35-06 Pledge
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<![CDATA[CHAPTER 35-06PLEDGE35-06-01. Pledge defined. Pledge is a deposit of personal property as security for theperformance of another act. Every contract by which the possession of personal property is<br>transferred as security only is a pledge and its validity and effect are governed by the provisions<br>of this chapter except as modified by the provisions of title 41.35-06-02.Lien of pledge dependent on possession.The lien of a pledge isdependent on possession and no pledge is valid until the property pledged is delivered to the<br>pledgee or to a pledgeholder as hereinafter prescribed.35-06-03.Increase of property pledged with property.The increase of propertypledged is pledged with the property.35-06-04. Lien may be pledged. One who has a lien upon property may pledge it to theextent of that person's lien.35-06-05. Pledge by apparent owner - Effect - Estoppel of actual owner. One whohas allowed another to assume the apparent ownership of property for the purpose of making<br>any transfer of it cannot set up that person's own title to defeat a pledge of the property made by<br>the other to a pledgee who received the property in good faith in the ordinary course of business<br>and for value.35-06-06. Pledge to secure another's obligation - Effect - Withdrawal. Property maybe pledged as security for the obligation of a person other than the owner and in so doing the<br>owner has all the rights of a pledgor for the owner except that one who pledges property as<br>security for the obligation of another cannot withdraw the property pledged otherwise than as a<br>pledgor might, and if the owner receives from the debtor a consideration for the pledge, the<br>owner cannot withdraw it without the debtor's consent.35-06-07. Pledgeholder defined - Duties. A pledgor and pledgee may agree upon athird person with whom to deposit the property pledged who, if the third person accepts the<br>deposit, is called a pledgeholder, and the third person must enforce all the rights of the pledgee<br>unless authorized by the pledgee to waive them.35-06-08. Liability of pledgee and of pledgeholder. A pledgee or a pledgeholder forreward assumes the duties and liabilities of a depositary for reward. A gratuitous pledgeholder<br>assumes the duties and liabilities of a gratuitous depositary.35-06-09. Exoneration of pledgeholder. A pledgeholder for reward cannot exoneratethe pledgeholder from the pledgeholder's undertaking, and a gratuitous pledgeholder can do so<br>only by giving reasonable notice to the pledgor and pledgee to appoint a new pledgeholder, and<br>in case of their failure to agree, by depositing the property pledged with some impartial person<br>who then will be entitled to a reasonable compensation for that person's care of the same.35-06-10. Fraudulent misrepresentation of property pledged - Rights of creditor.When a debtor has obtained credit or an extension of time by a fraudulent misrepresentation of<br>the value of the property pledged by or for the debtor, the creditor may demand a further pledge<br>to correspond with the value represented and in default thereof may recover the creditor's debt<br>immediately though it is not actually due.35-06-11. Pledge enforced - Sale when performance due. When performance of theact for which a pledge is given is due in whole or in part, the pledgee may collect what is due the<br>pledgee by a sale of the property pledged, subject to the rules and exceptions prescribed in this<br>chapter and in sections 41-09-98 through 41-09-123.35-06-12. Demand for performance necessary. Repealed by S.L. 1965, ch. 296, </p>
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