(810 ILCS 5/2-505)
(from Ch. 26, par. 2-505)
Seller's shipment under reservation.
(1) Where the seller has identified goods to the contract by or before
(a) his procurement of a negotiable bill of lading to
his own order or otherwise reserves in him a security interest in the goods. His procurement of the bill to the order of a financing agency or of the buyer indicates in addition only the seller's expectation of transferring that interest to the person named.
(b) a non-negotiable bill of lading to himself or his
nominee reserves possession of the goods as security but except in a case of conditional delivery (subsection (2) of Section 2-507 a non-negotiable bill of lading naming the buyer as consignee reserves no security interest even though the seller retains possession or control of the bill of lading.
(2) When shipment by the seller with reservation of a security interest
is in violation of the contract for sale it constitutes an improper
contract for transportation within the preceding section but impairs
neither the rights given to the buyer by shipment and identification of the
goods to the contract nor the seller's powers as a holder of a negotiable
document of title.
(Source: P.A. 95-895, eff. 1-1-09