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https://law.justia.com/codes/alabama/title-7/article-7/part-1/section-7-7-103/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 1 - General.›Section 7-7-103 - Relation of Article to Treaty or Statute.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 1 - General. › Section 7-7-103 - Relation of Article to Treaty or Statute.
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Section 7-7-103
Relation of article to treaty or statute.
(a) This article is subject to any treaty or statute of the United States or regulatory statute of this state to the extent the treaty, statute, or regulatory statute is applicable.
(b) This article does not modify or repeal any law prescribing the form or content of a document of title or the services or facilities to be afforded by a bailee, or otherwise regulating a bailee's business in respects not specifically treated in this article. However, violation of such a law does not affect the status of a document of title that otherwise is within the definition of a document of title.
(c) This article modifies, limits, and supersedes the federal Electronic Signatures in Global and National Commerce Act (15 U.S.C. Section 7001, et seq.) but does not modify, limit, or supersede Section 101(c) of that act (15 U.S.C. Section 7001(c)) or authorize electronic delivery of any of the notices described in Section 103(b) of that act (15 U.S.C. Section 7003(b)).
(d) To the extent there is a conflict between the Alabama Uniform Electronic Transactions Act and this article, this article governs.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-1/section-7-7-104/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 1 - General.›Section 7-7-104 - Negotiable and Nonnegotiable Document of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 1 - General. › Section 7-7-104 - Negotiable and Nonnegotiable Document of Title.
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Section 7-7-104
Negotiable and nonnegotiable document of title.
(a) Except as otherwise provided in subsection (c), a document of title is negotiable if by its terms the goods are to be delivered to bearer or to the order of a named person.
(b) A document of title other than one described in subsection (a) is nonnegotiable. A bill of lading that states that the goods are consigned to a named person is not made negotiable by a provision that the goods are to be delivered only against an order in a record signed by the same or another named person.
(c) A document of title is nonnegotiable if, at the time it is issued, the document has a conspicuous legend, however expressed, that it is nonnegotiable.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-1/section-7-7-105/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 1 - General.›Section 7-7-105 - Reissuance in Alternative Medium.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 1 - General. › Section 7-7-105 - Reissuance in Alternative Medium.
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Section 7-7-105
Reissuance in alternative medium.
(a) Upon request of a person entitled under an electronic document of title, the issuer of the electronic document may issue a tangible document of title as a substitute for the electronic document if:
(1) The person entitled under the electronic document surrenders control of the document to the issuer; and
(2) The tangible document when issued contains a statement that it is issued in substitution for the electronic document.
(b) Upon issuance of a tangible document of title in substitution for an electronic document of title in accordance with subsection (a):
(1) The electronic document ceases to have any effect or validity; and
(2) The person that procured issuance of the tangible document warrants to all subsequent persons entitled under the tangible document that the warrantor was a person entitled under the electronic document when the warrantor surrendered control of the electronic document to the issuer.
(c) Upon request of a person entitled under a tangible document of title, the issuer of the tangible document may issue an electronic document of title as a substitute for the tangible document if:
(1) The person entitled under the tangible document surrenders possession of the document to the issuer; and
(2) The electronic document when issued contains a statement that it is issued in substitution for the tangible document.
(d) Upon issuance of an electronic document of title in substitution for a tangible document of title in accordance with subsection (c):
(1) The tangible document ceases to have any effect or validity; and
(2) The person that procured issuance of the electronic document warrants to all subsequent persons entitled under the electronic document that the warrantor was a person entitled under the tangible document when the warrantor surrendered possession of the tangible document to the issuer.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-1/section-7-7-106/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 1 - General.›Section 7-7-106 - Control of Electronic Document of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 1 - General. › Section 7-7-106 - Control of Electronic Document of Title.
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Section 7-7-106
Control of electronic document of title.
(a) A person has control of an electronic document of title if a system employed for evidencing the transfer of interests in the electronic document reliably establishes that person as the person to which the electronic document was issued or transferred.
(b) A system satisfies subsection (a), and a person is deemed to have control of an electronic document of title, if the document is created, stored, and assigned in such a manner that:
(1) A single authoritative copy of the document exists which is unique, identifiable, and, except as otherwise provided in subdivisions (4), (5), and (6), unalterable;
(2) The authoritative copy identifies the person asserting control as:
a. The person to which the document was issued; or
b. If the authoritative copy indicates that the document has been transferred, the person to which the document was most recently transferred;
(3) The authoritative copy is communicated to and maintained by the person asserting control or its designated custodian;
(4) Copies or amendments that add or change an identified assignee of the authoritative copy can be made only with the consent of the person asserting control;
(5) Each copy of the authoritative copy and any copy of a copy is readily identifiable as a copy that is not the authoritative copy; and
(6) Any amendment of the authoritative copy is readily identifiable as authorized or unauthorized.
(Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-201/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-201 - Person That May Issue a Warehouse Receipt; Storage Under Bond.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-201 - Person That May Issue a Warehouse Receipt; Storage Under Bond.
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Section 7-7-201
Person that may issue a warehouse receipt; storage under bond.
(a) A warehouse receipt may be issued by any warehouse.
(b) If goods, including distilled spirits and agricultural commodities, are stored under a statute requiring a bond against withdrawal or a license for the issuance of receipts in the nature of warehouse receipts, a receipt issued for the goods is deemed to be a warehouse receipt even if issued by a person that is the owner of the goods and is not a warehouse.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-202/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-202 - Form of Warehouse Receipt; Effect of Omission.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-202 - Form of Warehouse Receipt; Effect of Omission.
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Section 7-7-202
Form of warehouse receipt; effect of omission.
(a) A warehouse receipt need not be in any particular form.
(b) Unless a warehouse receipt provides for each of the following, the warehouse is liable for damages caused to a person injured by its omission:
(1) A statement of the location of the warehouse facility where the goods are stored;
(2) The date of issue of the receipt;
(3) The unique identification code of the receipt;
(4) A statement whether the goods received will be delivered to the bearer, to a named person, or to a named person or its order;
(5) The rate of storage and handling charges, unless goods are stored under a field warehousing arrangement, in which case a statement of that fact is sufficient on a nonnegotiable receipt;
(6) A description of the goods or the packages containing them;
(7) The signature of the warehouse or its agent;
(8) If the receipt is issued for goods that the warehouse owns, either solely, jointly, or in common with others, a statement of the fact of that ownership; and
(9) A statement of the amount of advances made and of liabilities incurred for which the warehouse claims a lien or security interest, unless the precise amount of advances made or liabilities incurred, at the time of the issue of the receipt, is unknown to the warehouse or to its agent that issued the receipt, in which case a statement of the fact that advances have been made or liabilities incurred and the purpose of the advances or liabilities is sufficient.
(c) A warehouse may insert in its receipt any terms that are not contrary to the Uniform Commercial Code and do not impair its obligation of delivery under Section 7-7-403 or its duty of care under Section 7-7-204. Any contrary provision is ineffective.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-203/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-203 - Liability for Nonreceipt or Misdescription.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-203 - Liability for Nonreceipt or Misdescription.
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Section 7-7-203
Liability for nonreceipt or misdescription.
A party to or purchaser for value in good faith of a document of title, other than a bill of lading, that relies upon the description of the goods in the document may recover from the issuer damages caused by the nonreceipt or misdescription of the goods, except to the extent that:
(1) The document conspicuously indicates that the issuer does not know whether all or part of the goods in fact were received or conform to the description, such as a case in which the description is in terms of marks or labels or kind, quantity, or condition, or the receipt or description is qualified by "contents, condition, and quality unknown," "said to contain," or words of similar import, if the indication is true; or
(2) The party or purchaser otherwise has notice of the nonreceipt or misdescription.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-204/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-204 - Duty of Care; Contractual Limitation of Warehouse's Liability.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-204 - Duty of Care; Contractual Limitation of Warehouse's Liability.
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Section 7-7-204
Duty of care; contractual limitation of warehouse's liability.
(a) 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.
(b) Damages may be limited by a term in the 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.
(c) 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.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-205/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-205 - Title Under Warehouse Receipt Defeated in Certain Cases.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-205 - Title Under Warehouse Receipt Defeated in Certain Cases.
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Section 7-7-205
Title under warehouse receipt defeated in certain cases.
A buyer in ordinary course of business of fungible goods sold and delivered by a warehouse that is also in the business of buying and selling such goods takes the goods free of any claim under a warehouse receipt even if the receipt is negotiable and has been duly negotiated.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-206/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-206 - Termination of Storage at Warehouse's Option.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-206 - Termination of Storage at Warehouse's Option.
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Section 7-7-206
Termination of storage at warehouse's option.
(a) A warehouse, by giving notice to the person on whose account the goods are held and any other person known to claim an interest in the goods, may require payment of any charges and removal of the goods from the warehouse at the termination of the period of storage fixed by the document of title or, if a period is not fixed, within a stated period not less than 30 days after the warehouse gives notice. If the goods are not removed before the date specified in the notice, the warehouse may sell them pursuant to Section 7-7-210.
