Michigan Compiled Laws

Mich. Comp. Laws § 440.7204 (2026)

Duty of care; contractual limitation of warehouse liability; provisions as to time and manner of presenting claims and commencing actions.

✓ current as of July 2026

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UNIFORM COMMERCIAL CODE

Act 174 of 1962

440.7204 Duty of care; contractual limitation of warehouse liability; provisions as to time and manner of presenting claims and commencing actions.

Sec. 7204.

(1) A warehouse is liable for damages for loss of or injury to the goods caused by its failure to exercise care with regard to the goods that a reasonably careful person would exercise under similar circumstances. Unless otherwise agreed, the warehouse is not liable for damages that could not have been avoided by the exercise of that care.

(2) Damages may be limited by a term in a warehouse receipt or storage agreement limiting the amount of liability in case of loss or damage beyond which the warehouse is not liable. Such a limitation is not effective with respect to the warehouse's liability for conversion to its own use. On request of the bailor in a record at the time of signing the storage agreement or within a reasonable time after receipt of the warehouse receipt, the warehouse's liability may be increased on part or all of the goods covered by the storage agreement or the warehouse receipt. In this event, increased rates may be charged based on an increased valuation of the goods.

(3) Reasonable provisions as to the time and manner of presenting claims and commencing actions based on the bailment may be included in the warehouse receipt or storage agreement.

History: 1962, Act 174, Eff. Jan. 1, 1964 ;-- Am. 2012, Act 87, Eff. July 1, 2013

Notes of Decisions

Cited in 5 cases, 1980–2013 · leading case: Aroma Wines & Equip., Inc. v. Columbian Distrib. Servs., Inc., 844 N.W.2d 727 (Mich. Ct. App. 2013).

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Aroma Wines & Equip., Inc. v. Columbian Distrib. Servs., Inc., 844 N.W.2d 727 (Mich. Ct. App. 2013). “7209 and MCL 440.7204, common-law conversion, and statutory conversion, MCL 600.”

Indem. Marine Assurance Co. v. Lipin Robinson Warehouse Corp., 297 N.W.2d 846 (Mich. Ct. App. 1980). · cites it 4× “MCL 440.7204(1); MSA 19.7204(1) provides: *13 "A warehouseman is liable for damages for loss of or injury to the goods caused by his failure to exercise such care in regard to them as a reasonably careful man would exercise under like circumstances but unless otherwise agreed he…”

Cargill, Inc. v. Boag Cold Storage Warehouse, Inc., 71 F.3d 545 (6th Cir. 1996). “§ 7-204(2) (Mich. Comp. Laws 440.7204(2)), which authorizes the inclusion in warehouse receipts of contract terms limiting liability in ease of loss or damage.”

Menorah Ins. v. W.F. Whelan Co., 110 F. App'x 524 (6th Cir. 2004). · cites it 3× “Mich. Comp. Laws § 440.7204 (2) provides that: [djamages may be limited by a term in the warehouse receipt or storage agreement limiting the amount of liability in case of loss or damage, and setting forth a specific liability per article or item, or value per unit of weight,…”

Pickler v. Durand Milling Co. (In Re Durand Milling Co.), 9 B.R. 669 (Bankr. E.D. Mich. 1981). “§ 440.7204(1). Section 7-203 of the U.C.C.”

— Mich. Comp. Laws § 440.7204(1) — 2 cases

Indem. Marine Assurance Co. v. Lipin Robinson Warehouse Corp., 297 N.W.2d 846 (Mich. Ct. App. 1980). “MCL 440.7204(1); MSA 19.7204(1) provides: *13 "A warehouseman is liable for damages for loss of or injury to the goods caused by his failure to exercise such care in regard to them as a reasonably careful man would exercise under like circumstances but unless otherwise agreed he…”

Pickler v. Durand Milling Co. (In Re Durand Milling Co.), 9 B.R. 669 (Bankr. E.D. Mich. 1981). “§ 440.7204(1). Section 7-203 of the U.C.C.”

— Mich. Comp. Laws § 440.7204(2) — 1 case

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