§ 41-08-07 — (8-107) Whether endorsement, instruction, or entitlement order is effective

North Dakota § 41-08-07

• Jurisdiction: North Dakota
• Title 41: Uniform Commercial Code
• Ch. 41-08: Investment Securities

Text

1. "Appropriate person" means:
a. With respect to an endorsement, the person specified by a security certificate or
by an effective special endorsement to be entitled to the security;
b. With respect to an instruction, the registered owner of an uncertificated security;
c. With respect to an entitlement order, the entitlement holder;
d. If the person designated in subdivision a, b, or c is deceased, the designated
person's successor taking under other law or the designated person's personal
representative acting for the estate of the decedent; or
e. If the person designated in subdivision a, b, or c lacks capacity, the designated
person's guardian, conservator, or other similar representative who has power
under other law to transfer the security or financial asset.
2. An endorsement, instruction, or entitlement order is effective if:
a. It is made by the appropriate person;
b. It is made by a person who has power under the law of agency to transfer the
security or financial asset on behalf of the appropriate person, including, in the
case of an instruction or entitlement order, a person who has control under
subdivision b of subsection 3 or subdivision b of subsection 4 of section 41-08-06;
or
c. The appropriate person has ratified it or is otherwise precluded from asserting its
ineffectiveness.
3. An endorsement, instruction, or entitlement order made by a representative is effective
even if:
a. The representative has failed to comply with a controlling instrument or with the
law of the state having jurisdiction of the representative relationship, including any
law requiring the representative to obtain court approval of the transaction; or
b. The representative's action in making the endorsement, instruction, or entitlement
order or using the proceeds of the transaction is otherwise a breach of duty.
4. If a security is registered in the name of or specially endorsed to a person described
as a representative, or if a securities account is maintained in the name of a person
described as a representative, an endorsement, instruction, or entitlement order made
by the person is effective even though the person is no longer serving in the described
capacity.
5. Effectiveness of an endorsement, instruction, or entitlement order is determined as of
the date the endorsement, instruction, or entitlement order is made, and an
endorsement, instruction, or entitlement order does not become ineffective by reason
of any later change of circumstances.