Maine Revised Statutes Title 11 Sec. 8-1108 – Warranties in direct holding
Current as of: 2023 | Check for updates
|
Other versions
(1). A person who transfers a certificated security to a purchaser for value warrants to the purchaser and an indorser, if the transfer is by indorsement, warrants to any subsequent purchaser that:
(a). The certificate is genuine and has not been materially altered; [PL 1997, c. 429, Pt. B, §2 (NEW).]
(b). The transferor or indorser does not know of any fact that might impair the validity of the security; [PL 1997, c. 429, Pt. B, §2 (NEW).]
(c). There is no adverse claim to the security; [PL 1997, c. 429, Pt. B, §2 (NEW).]
(d). The transfer does not violate any restriction on transfer; [PL 1997, c. 429, Pt. B, §2 (NEW).]
(e). If the transfer is by indorsement, the indorsement is made by an appropriate person, or, if the indorsement is by an agent, the agent has actual authority to act on behalf of the appropriate person; and [PL 1997, c. 429, Pt. B, §2 (NEW).]
(f). The transfer is otherwise effective and rightful. [PL 1997, c. 429, Pt. B, §2 (NEW).]
[PL 1997, c. 429, Pt. B, §2 (NEW).]
Terms Used In Maine Revised Statutes Title 11 Sec. 8-1108
- Adverse claim: means a claim that a claimant has a property interest in a financial asset and that it is a violation of the rights of the claimant for another person to hold, transfer or deal with the financial asset. See Maine Revised Statutes Title 11 Sec. 8-1102
- Broker: means a person defined as a broker or dealer under the federal securities laws, but without excluding a bank acting in that capacity. See Maine Revised Statutes Title 11 Sec. 8-1102
- Certificated security: means a security that is represented by a certificate. See Maine Revised Statutes Title 11 Sec. 8-1102
- Indorsement: means a signature that alone or accompanied by other words is made on a security certificate in registered form or on a separate document for the purpose of assigning, transferring or redeeming the security or granting a power to assign, transfer or redeem it. See Maine Revised Statutes Title 11 Sec. 8-1102
- Instruction: means a notification communicated to the issuer of an uncertificated security that directs that the transfer of the security be registered or that the security be redeemed. See Maine Revised Statutes Title 11 Sec. 8-1102
- Security: except as otherwise provided in section 8?1103, means an obligation of an issuer or a share, participation or other interest in an issuer or in property or an enterprise of an issuer: (i) That is represented by a security certificate in bearer or registered form or the transfer of which may be registered upon books maintained for that purpose by or on behalf of the issuer;(ii) That is one of a class or series or by its terms is divisible into a class or series of shares, participations, interests or obligations; and(iii) That:(A) Is, or is of a type, dealt in or traded on securities exchanges or securities markets; or(B) Is a medium for investment and by its terms expressly provides that it is a security governed by this Article. See Maine Revised Statutes Title 11 Sec. 8-1102
- Security certificate: means a certificate representing a security. See Maine Revised Statutes Title 11 Sec. 8-1102
- Uncertificated security: means a security that is not represented by a certificate. See Maine Revised Statutes Title 11 Sec. 8-1102
(2). A person who originates an instruction for registration of transfer of an uncertificated security to a purchaser for value warrants to the purchaser that:(a). The instruction is made by an appropriate person or, if the instruction is by an agent, the agent has actual authority to act on behalf of the appropriate person; [PL 1997, c. 429, Pt. B, §2 (NEW).](b). The security is valid; [PL 1997, c. 429, Pt. B, §2 (NEW).](c). There is no adverse claim to the security; and [PL 1997, c. 429, Pt. B, §2 (NEW).](d). At the time the instruction is presented to the issuer:(i) The purchaser will be entitled to the registration of transfer;(ii) The transfer will be registered by the issuer free from all liens, security interests, restrictions and claims other than those specified in the instruction;(iii) The transfer will not violate any restriction on transfer; and(iv) The requested transfer will otherwise be effective and rightful. [PL 1997, c. 429, Pt. B, §2 (NEW).][PL 1997, c. 429, Pt. B, §2 (NEW).]
(3). A person who transfers an uncertificated security to a purchaser for value and does not originate an instruction in connection with the transfer warrants that:(a). The uncertificated security is valid; [PL 1997, c. 429, Pt. B, §2 (NEW).](b). There is no adverse claim to the security; [PL 1997, c. 429, Pt. B, §2 (NEW).](c). The transfer does not violate any restriction on transfer; and [PL 1997, c. 429, Pt. B, §2 (NEW).](d). The transfer is otherwise effective and rightful. [PL 1997, c. 429, Pt. B, §2 (NEW).][PL 1997, c. 429, Pt. B, §2 (NEW).]
(4). A person who indorses a security certificate warrants to the issuer that:(a). There is no adverse claim to the security; and [PL 1997, c. 429, Pt. B, §2 (NEW).](b). The indorsement is effective. [PL 1997, c. 429, Pt. B, §2 (NEW).][PL 1997, c. 429, Pt. B, §2 (NEW).]
(5). A person who originates an instruction for registration of transfer of an uncertificated security warrants to the issuer that:(a). The instruction is effective; and [PL 1997, c. 429, Pt. B, §2 (NEW).](b). At the time the instruction is presented to the issuer the purchaser will be entitled to the registration of transfer. [PL 1997, c. 429, Pt. B, §2 (NEW).][PL 1997, c. 429, Pt. B, §2 (NEW).]
(6). A person who presents a certificated security for registration of transfer or for payment or exchange warrants to the issuer that the person is entitled to the registration, payment or exchange, but a purchaser for value and without notice of adverse claims to whom transfer is registered warrants only that the person has no knowledge of any unauthorized signature in a necessary indorsement.[PL 1997, c. 429, Pt. B, §2 (NEW).]
(7). If a person acts as agent of another in delivering a certificated security to a purchaser, the identity of the principal was known to the person to whom the certificate was delivered and the certificate delivered by the agent was received by the agent from the principal or received by the agent from another person at the direction of the principal, the person delivering the security certificate warrants only that the delivering person has authority to act for the principal and does not know of any adverse claim to the certificated security.[PL 1997, c. 429, Pt. B, §2 (NEW).]
(8). A secured party who redelivers a security certificate received or, after payment and on order of the debtor delivers the security certificate to another person, makes only the warranties of an agent under subsection (7).[PL 1997, c. 429, Pt. B, §2 (NEW).]
(9). Except as otherwise provided in subsection (7), a broker acting for a customer makes to the issuer and a purchaser the warranties provided in subsections (1) to (6). A broker that delivers a security certificate to its customer or causes its customer to be registered as the owner of an uncertificated security makes to the customer the warranties provided in subsection (1) or (2) and has the rights and privileges of a purchaser under this section. The warranties of and in favor of the broker acting as an agent are in addition to applicable warranties given by and in favor of the customer.[PL 1997, c. 429, Pt. B, §2 (NEW).]
SECTION HISTORYPL 1997, c. 429, §B2 (NEW).