C.R.S. Section 4-7-502
Rights acquired by due negotiation

(a)

Subject to sections 4-7-205 and 4-7-503, a holder to which a negotiable document of title has been duly negotiated acquires thereby:

(1)

Title to the document;

(2)

Title to the goods;

(3)

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

(4)

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.

(b)

Subject to section 4-7-503, 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:

(1)

The due negotiation or any prior due negotiation constituted a breach of duty;

(2)

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

(3)

A previous sale or other transfer of the goods or document has been made to a third person.

Source: Section 4-7-502 — Rights acquired by due negotiation, https://leg.­colorado.­gov/sites/default/files/images/olls/crs2023-title-04.­pdf (accessed Oct. 20, 2023).

4‑7‑101
Short title 4‑7‑102
Definitions and index of definitions 4‑7‑103
Relation of article to treaty or statute 4‑7‑104
Negotiable and nonnegotiable document of title 4‑7‑105
Reissuance in alternative medium 4‑7‑106
Control of electronic document of title 4‑7‑201
Person that may issue a warehouse receipt - storage under bond 4‑7‑202
Form of warehouse receipt - effect of omission 4‑7‑203
Liability for nonreceipt or misdescription 4‑7‑204
Duty of care - contractual limitation of warehouse’s liability 4‑7‑205
Title under warehouse receipt defeated in certain cases 4‑7‑206
Termination of storage at warehouse’s option 4‑7‑207
Goods must be kept separate - fungible goods 4‑7‑208
Altered warehouse receipts 4‑7‑209
Lien of warehouse 4‑7‑210
Enforcement of warehouse’s lien 4‑7‑301
Liability for nonreceipt or misdescription - “said to contain” - “shipper’s weight, load, and count” - improper handling 4‑7‑302
Through bills of lading and similar documents of title 4‑7‑303
Diversion - reconsignment - change of instructions 4‑7‑304
Tangible bills of lading in a set 4‑7‑305
Destination bills 4‑7‑306
Altered bills of lading 4‑7‑307
Lien of carrier 4‑7‑308
Enforcement of carrier’s lien 4‑7‑309
Duty of care - contractual limitation of carrier’s liability 4‑7‑401
Irregularities in issue of receipt or bill or conduct of issuer 4‑7‑402
Duplicate document of title - overissue 4‑7‑403
Obligation of bailee to deliver - excuse 4‑7‑404
No liability for good-faith delivery pursuant to document of title 4‑7‑501
Form of negotiation and requirements of due negotiation 4‑7‑502
Rights acquired by due negotiation 4‑7‑503
Document of title to goods defeated in certain cases 4‑7‑504
Rights acquired in absence of due negotiation - effect of diversion - stoppage of delivery 4‑7‑505
Indorser not guarantor for other parties 4‑7‑506
Delivery without indorsement - right to compel indorsement 4‑7‑507
Warranties on negotiation or delivery of document of title 4‑7‑508
Warranties of collecting bank as to documents of title 4‑7‑509
Adequate compliance with commercial contract 4‑7‑601
Lost, stolen, or destroyed documents of title 4‑7‑602
Attachment of goods covered by negotiable document of title 4‑7‑603
Conflicting claims - interpleader 4‑7‑701
Effective date 4‑7‑702
Applicability 4‑7‑703
Saving clause
Green check means up to date. Up to date

Current through Fall 2024

§ 4-7-502’s source at colorado​.gov