§ 25-2A-511. Merchant lessee's duties as to rightfully rejected goods.
§25‑2A‑511. Merchant lessee's duties as to rightfully rejectedgoods.
(1) Subject to anysecurity interest of a lessee (G.S. 25‑2A‑508(5)), if a lessor or asupplier has no agent or place of business at the market of rejection, amerchant lessee, after rejection of goods in his possession or control, shallfollow any reasonable instructions received from the lessor or the supplierwith respect to the goods. In the absence of those instructions, a merchantlessee shall make reasonable efforts to sell, lease, or otherwise dispose ofthe goods for the lessor's account if they threaten to decline in valuespeedily. Instructions are not reasonable if, on demand, indemnity forexpenses is not forthcoming.
(2) If a merchantlessee (subsection (1) of this section) or any other lessee (G.S. 25‑2A‑512)disposes of goods, he is entitled to reimbursement either from the lessor orthe supplier or out of the proceeds for reasonable expenses of caring for anddisposing of the goods and, if the expenses include no disposition commission,to such commission as is usual in the trade, or if there is none, to areasonable sum not exceeding ten percent (10%) of the gross proceeds.
(3) In complying withthis section or G.S. 25‑2A‑512, the lessee is held only to goodfaith. Good faith conduct hereunder is neither acceptance or conversion northe basis of an action for damages.
(4) A purchaser whopurchases in good faith from a lessee pursuant to this section or G.S. 25‑2A‑512takes the goods free of any rights of the lessor and the supplier even thoughthe lessee fails to comply with one or more of the requirements of thisArticle. (1993, c. 463, s. 1.)