Entrusting definition

Entrusting includes any delivery and any acquiescence in retention of possession regardless of any condition expressed between the parties to the delivery or acquiescence and regardless of whether the procurement of the entrusting or the possessor's disposition of the goods have been such as to be larcenous under the criminal law.
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Entrusting is defined very broadly in 2-403(3). It includes any delivery or acquiescence in retention of possession, regardless of any condition expressed between the parties as to the delivery or acquiescence and regardless of the illegal or illicit nature of the disposition. Example: Lender has a security interest in Debtor’s equipment and has a negative covenant against the equipment’s sale. Debtor nevertheless sells the equipment to Dealer. ▇▇▇▇▇▇ discovers the sale and knows the equipment is in Dealer’s hands, but takes no action. ▇▇▇▇▇▇ subsequently sells the collateral to Buyer. Under 2-403(2), the Buyer takes the goods free of the security interest. (Note: 9-320(a) would not apply because no security agreement would have a negative covenant against the sale of inventory.) Buyers of Consumer Goods 9-301(1) provides for automatic perfection of security interests in consumer goods. However, under 9-320(b), a buyer of goods from a person who used or bought the goods for use primarily for personal, family, or household purposes takes free of a security interest, even if perfected, if the buyer buys (i) without knowledge of the security interest; (ii) for value; (iii) primarily for the buyer’s personal, family, or household purposes; and (iv) before the filing of a financing statement covering the goods. The Double Debtor Problem
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Examples of Entrusting in a sentence

  • Entrusting Party and Party C agrees that Party B may assign its obligations and rights under this Agreement to any third party upon a prior written notice to Entrusting Party and Party C.

  • In consideration of the foregoing grant of voting rights by the Entrusting Party, Party B agrees to arrange for funds to be provided as necessary to Party C in connection with the business (the “Financial Support”).

  • If the Entrusting Party has transferred all his or her equity interests in Party C subject to the prior consent of Party B, the obligations and warranties under this Agreement of the Entrusting Party shall be undertaken by the assignee.

  • The Entrusting Party shall provide appropriate assistance to the Designee for the performance of proxy rights provided in this Agreement, including signing and executing the shareholders’ resolution and other relevant legal documents (if applicable) which have been confirmed by the Designee.

  • The handling fees related to the entrust loan shall be paid by the Entrusting Party.

  • The Lender will not commence draw-down procedures until the funds of the Entrusting Party have been remitted into the account of the Lender for entrustment loans.

  • The commission for the Entrustment Loan shall be paid by the Entrusting Party on a lump-sum basis before draw-down of the loan.

  • Entrusting Party: The person who, Recipient or not, acts on the basis of a Certificate or an Electronic Signature.

  • If one of the Entrusting Parties has transferred all his or her equity interests in Party C subject to the prior consent of Party B, the obligations and warranties under this Agreement of the remaining Entrusting Party shall not be affected.

  • Where Party A fails to release any loan according to the date and amount agreed in any entrusted loan notice, it shall pay liquidated damages of one ten thousandth of the amount of the liquidated damages for each day to Party B according to the actual number of days of default, except that Party A releases any loan in full and in time due to Party B’s violation of the provisions of this Agreement or the Entrusting Party’s failure to deposit funds into its account opened in Party A in time and in full.