§ 336.2A-526 — Lessor's Stoppage of Delivery in Transit or Otherwise
Plain-Language Summary
This section lets a lessor stop goods from being delivered while they are still held by a carrier or other bailee. The lessor can stop delivery if it learns the lessee is insolvent, and can stop carload, truckload, planeload, or larger shipments if the lessee repudiates the lease, misses a payment due before delivery, or otherwise gives the lessor a right to take the goods. The lessor's ability to stop delivery ends once the lessee receives the goods or a bailee acknowledges holding the goods for the lessee. To stop delivery, the lessor must notify the bailee in time to prevent delivery, and the lessor is then liable to the bailee for any resulting charges or damages.
336.2A-526 LESSOR’S STOPPAGE OF DELIVERY IN TRANSIT OR OTHERWISE.
(1) A lessor may stop delivery of goods in the possession of a carrier or other bailee if the lessor discovers the lessee to be insolvent and may stop delivery of carload, truckload, planeload, or larger shipments of express or freight if the lessee repudiates or fails to make a payment due before delivery, whether for rent, security or otherwise under the lease contract, or for any other reason the lessor has a right to withhold or take possession of the goods.
(2) In pursuing its remedies under subsection (1), the lessor may stop delivery until
(a) receipt of the goods by the lessee;
(b) acknowledgment to the lessee by any bailee of the goods, except a carrier, that the bailee holds the goods for the lessee; or
(c) an acknowledgment to the lessee by a carrier via reshipment or as a warehouse.
(3)(a) To stop delivery, a lessor shall so notify as to enable the bailee by reasonable diligence to prevent delivery of the goods.
(b) After notification, the bailee shall hold and deliver the goods according to the directions of the lessor, but the lessor is liable to the bailee for any ensuing charges or damages.
(c) A carrier who has issued a nonnegotiable bill of lading is not obliged to obey a notification to stop received from a person other than the consignor.
History:
1986 c 444; 1989 c 232 art 1 s 2A-526; 2004 c 162 art 5 s 14
History: History: 1986 c 444; 1989 c 232 art 1 s 2A-526; 2004 c 162 art 5 s 14