554.2505 Seller’s shipment under reservation.
1. Where the seller has identified goods to the contract by or before shipment:
a. the seller’s procurement of a negotiable bill of lading to the seller’s own order or otherwise reserves in the seller a security interest in the goods. The seller’s procurement of the bill to the order of a financing agency or of the buyer indicates in addition only the seller’s expectation of transferring that interest to the person named.
b. a nonnegotiable bill of lading to the seller or the seller’s nominee reserves possession of the goods as security, but except in a case of conditional delivery (section 554.2507, subsection 2) a nonnegotiable bill of lading naming the buyer as consignee reserves no security interest even though the seller retains possession or control of the bill of lading.
2. When shipment by the seller with reservation of a security interest is in violation of the contract for sale it constitutes an improper contract for transportation under section 554.2504 but impairs neither the rights given to the buyer by shipment and identification of the goods to the contract nor the seller’s powers as a holder of a negotiable document of title.
[C24, 27, 31, 35, 39, §9949; C46, 50, 54, 58, 62, §554.21; C66, 71, 73, 75, 77, 79, 81, §554.2505]
2007 Acts, ch 30, §45, 46, 55, 56; 2008 Acts, ch 1031, §61; 2015 Acts, ch 29, §90
Referred to in §554.1201, 554.2509, 554.9102, 554.9109, 554.9110, 554.9309