Explanation of word of consignment

 

 

Explanation of word of consignment

Consign

Send / Give over to another for care or safekeeping.

 Consignment 

The delivery of goods for sale or disposal.

Consignor

The person sending the goods is called the "Consignor"

Consignee

The person receiving the goods and selling them is called the "Consignee"

Consignor has ownership and risk in the goods

The ownership and thereby risk in the total stock is with the Consignor. The consignee holds the goods on behalf of the consignor. The consignor is responsible for the acts of the consignee in his status as an agent.

Consignee is the Agent

The consignee acts as the agent of the consignor only. The Consignee sells goods on behalf of the consignor and receives commission for his efforts. Any incidental expenses on the sale are to be reimbursed by the consignor or as agreed between them.

Relationship between Consignor and Consignee is Principal - Agent relationship 
The Consignee acts in the status of an agent to the consignor, i.e. the relationship between the "Consignor" and the "Consignee" is that of "Principal and Agent". The transactions between them are governed by the agreement made between them as well as by the provisions of "The Law of Agency".