Okla. Stat. tit. 12A § 7-501

Current through Laws 2024, c. 453.

Section 7-501 - Form of negotiation and requirements of due negotiation

(a) The following rules apply to a negotiable tangible document of title:

(1) If the document's original terms run to the order of a named person, the document is negotiated by the named person's endorsement and delivery. After the named person's endorsement in blank or to bearer, any person may negotiate the document by delivery alone.

(2) If the document's original terms run to bearer, it is negotiated by delivery alone.

(3) If the document's original terms run to the order of a named person and it is delivered to the named person, the effect is the same as if the document had been negotiated.

(4) Negotiation of the document after it has been endorsed to a named person requires endorsement by the named person and delivery.

(5) A document is duly negotiated if it is negotiated in the manner stated in this subsection to a holder that purchases it in good faith, without notice of any defense against or claim to it on the part of any person, and for value, unless it is established that the negotiation is not in the regular course of business or financing or involves receiving the document in settlement or payment of a money obligation.

(b) The following rules apply to a negotiable electronic document of title:

(1) If the document's original terms run to the order of a named person or to bearer, the document is negotiated by delivery of the document to another person. Endorsement by the named person is not required to negotiate the document.

(2) If the document's original terms run to the order of a named person and the named person has control of the document, the effect is the same as if the document had been negotiated.

(3) A document is duly negotiated if it is negotiated in the manner stated in this subsection to a holder that purchases it in good faith, without notice of any defense against or claim to it on the part of any person, and for value, unless it is established that the negotiation is not in the regular course of business or financing or involves taking delivery of the document in settlement or payment of a monetary obligation.

(c) Endorsement of a nonnegotiable document of title neither makes it negotiable nor adds to the transferee's rights.

(d) The naming in a negotiable bill of lading of a person to be notified of the arrival of the goods does not limit the negotiability of the bill nor constitute notice to a purchaser of the bill of any interest of that person in the goods.

Okla. Stat. tit. 12A, § 7-501

Laws 1961, p. 148, § 7-501; Amended by Laws 2005 , HB 2035, c. 140, § 28, eff. 1/1/2006.

Oklahoma Code Comment

Prior Statutory Provisions:

2 O.S. §§ 9-96 to 9- 99, 9-106.

13 O.S. § 93.

Text and derivation of prior provisions, see Appendix at end of this title.

Comment:

(1) Substantially the same as former 2 O.S. § 9-97 and 13 O.S. § 93.

(2) (a) Similar to former 2 O.S. § 9-97 and former 13 O.S. § 93.

(b) This is new. Often a person not the shipper, and very often a bank, is named. Under this section delivery to that person is a negotiation. By this means that person may, according to the subsequent sections, obtain greater rights than the shipper had.

(3) Similar to former 2 O.S. § 9-97. There is no previous comparable Oklahoma section on bills of lading.

(4) New. This introduces a new concept that the transfer must be in regular course of business or financing to be a "due negotiation." Thus, the transfer of a bill of lading by one not usually engaged in that business, or in goods of the kind covered by the bill, is not a "due negotiation" and the transferee is not protected by the rules which favor a "holder."

(5) Similar to former 2 O.S. § 9-98. There is no previous comparable Oklahoma law applicable to bills of lading.

(6) New.