§ IV. On Sale through Brokers

1005. • Sale through brokers is that which is not made immediately by him to whom the thing to be sold pertains; but from his mandate or commission by others, who are called brokers.

Concerning sale and purchase of this kind certain special things occur to be noted a) respectively to brokers in general, and b) respectively to those brokers in particular who are such by office.

1006. I. On brokers in general. - As to brokers in general this one difficulty alone is usually moved:

Whether a broker who sells ABOVE or buys BELOW the price designated to himself by his principal can licitly retain for himself the EXCESS of the designated price?

Resp. Of itself speaking negatively; because a broker, as such, enjoys by himself no just title for retaining something for himself. Yet accidentally, namely on account of particular circumstances, he will be able to have a title of this kind and consequently licitly to retain something for himself, namely:

a) If the broker by his extraordinary and undue labor or by his special industry improved the thing to be sold, and therefore precisely sold it for more; for the fruits of industry follow industry.

b) If the owner of the thing had expressly or equivalently declared that he exacted nothing beyond the price designated from the broker; as they assert happens rather often where the owner assigns no stipend for the labor of the broker.

c) If the broker, common diligence having been carefully applied, and no greater price having been found, truly and validly buys the thing for himself and at his own risk, and afterwards sells it for more, and pays to the owner only the designated price.

d) Finally the broker can licitly retain for himself the residue of the price, given or determined by his principal for buying something, whenever that whole determined price would have had to be expended, unless the seller had diminished the price in favor of the broker himself; and thus, for example, a tailor, deputed to buy in a shop cloth and other things necessary for making garments, and besides faithfully managing the business of the owner, will licitly retain for himself that part of the price which the shopkeeper remitted or donated to the tailor in his favor, for example because he frequents his shop, etc. Yet St. Alphonsus warns that in cases of this kind one must proceed cautiously, lest justice be injured; since, as experience testifies, it not rarely happens that shopkeepers pretend that they are donating something to tailors or other brokers, while in reality the owner, if he himself went to the shop, would obtain the thing for the same diminished price.

1007. II. On brokers by office. - We call brokers by office those who perform the function of an intermediate negotiator, and in the vernacular tongue are commonly named brokers, commission-merchants. Certainly the same obligation which was just described as to the greater or lesser price is incumbent on these intermediate negotiators as on brokers in general; but more special frauds can be committed by them, which it has seemed useful here to recount summarily.

Therefore they commit fraud:

1. When in their accounts they note, or cause to be noted, the price of the thing bought as greater, or of the thing sold as lesser, than it truly was.

2. When they buy a thing at a price greater than it could easily have been had, so that they may procure a greater increase for themselves.

3. When they bring damage to the mandator by buying worse merchandise.

4. When in taxing things, for example a field, a house, they assign to them a price lesser or greater than the just price.

5. When without a just title they exact a wage or increase greater than custom permits.