§ 34.1-7-504 — Rights acquired in absence of due negotiation; effect of diversion; stoppage of delivery

(a) A transferee of a document of title, whether
negotiable or nonnegotiable, to which the document has been
delivered but not duly negotiated, acquires the title and rights
that its transferor had or had actual authority to convey.
(b) In the case of a transfer of a nonnegotiable document
of title, until but not after the bailee receives notice of the
transfer, the rights of the transferee may be defeated:
(i) By those creditors of the transferor which could
treat the transfer as void under W.S. 34.1-2-402 or
34.1-2.A-308;
(ii) By a buyer from the transferor in ordinary
course of business if the bailee has delivered the goods to the
buyer or received notification of the buyer's rights;
(iii) By a lessee from the transferor in ordinary
course of business if the bailee has delivered the goods to the
lessee or received notification of the lessee's rights; or
(iv) As against the bailee, by good-faith dealings of
the bailee with the transferor.
(c) A diversion or other change of shipping instructions
by the consignor in a nonnegotiable bill of lading which causes
the bailee not to deliver the goods to the consignee defeats the
consignee's title to the goods if the goods have been delivered
to a buyer in ordinary course of business or a lessee in
ordinary course of business and, in any event, defeats the
consignee's rights against the bailee.
(d) Delivery of the goods pursuant to a nonnegotiable
document of title may be stopped by a seller under W.S.
34.1-2-705 or a lessor under W.S. 34.1-2.A-526, subject to the
requirements of due notification in those sections. A bailee
that honors the seller's or lessor's instructions is entitled to
be indemnified by the seller or lessor against any resulting
loss or expense.