§ 41-08-47 — (8-507) Duty of securities intermediary to comply with entitlement order

1. A securities intermediary shall comply with an entitlement order if the entitlement order
is originated by the appropriate person, the securities intermediary has had reasonable
opportunity to assure itself that the entitlement order is genuine and authorized, and
the securities intermediary has had reasonable opportunity to comply with the
entitlement order. A securities intermediary satisfies the duty if:
a. The securities intermediary acts with respect to the duty as agreed upon by the
entitlement holder and the securities intermediary; or
b. In the absence of agreement, the securities intermediary exercises due care in
accordance with reasonable commercial standards to comply with the entitlement
order.
2. If a securities intermediary transfers a financial asset pursuant to an ineffective
entitlement order, the securities intermediary shall re-establish a security entitlement in
favor of the person entitled to it, and pay or credit any payments or distributions that
the person did not receive as a result of the wrongful transfer. If the securities
intermediary does not re-establish a security entitlement, the securities intermediary is
liable to the entitlement holder for damages.