Iowa Code 554.7502 – Rights acquired by due negotiation
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Terms Used In Iowa Code 554.7502
- Fraud: Intentional deception resulting in injury to another.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- person: means individual, corporation, limited liability company, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, or any other legal entity. See Iowa Code 4.1
554.7502 Rights acquired by due negotiation.
1. Subject to sections 554.7205 and 554.7503, a holder to which 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 the issuer except those arising under the terms of the document or under this Article, but in the case of a delivery order, the bailee’s obligation accrues only upon the bailee’s acceptance of the delivery order and the obligation acquired by the holder is that the issuer and any indorser will procure the acceptance of the bailee.
2. Subject to § 554.7503, title and rights acquired by due negotiation are not defeated by any stoppage of the goods represented by the document of title or by surrender of the goods by the bailee, and are not impaired even if:
a. the due negotiation or any prior due negotiation constituted a breach of duty;
b. any person has been deprived of possession of a negotiable tangible document or control of a negotiable electronic document by misrepresentation, fraud, accident, mistake, duress, loss, theft, or conversion; or
c. a previous sale or other transfer of the goods or document has been made to a third person.
[S13, §3138-a41, -a47, -a48, -a49, -b31, -b37, -b38, -b39, -b41; C24, 27, 31, 35, 39, §8276,
8282 – 8284, 8286, 9701, 9707 – 9709, 9949, 9954, 9962, 9967, 9991; C46, 50, 54, 58, 62,
§487.32, 487.38 – 487.40, 487.42, 542.41, 542.47 – 542.49, 554.21, 554.26, 554.34, 554.39,
554.63; C66, 71, 73, 75, 77, 79, 81, §554.7502]
2007 Acts, ch 30, §30 – 32, 45, 46
1. Subject to sections 554.7205 and 554.7503, a holder to which 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 the issuer except those arising under the terms of the document or under this Article, but in the case of a delivery order, the bailee’s obligation accrues only upon the bailee’s acceptance of the delivery order and the obligation acquired by the holder is that the issuer and any indorser will procure the acceptance of the bailee.
2. Subject to § 554.7503, title and rights acquired by due negotiation are not defeated by any stoppage of the goods represented by the document of title or by surrender of the goods by the bailee, and are not impaired even if:
a. the due negotiation or any prior due negotiation constituted a breach of duty;
b. any person has been deprived of possession of a negotiable tangible document or control of a negotiable electronic document by misrepresentation, fraud, accident, mistake, duress, loss, theft, or conversion; or
c. a previous sale or other transfer of the goods or document has been made to a third person.
[S13, §3138-a41, -a47, -a48, -a49, -b31, -b37, -b38, -b39, -b41; C24, 27, 31, 35, 39, §8276,
8282 – 8284, 8286, 9701, 9707 – 9709, 9949, 9954, 9962, 9967, 9991; C46, 50, 54, 58, 62,
§487.32, 487.38 – 487.40, 487.42, 542.41, 542.47 – 542.49, 554.21, 554.26, 554.34, 554.39,
554.63; C66, 71, 73, 75, 77, 79, 81, §554.7502]
2007 Acts, ch 30, §30 – 32, 45, 46