Page:United States Statutes at Large Volume 76A.djvu/262

–166– -166§ 1818. Warranties on sale of receipt A person who for value negotiates or transfers a receipt by indorsement or delivery, including one who assigns for value a claim secured by a receipt, unless a contrary intention appears, warrants: (1) that the receipt is genuine; (2) that he has a legal right to negotiate or transfer it; .. (3) that he has knowledge of no fact which would impair the validity or worth of the receipt; and (4) that he has a right to transfer the title to the goods, and that the goods are merchantable or fit for a particular purpose ' whenever such warranties would have been implied, if the contract of the parties had been to transfer without a receipt the goods represented thereby. § 1819. Indorser not a guarantor The indorsement of a receipt does not make the indorser liable for any failure on the part of the warehouseman or previous indorsers of the receipt to fulfill their respective obligations. § 1820. Warranty not implied from accepting payment of a debt A mortgagee, pledgee, or holder for security of a receipt who in good faith demands or receives payment of the debt for which the receipt is security, whether from a party to a draft drawn for such debt or from any other person, is not by so doing deemed to represent or to warrant the genuineness of the receipt or the quantity or quality of the goods therein described. § 1821. When negotiation not impaired by fraud, mistake, or duress The validity of the negotiation of a receipt is not impaired by the fact that the negotiation was a breach of duty on the part of the person making the negotiation, or by the fact that the owner of the receipt was deprived of the possession of the same by loss, theft, fraud, accident, mistake, duress, or conversion, if the person to whom the receipt was negotiated, or a person to whom the receipt was subsequently negotiated, paid value therefor, in good faith, without notice of the breach of duty, or loss, theft, fraud, accident, mistake, duress, or conversion. § 1822. Subsequent negotiation If a person having sold, mortgaged, or pledged goods which are in a warehouse and for which a negotiable receipt has been issued, or having sold, mortgaged, or pledged the negotiable receipt representing the goods, continues in possession of the negotiable receipt, the subsequent negotiation thereof by that person under a sale, or other disposition thereof to a person receiving the same in good faith, for value and without notice of the previous sale, mortgage, or pledge, has the same effect as if the first purchaser of the goods or receipt had expressly authorized the subsequent negotiation. § 1823. Negotiation defeats vendor's lien If a negotiable receipt has been issued for goods, a seller's lien or right of stoppage in transitu does not defeat the rights of a purchaser for value in good faith to whom the receipt has been negotiated, whether the negotiation is prior or subsequent to the notification to the warehouseman who issued the receipt of the seller's claim to a lien or right of stoppage in transitu. Nor is the warehouseman obliged to deliver or justified in delivering the goods to an unpaid seller unless the receipt is first surrendered for cancellation.

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