UCC - Article 7

Question 1

What are the effects of forgery on negotiable documents?

Answer 1

It defeats the rights of any holder to either the document or the goods.

Question 2

Define “warehouse receipt.”

Answer 2

A receipt issued by a person engaged in the business of storing goods

Question 3

Describe the concept of duty of care and right of payment regarding possessions of goods.

Answer 3

1. )Carriers and the warehouse must exercise care over the goods in their possession.
2. )Warehouses and carriers can place possessory liens on the goods to get payment

Question 4

List the types of documents of titles

Answer 4

1. )Bills of lading
2. )Air bills
3. )Warehouse receipts
4. )Dock warrants
5. )Others where document in business evidences that the person in possession has title and right to receive the goods

Question 5

List the most common documents of title

Answer 5

1. )Bills of lading

2. )Warehouse receipts

Question 6

Describe the concept of carrier’s duty of care

Answer 6

Absolute or strict liability with some exceptions

Question 7

How are negotiable and nonnegotiable documents of title transferred?

Answer 7

1. )Negotiable documents of title—through due negotiation; transfer through due negotiation by delivery or indorsement
2. )Nonnegotiable documents of title—transfer by assignment

Question 8

Define “bill of lading.”

Answer 8

A document evidencing the receipt of goods by a carrier for shipment

Question 9

What are the requirements that must be met in a document of title for it to be negotiable?

Answer 9

1. )By its terms, the goods are to be delivered to the bearer or order of the consignee or person to whom delivery is to be made.
2. )If it is an international document, and it runs to a named person or assigns

Question 10

Define the term “through bill of lading.”

Answer 10

More than one carrier

Question 11

What effect does a document of title for stolen goods have?

Answer 11

Documents of title for stolen goods do not pass title. A thief can never pass good title

Question 12

What degree of care should a warehouse company meet regarding shipment of goods?

Answer 12

High degree of care

Question 13

Define the term “destination bill of lading.”

Answer 13

One to be issued at destination (i.e., place of delivery)