§ 6A-8-107 - Whether indorsement, instruction, or entitlement order is effective.
SECTION 6A-8-107
§ 6A-8-107 Whether indorsement,instruction, or entitlement order is effective. – (a) "Appropriate person" means:
(1) with respect to an indorsement, the person specified by asecurity certificate or by an effective special indorsement to be entitled tothe security;
(2) with respect to an instruction, the registered owner ofan uncertificated security;
(3) with respect to an entitlement order, the entitlementholder;
(4) if the person designated in paragraph (1), (2), or (3) isdeceased, the designated person's successor taking under other law or thedesignated person's personal representative acting for the estate of thedecedent; or
(5) if the person designated in paragraph (1), (2), or (3)lacks capacity, the designated person's guardian, conservator, or other similarrepresentative who has power under other law to transfer the security orfinancial asset.
(b) An indorsement, instruction, or entitlement order iseffective if:
(1) it is made by the appropriate person;
(2) it is made by a person who has power under the law ofagency to transfer the security or financial asset on behalf of the appropriateperson, including, in the case of an instruction or entitlement order, a personwho has control under § 6A-8-106(c)(2) or (d)(2); or
(3) the appropriate person has ratified it or is otherwiseprecluded from asserting its ineffectiveness.
(c) An indorsement, instruction, or entitlement order made bya representative is effective even if:
(1) the representative has failed to comply with acontrolling instrument or with the law of the state having jurisdiction of therepresentative relationship, including any law requiring the representative toobtain court approval of the transaction; or
(2) the representative's action in making the indorsement,instruction, or entitlement order or using the proceeds of the transaction isotherwise a breach of duty.
(d) If a security is registered in the name of or speciallyindorsed to a person described as a representative, or if a securities accountis maintained in the name of a person described as a representative, anindorsement, instruction, or entitlement order made by the person is effectiveeven though the person is no longer serving in the described capacity.
(e) Effectiveness of an indorsement, instruction, orentitlement order is determined as of the date the indorsement, instruction, orentitlement order is made, and an indorsement, instruction, or entitlementorder does not become ineffective by reason of any later change ofcircumstances.