(a) A work of art received as a consignment shall remain trust property, notwithstanding the subsequent purchase thereof by the consignee directly or indirectly for the consignee’s own account, until the price is paid in full to the consignor. If such work is thereafter resold to a bona fide purchaser before the consignor has been paid in full, the proceeds of the resale received by the consignee shall constitute funds held in trust for the benefit of the consignor to the extent necessary to pay any balance still due to the consignor, and such trusteeship shall continue until the fiduciary obligation of the consignee with respect to such transaction is discharged in full.

Terms Used In Tennessee Code 47-25-1005

  • Code: includes the Tennessee Code and all amendments and revisions to the code and all additions and supplements to the code. See Tennessee Code 1-3-105
  • Consignment: means that no title to, estate in, or right to possession of, the work of art, superior to that of the consignor shall vest in the consignee, notwithstanding the consignee's power or authority to transfer and convey to a third person all of the right, title, and interest of the consignor in and to such work of art. See Tennessee Code 47-25-1002
  • Fiduciary: A trustee, executor, or administrator.
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Property: includes both personal and real property. See Tennessee Code 1-3-105
  • Uniform Commercial Code: A set of statutes enacted by the various states to provide consistency among the states' commercial laws. It includes negotiable instruments, sales, stock transfers, trust and warehouse receipts, and bills of lading. Source: OCC
  • Work of art: means an original art work which is:
    (A) A visual rendition, including a painting, drawing, sculpture, mosaic, or photograph. See Tennessee Code 47-25-1002
(b) No such trust property or trust funds shall be or become subject or subordinate to any claims, liens, or security interests of any kind or nature whatsoever, of the consignee’s creditors, anything in the Uniform Commercial Code, § 47-2-326, or any other provision of the Uniform Commercial Code to the contrary notwithstanding.
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