1. (a) Except as provided by subsection (b) of this section, a consignee entrusted with and in possession of a possessory document is considered the true owner of the goods described in the document for the purpose of any contract with a third person for:

   1. (1) The sale or disposal of the goods; or
   2. (2) The pledge or deposit of them as security for any money or negotiable instrument advanced or given on the faith of the possessory document.
2. (b) A contract, pledge, or deposit described in subsection (a) of this section is not valid if the third person has notice that the consignee is not the true owner of the goods.

Added by Acts 1975, c. 49, § 3, eff. July 1, 1975.

Formerly Art. 2, § 3.