Rights of Financing Agency

1. Law
2. Georgia Code
3. Commercial Code
4. Sales
5. Performance
6. Rights of Financing Agency

1. A financing agency by paying or purchasing for value a draft which relates to a shipment of goods acquires to the extent of the payment or purchase and in addition to its own rights under the draft and any document of title securing it any rights of the shipper in the goods including the right to stop delivery and the shipper's right to have the draft honored by the buyer.
2. The right to reimbursement of a financing agency which has in good faith honored or purchased the draft under commitment to or authority from the buyer is not impaired by subsequent discovery of defects with reference to any relevant document which was apparently regular.

(Code 1933, § 109A-2 - 506, enacted by Ga. L. 1962, p. 156, § 1; Ga. L. 2010, p. 481, § 2-9/HB 451.)

The 2010 amendment, effective May 27, 2010, deleted "on its face" following "regular" at the end of subsection (2). See the Editor's notes for applicability.

Editor's notes.

- Ga. L. 2010, p. 481, § 3-1, not codified by the General Assembly, provides that: "This Act applies to a document of title that is issued or a bailment that arises on or after the effective date of this Act. This Act does not apply to a document of title that is issued or a bailment that arises before the effective date of this Act even if the document of title or bailment would be subject to this Act if the document of title had been issued or bailment had arisen on or after the effective date of this Act. This Act does not apply to a right of action that has accrued before the effective date of this Act." This Act became effective May 27, 2010.

Ga. L. 2010, p. 481, § 3-2, not codified by the General Assembly, provides that: "A document of title issued or a bailment that arises before the effective date of this Act and the rights, documents, and interests flowing from that document or bailment are governed by any statute or other rule amended or repealed by this Act as if such amendment or repeal had not occurred and may be terminated, completed, consummated, or enforced under that statute or other rule." This Act became effective May 27, 2010.

RESEARCH REFERENCES

Am. Jur. 2d.

- 68A Am. Jur. 2d, Secured Transactions, § 13.

6 Am. Jur. Pleading and Practice Forms, Commercial Code, §§ 2:370, 2:434.

U.L.A.

- Uniform Commercial Code (U.L.A.) § 2-506.

ALR.

- Repossession by secured seller as affecting his right to recover on note or other obligation given as a down payment, 49 A.L.R.3d 364.

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