§490:2-505  Seller's shipment under
reservation.  (1)  Where the seller has identified goods to the contract by
or before shipment:



(a) The seller's procurement of a negotiable bill of
lading to the seller's own order or otherwise reserves in the seller a security
interest in the goods.  The seller's procurement of the bill to the order of a
financing agency or of the buyer indicates in addition only the seller's
expectation of transferring that interest to the person named.



(b) A nonnegotiable bill of lading to the seller or
the seller's nominee reserves possession of the goods as security but except in
a case of conditional delivery (subsection (2) of section 490:2-507) a
nonnegotiable bill of lading naming the buyer as consignee reserves no security
interest even though the seller retains possession or control of the bill of
lading.



(2)  When shipment by the seller with
reservation of a security interest is in violation of the contract for sale it
constitutes an improper contract for transportation within the preceding
section but impairs neither the rights given to the buyer by shipment and
identification of the goods to the contract nor the seller's powers as a holder
of a negotiable document of title. [L 1965, c 208, §2-505; HRS §490:2-505; am L
2004, c 163, §10]