1. (a) When a person delivers an item to a retail merchant for the purpose of:

   1. (1) sale;
   2. (2) exhibition; or

   3. (3) sale and exhibition;

      for a commission, the delivery to and acceptance of the item by the retail merchant places the item on consignment, unless the delivery is under an outright sale for which the person receives full compensation for the item upon delivery.

2. (b) A retail merchant described in subsection (a) is the agent of the person with respect to an item described in subsection (a).
3. (c) An item described in subsection (a) is trust property and the retail merchant is trustee for the benefit of the person until the item is sold to a bona fide purchaser or returned to the person.

4. (d) Except as provided in subsection (e), this subsection does not apply to a deposit placed by a customer on an item. The proceeds of the sale of an item described in subsection (a) are trust property. The retail merchant is trustee for the benefit of the person until the amount due the person from the sale is paid in full. Unless the retail merchant and the person expressly agree otherwise in writing:

   1. (1) a retail merchant shall pay the person the proceeds of the sale of an item not later than thirty (30) days after the retail merchant receives the payment; and

   2. (2) if the sale of the item is on installment, the retail merchant shall first apply funds from an installment to pay any balance due to the person on the sale.

      The terms of an express written agreement that alters a provision set forth in subdivision (1) or (2) must be clear and conspicuous.

5. (e) If:

   1. (1) a customer who has placed a deposit on an item purchases the item; and

   2. (2) the customer's deposit is used in whole or in part to pay for the item;

      the deposit shall be treated in accordance with subsection (d).

6. (f) Except as provided in subsection (g), if an item is lost or damaged while in the possession of a retail merchant, the retail merchant is strictly liable for the loss or damage in an amount equal to the value of the item as set forth in section 11(a)(1) of this chapter.

7. (g) A retail merchant is not liable for the loss of or damage to an item in the retail merchant's possession if:

   1. (1) the loss or damage occurs more than thirty (30) days after:

      1. (A) the date by which the person must remove the item, as specified in a written agreement between the retail merchant and the person; or
      2. (B) the date on which the retail merchant sends written notice to the person by registered mail at the person's last known address that the person must remove the item, if a written agreement described in clause (A) does not exist; and
   2. (2) the item was in the retail merchant's possession at the time of the loss or damage because the person failed to remove the item.

As added by P.L.85-2009, SEC.2.