trust receipt
- A document that describes an agreement where a lender allows a borrower to have possession of goods, yet retains ownership. In this agreement, the borrower promises to keep the goods in trust for the lender, and if the goods are sold, the borrower agrees to pay the lender with the profit from the sale to repay the debt
- In order to facilitate business operations, Paul requested a trust receipt from the bank, which allowed him to hold the goods while the bank maintained title.
- Under the terms of the trust receipt, if the goods are sold, Susan must give all the sales money to the bank to repay the loan.
- While the goods were in transit, a trust receipt ensured that although the textiles were in my possession, the bank retained ownership.
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