Article 7 Sections

Article 7 Sections

7-104(1)

(1) A warehouse receipt . . . is negotiable

(a) if by its terms the goods are delivered to bearer or to the order of a named person;

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7-501

(1) A negotiable document of title running to the order of a named person is negotiated by his indorsement and delivery. After his indorsement in blank or to bearer any person can negotiate it by delivery alone.

(2)

(a) A negotiable document of title is also negotiated by delivery alone when by its original terms it runs to bearer.

(b) When a document running to the order of a named person is delivered to him the effect is the same as if the document had been negotiated.

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(4) A negotiable document of title is "duly negotiated" when it is negotiated in the manner stated in [by delivery with any necessary indorsement] to a holder who purchases it in good faith and without notice of any defense against or claim to it on the part of any person and for value * * *.

7-502(1)

(1) Subject to the following section and to the provisions of Section 7-205 on fungible goods, a holder to whom a negotiable document of title has been duly negotiated acquires thereby:

(a) title to the document;

(b) title to the goods;

(c) all rights accruing under the law of agency or estoppel, including rights to goods delivered to the bailee after the document was issued; and

(d) the direct obligation of the issuer to hold or deliver the goods according to the terms of the document free of any defense or claim by him except those arising under the terms of the document or under this Article. In the case of a delivery order the bailee's obligation accrues only upon acceptance and the obligation acquired by the holder is that the issuer and any indorser will procure the acceptance of the bailee.

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7-503(1)

(1) A document of title confers no rights in goods against a person who before issuance of the document had a legal interest or a perfected security interest in them and who neither

(a) delivered or entrusted [the goods to the bailor or his nominee with actual or apparent authority to store the goods with a bailee who issues a negotiable document of title]; nor

(b) acquiesced in the procurement by the bailor or his nominee of any document of title.