§ 25-2-501. Insurable interest in goods; manner of identification of goods. - North Carolina Statutes

Part 5.

Performance.

§ 25‑2‑501. Insurable interest in goods; manner of identification of goods.

(1)        The buyer obtains aspecial property and an insurable interest in goods by identification ofexisting goods as goods to which the contract refers even though the goods soidentified are nonconforming and he has an option to return or reject them.Such identification can be made at any time and in any manner explicitly agreedto by the parties. In the absence of explicit agreement identification occurs

(a)        when the contract ismade if it is for the sale of goods already existing and identified;

(b)        if the contract isfor the sale of future goods other than those described in paragraph (c), whengoods are shipped, marked or otherwise designated by the seller as goods towhich the contract refers;

(c)        when the crops areplanted or otherwise become growing crops or the young are conceived if thecontract is for the sale of unborn young to be born within twelve months aftercontracting or for the sale of crops to be harvested within twelve months orthe next normal harvest season after contracting whichever is longer.

(2)        The seller retainsan insurable interest in goods so long as title to or any security interest inthe goods remains in him and where the identification is by the seller alone hemay until default or insolvency or notification to the buyer that theidentification is final substitute other goods for those identified.

(3)        Nothing in thissection impairs any insurable interest recognized under any other statute orrule of law. (1965, c. 700, s. 1; 1967, c. 24, s. 8.)