefor shall become the property of the Factor and all such Recounts receivable are hereby assigned and transferred to the Factor. All such merchandise shall be billed and invoiced upon forms of bill or invoice, satisfactory to the Factor, and unless otherwise demanded by it, the said bills and invoices shall read, - "Bought of................," and shall bear the words "This bill is assigned and payable to................signed,............
and the said signature of the Principal on said invoice or bill, whether printed, stamped or written, shall be deemed a valid and binding signature of the Principal, and the said endorsement thereof to the Factor, in addition to the assignment shall operate as a valid assignment of said account contained in this agreement. The Principal will also execute any form of further assignment which the Factor may request. With the express consent of the Factor in any particular case, the Principal may sell and deliver merchandise direct from........to customers approved by the Factor, in accordance with paragraph "5" hereof, but in every such event the Principal will forward bills and invoices as aforementioned; and it is agreed that all accounts with said customers come within the terms of the within agreements and are assigned to the Factor by virtue of this instrument.
8. The Principal agrees, at all times to keep, save, hold, defend and indemnify the Factor against all actions, proceedings, claims, demands, losses, outlays, damage or expenses, including legal fees, which the Factor may in any wise incur in defending or prosecuting, settling or discontinuing any proceedings or actions or claims in consequence of or arising in any way out of merchandise losses or claims whether for breach of contract, failure to deliver merchandise, rejection of merchandise for any reason whatsoever, damage, destruction or loss of merchandise, partially or totally, breach of warranty, express or implied, or claim arising out of purchases, sales, transportation, collections on insurance, care or custody of said merchandise bought by the Principal from the time that the said merchandise was ordered until the same is finally paid for by a purchaser approved under the terms of this contract. The Principal agrees to indemnify and hold harmless the Factor from any loss or liability resulting from any acts or omissions of the Principal or of its employees in connection with the said goods, or the sales thereof, and the Principal agrees that the Factor shall in no way be liable for any injury, damage to or loss of any goods or merchandise in its possession, whatsoever may be the cause of such injury, damage or loss.