(b) If a warehouse in good faith believes that goods are about to deteriorate or decline in value to less than the amount of its lien within the time provided in subsection (a) and Section 7-7-210, the warehouse may specify in the notice given under subsection (a) any reasonable shorter time for removal of the goods and, if the goods are not removed, may sell them at public sale held not less than one week after a single advertisement or posting.
(c) If, as a result of a quality or condition of the goods of which the warehouse did not have notice at the time of deposit, the goods are a hazard to other property, the warehouse facilities, or other persons, the warehouse may sell the goods at public or private sale without advertisement or posting on reasonable notification to all persons known to claim an interest in the goods. If the warehouse, after a reasonable effort, is unable to sell the goods, it may dispose of them in any lawful manner and does not incur liability by reason of that disposition.
(d) A warehouse shall deliver the goods to any person entitled to them under this article upon due demand made at any time before sale or other disposition under this section.
(e) A warehouse may satisfy its lien from the proceeds of any sale or disposition under this section but shall hold the balance for delivery on the demand of any person to which the warehouse would have been bound to deliver the goods.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-207/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-207 - Goods Must Be Kept Separate; Fungible Goods.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-207 - Goods Must Be Kept Separate; Fungible Goods.
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Section 7-7-207
Goods must be kept separate; fungible goods.
(a) Unless the warehouse receipt provides otherwise, a warehouse shall keep separate the goods covered by each receipt so as to permit at all times identification and delivery of those goods. However, different lots of fungible goods may be commingled.
(b) If different lots of fungible goods are commingled, the goods are owned in common by the persons entitled thereto and the warehouse is severally liable to each owner for that owner's share. If, because of overissue, a mass of fungible goods is insufficient to meet all the receipts the warehouse has issued against it, the persons entitled include all holders to which overissued receipts have been duly negotiated.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-208/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-208 - Altered Warehouse Receipts.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-208 - Altered Warehouse Receipts.
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Section 7-7-208
Altered warehouse receipts.
If a blank in a negotiable tangible warehouse receipt has been filled in without authority, a good faith purchaser for value and without notice of the lack of authority may treat the insertion as authorized. Any other unauthorized alteration leaves any tangible or electronic warehouse receipt enforceable against the issuer according to its original tenor.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-209/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-209 - Lien of Warehouse.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-209 - Lien of Warehouse.
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Section 7-7-209
Lien of warehouse.
(a) A warehouse has a lien against the bailor on the goods covered by a warehouse receipt or storage agreement or on the proceeds thereof in its possession for charges for storage or transportation, including demurrage and terminal charges, insurance, labor, or other charges, present or future, in relation to the goods, and for expenses necessary for preservation of the goods or reasonably incurred in their sale pursuant to law. If the person on whose account the goods are held is liable for similar charges or expenses in relation to other goods whenever deposited and it is stated in the warehouse receipt or storage agreement that a lien is claimed for charges and expenses in relation to other goods, the warehouse also has a lien against the goods covered by the warehouse receipt or storage agreement or on the proceeds thereof in its possession for those charges and expenses, whether or not the other goods have been delivered by the warehouse. However, as against a person to which a negotiable warehouse receipt is duly negotiated, a warehouse's lien is limited to charges in an amount or at a rate specified in the warehouse receipt or, if no charges are so specified, to a reasonable charge for storage of the specific goods covered by the receipt subsequent to the date of the receipt.
(b) A warehouse may also reserve a security interest against the bailor for the maximum amount specified on the receipt for charges other than those specified in subsection (a), such as for money advanced and interest. The security interest is governed by Article 9A.
(c) A warehouse's lien for charges and expenses under subsection (a) or a security interest under subsection (b) is also effective against any person that so entrusted the bailor with possession of the goods that a pledge of them by the bailor to a good faith purchaser for value would have been valid. However, the lien or security interest is not effective against a person that before issuance of a document of title had a legal interest or a perfected security interest in the goods and that did not:
(1) Deliver or entrust the goods or any document of title covering the goods to the bailor or the bailor's nominee with:
(A) Actual or apparent authority to ship, store, or sell;
(B) Power to obtain delivery under Section 7-7-403; or
(C) Power of disposition under Sections 7-2-403, 7-2A-304(2), 7-2A-305(2), 7-9A-320, or 7-9A-321(c) or other statute or rule of law; or
(2) Acquiesce in the procurement by the bailor or its nominee of any document.
(d) A warehouse's lien on household goods for charges and expenses in relation to the goods under subsection (a) is also effective against all persons if the depositor was the legal possessor of the goods at the time of deposit. In this subsection, "household goods" means furniture, furnishings, or personal effects used by the depositor in a dwelling.
