(a) A bailee shall deliver the goods to a person entitled under a document of title if the person complies with subdivisions (b) and (c), unless and to the extent that the bailee establishes any of the following:

(1) delivery of the goods to a person whose receipt was rightful as against the claimant;

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Terms Used In California Commercial Code 7403

  • Bailee: means a person that by a warehouse receipt, bill of lading, or other document of title acknowledges possession of goods and contracts to deliver them. See California Commercial Code 7102
  • Document of title: includes a bill of lading, dock warrant, dock receipt, warehouse receipt, or order for the delivery of goods, and also any other document which in the regular course of business or financing is treated as adequately evidencing that the person in possession of it is entitled to receive, hold, and dispose of the document and the goods it covers. See California Commercial Code 1201
  • Goods: means all things that are treated as movable for the purposes of a contract for storage or transportation. See California Commercial Code 7102
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. See California Commercial Code 1201
  • Right: includes remedy. See California Commercial Code 1201
  • Warehouse: means a person engaged in the business of storing goods for hire. See California Commercial Code 7102

(2) damage to or delay, loss, or destruction of the goods for which the bailee is not liable;

(3) previous sale or other disposition of the goods in lawful enforcement of a lien or on a warehouse‘s lawful termination of storage;

(4) the exercise by a seller of its right to stop delivery pursuant to Section 2705 or by a lessor of its right to stop delivery pursuant to Section 10526;

(5) a diversion, reconsignment, or other disposition pursuant to Section 7303;

(6) release, satisfaction, or any other personal defense against the claimant; or

(7) any other lawful excuse.

(b) A person claiming goods covered by a document of title shall satisfy the bailee’s lien if the bailee so requests or if the bailee is prohibited by law from delivering the goods until the charges are paid.

(c) Unless a person claiming the goods is a person against which the document of title does not confer a right under subdivision (a) of Section 7503:

(1) the person claiming under a document shall surrender possession or control of any outstanding negotiable document covering the goods for cancellation or indication of partial deliveries; and

(2) the bailee shall cancel the document or conspicuously indicate in the document the partial delivery or the bailee is liable to any person to which the document is duly negotiated.

(Repealed and added by Stats. 2006, Ch. 254, Sec. 49. Effective January 1, 2007.)

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