47-2401

47-2401. Passing of title; reservation for
security; limited application of this section

Each provision of this chapter with regard to the rights, obligations and remedies
of the seller, the buyer, purchasers or other third parties applies irrespective of title
to the goods except where the provision refers to such title. Insofar as situations are
not covered by the other provisions of this chapter and matters concerning title become
material the following rules apply:

1. Title to goods cannot pass under a contract for sale prior to their
identification to the contract (section 47-2501), and unless otherwise explicitly agreed
the buyer acquires by their identification a special property as limited by this
title. Any retention or reservation by the seller of the title (property) in goods
shipped or delivered to the buyer is limited in effect to a reservation of a security
interest. Subject to these provisions and to the provisions of the chapter on secured
transactions (chapter 9 of this title), title to goods passes from the seller to the
buyer in any manner and on any conditions explicitly agreed on by the parties.

2. Unless otherwise explicitly agreed title passes to the buyer at the time and
place at which the seller completes his performance with reference to the physical
delivery of the goods, despite any reservation of a security interest and even though a
document of title is to be delivered at a different time or place; and in particular and
despite any reservation of a security interest by the bill of lading:

(a) If the contract requires or authorizes the seller to send the goods to the
buyer but does not require him to deliver them at destination, title passes to the buyer
at the time and place of shipment; but

(b) If the contract requires delivery at destination, title passes on tender there.

3. Unless otherwise explicitly agreed where delivery is to be made without moving
the goods:

(a) If the seller is to deliver a tangible document of title, title passes at the
time when and the place where he delivers such documents and if the seller is to deliver
an electronic document of title, title passes when the seller delivers the document; or

(b) If the goods are at the time of contracting already identified and no documents
of title are to be delivered, title passes at the time and place of contracting.

4. A rejection or other refusal by the buyer to receive or retain the goods,
whether or not justified, or a justified revocation of acceptance revests title to the
goods in the seller. Such revesting occurs by operation of law and is not a "sale".