AN ACT TO AMEND TITLE 11, DELAWARE CODE, RELATING TO CRIMES, BY PROVIDING PENALTIES FOR FRAUDULENT PRACTICES UNDER THE UNIFORM COMMERCIAL CODE.
Be it enacted by the General Assembly of the State of Delaware:
Section 1. Title 11, Delaware Code, is amended by adding thereto a new section to read:
§ 560. Fraudulent practices under the Uniform Commercial Code
As used in this section--
"Bailee" shall have the same meaning as it has in the Uniform Commercial Code and shall also include any agent, servant or officer of a bailee.
"Issue" includes aiding in issuing.
"Person" in addition to the definition contained in Section 302, Title 1, also includes any agent, servant or officer thereof.
"Document", "document of title", "negotiable document of title", "non-negotiable document of title", "negotiable warehouse receipt", "security interest" and "warehouseman" shall have the same meanings as they have in the Uniform Commercial Code.
"Uniform Commercial Code" means the Uniform Commercial Code as it appears in title 5A.
()Fraudulent practices of bailees
No person, being a bailee
(1) shall issue a document of title
(i) knowing that the goods covered by the document of title have not been actually received by him, or are not under his control at the time the document is issued, or
(ii) knowing that it contains any false statement.
(2) except as provided in Section 7-60 of the Uniform Commercial Code, shall issue a duplicate or additional negotiable document of title knowing that a former negotiable document of title for the same goods or any part of them is outstanding and uncancelled.
(c) Fraudulent negotiation of document of title
No person, with intent to defraud, shall obtain a negotiable document of title for goods to which he does not have title, or which are subject to a security interest, and negotiate the document for value, without disclosing his want of title or the existence of the security interest.
(d) Negotiation of document of title when goods are not in bailee's possession
No person, with intent to defraud, shall negotiate or transfer for value a document of title which by the terms thereof represents that goods are in possession of the bailee which issued the document, knowing that the bailee is not in possession of the goods or any part thereof, without disclosing this fact.
(e) Inducing bailee to issue document of title when goods have not been received
No person, with intent to defraud, shall secure the issue by a bailee of a negotiable document of title knowing at the time of issue that any or all of the goods are not in possession of the bailee, by inducing the bailee to believe that the goods are in the bailee's possession.
(f) Passing off of non-negotiable document of title as being negotiable
No person, with intent to defraud, shall mislead or assist in misleading any person to reasonably believe a non-negotiable document of title is a negotiable document of title.
(g) Delivery of goods by bailee without obtaining negotiable document
Except as provided in Sections 7-403 and 7-601 of the Uniform Commercial Code, no person, being a bailee, shall deliver goods knowing that they are covered by an outstanding document of title, the negotiation of which would transfer the right to possession thereof, without obtaining the negotiable document.
(h) Noting ownership of goods on negotiable warehouse receipts
No person, being a warehouseman or any agent, servant or officer thereof, in possession of goods which he owns in part, wholly or jointly, shall issue a negotiable warehouse receipt therefor, without noting his ownership on the receipt.
(i) Penalties; jurisdiction.
Whoever is convicted of violating the provisions of this section shall be fined not more than $5,000 or be imprisoned for not more than 5 years, or both. Each act shall be deemed a separate offense. The Superior Court of New Castle County and the Courts of Common Pleas of Kent County and Sussex County shall have jurisdiction of offenses under this section.
Approved June 28, 1968.