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336.2-401 PASSING OF TITLE; RESERVATION FOR SECURITY; LIMITED
APPLICATION OF THIS SECTION.
Each provision of this article with regard to the rights, obligations and remedies of the seller,
the buyer, purchasers or other third parties applies irrespective of title to the goods except where
the provision refers to such title. Insofar as situations are not covered by the other provisions of
this article and matters concerning title become material the following rules apply:
(1) Title to goods cannot pass under a contract for sale prior to their identification to the
contract (section 336.2-501), and unless otherwise explicitly agreed the buyer acquires by their
identification a special property as limited by this chapter. Any retention or reservation by the
seller of the title (property) in goods shipped or delivered to the buyer is limited in effect to a
reservation of a security interest. Subject to these provisions and to the provisions of the article on
secured transactions (article 9), title to goods passes from the seller to the buyer in any manner
and on any conditions explicitly agreed on by the parties.
(2) Unless otherwise explicitly agreed title passes to the buyer at the time and place at which
the seller completes performance with reference to the physical delivery of the goods, despite
any reservation of a security interest and even though a document of title is to be delivered
at a different time or place; and in particular and despite any reservation of a security interest
by the bill of lading
(a) if the contract requires or authorizes the seller to send the goods to the buyer but does
not require the seller to deliver them at destination, title passes to the buyer at the time and
place of shipment; but
(b) if the contract requires delivery at destination, title passes on tender there.
(3) Unless otherwise explicitly agreed where delivery is to be made without moving the
goods,
(a) if the seller is to deliver a tangible document of title, title passes at the time when and
the place where the seller delivers such documents, and if the seller is to deliver an electronic
document of title, title passes when the seller delivers the document; or
(b) if the goods are at the time of contracting already identified and no documents of title are
to be delivered, title passes at the time and place of contracting.
(4) A rejection or other refusal by the buyer to receive or retain the goods, whether or not
justified, or a justified revocation of acceptance revests title to the goods in the seller. Such
revesting occurs by operation of law and is not a "sale."
History: 1965 c 811 s 336.2-401; 1986 c 444; 2004 c 162 art 5 s 5

Official Publication of the State of Minnesota
Revisor of Statutes