The Vermont Statutes Online
The Statutes below include the actions of the 2025 session of the General Assembly.
NOTE: The Vermont Statutes Online is an unofficial copy of the Vermont Statutes Annotated that is provided as a convenience.
(Cite as: 9A V.S.A. § 7-502)
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§ 7—502. Rights acquired by due negotiation
(a) Subject to sections 7—205 and 7—503 of this title, 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 7—503 of this title, 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. (Added 2015, No. 51, § B.3, eff. June 3, 2015.)