(e) A warehouse loses its lien on any goods that it voluntarily delivers or unjustifiably refuses to deliver.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-2/section-7-7-210/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 2 - Warehouse Receipts: Special Provisions.›Section 7-7-210 - Enforcement of Warehouse's Lien.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 2 - Warehouse Receipts: Special Provisions. › Section 7-7-210 - Enforcement of Warehouse's Lien.
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Section 7-7-210
Enforcement of warehouse's lien.
(a) Except as otherwise provided in subsection (b), a warehouse's lien may be enforced by public or private sale of the goods, in bulk or in packages, at any time or place and on any terms that are commercially reasonable, after notifying all persons known to claim an interest in the goods. The notification must include a statement of the amount due, the nature of the proposed sale, and the time and place of any public sale. The fact that a better price could have been obtained by a sale at a different time or in a method different from that selected by the warehouse is not of itself sufficient to establish that the sale was not made in a commercially reasonable manner. The warehouse sells in a commercially reasonable manner if the warehouse sells the goods in the usual manner in any recognized market therefor, sells at the price current in that market at the time of the sale, or otherwise sells in conformity with commercially reasonable practices among dealers in the type of goods sold. A sale of more goods than apparently necessary to be offered to ensure satisfaction of the obligation is not commercially reasonable, except in cases covered by the preceding sentence.
(b) A warehouse may enforce its lien on goods, other than goods stored by a merchant in the course of its business, only if the following requirements are satisfied:
(1) All persons known to claim an interest in the goods must be notified.
(2) The notification must include an itemized statement of the claim, a description of the goods subject to the lien, a demand for payment within a specified time not less than 10 days after receipt of the notification, and a conspicuous statement that unless the claim is paid within that time the goods will be advertised for sale and sold by auction at a specified time and place.
(3) The sale must conform to the terms of the notification.
(4) The sale must be held at the nearest suitable place to where the goods are held or stored.
(5) After the expiration of the time given in the notification, an advertisement of the sale must be published once a week for two weeks consecutively in a newspaper of general circulation where the sale is to be held. The advertisement must include a description of the goods, the name of the person on whose account the goods are being held, and the time and place of the sale. The sale must take place at least 15 days after the first publication. If there is no newspaper of general circulation where the sale is to be held, the advertisement must be posted at least 10 days before the sale in not fewer than six conspicuous places in the neighborhood of the proposed sale.
(c) Before any sale pursuant to this section, any person claiming a right in the goods may pay the amount necessary to satisfy the lien and the reasonable expenses incurred in complying with this section. In that event, the goods may not be sold but must be retained by the warehouse subject to the terms of the receipt and this article.
(d) A warehouse may buy at any public sale held pursuant to this section.
(e) A purchaser in good faith of goods sold to enforce a warehouse's lien takes the goods free of any rights of persons against which the lien was valid, despite the warehouse's noncompliance with this section.
(f) A warehouse may satisfy its lien from the proceeds of any sale pursuant to this section but shall hold the balance, if any, for delivery on demand to any person to which the warehouse would have been bound to deliver the goods.
(g) The rights provided by this section are in addition to all other rights allowed by law to a creditor against a debtor.
(h) If a lien is on goods stored by a merchant in the course of its business, the lien may be enforced in accordance with subsection (a) or (b).
(i) A warehouse is liable for damages caused by failure to comply with the requirements for sale under this section and, in case of willful violation, is liable for conversion.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-301/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-301 - Liability for Nonreceipt or Misdescription; "Said to Contain"; "Shipper's Weight,...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-301 - Liability for Nonreceipt or Misdescription; "Said to Contain"; "Shipper's Weight, Load, and Count"; Improper Handling.
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Section 7-7-301
Liability for nonreceipt or misdescription; "said to contain"; "shipper's weight, load, and count"; improper handling.
(a) A consignee of a nonnegotiable bill of lading which has given value in good faith, or a holder to which a negotiable bill has been duly negotiated, relying upon the description of the goods in the bill or upon the date shown in the bill, may recover from the issuer damages caused by the misdating of the bill or the nonreceipt or misdescription of the goods, except to the extent that the bill indicates that the issuer does not know whether any part or all of the goods in fact were received or conform to the description, such as in a case in which the description is in terms of marks or labels or kind, quantity, or condition or the receipt or description is qualified by "contents or condition of contents of packages unknown," "said to contain," "shipper's weight, load, and count," or words of similar import, if that indication is true.
(b) If goods are loaded by the issuer of a bill of lading;
(1) The issuer shall count the packages of goods if shipped in packages and ascertain the kind and quantity if shipped in bulk; and
(2) Words such as "shipper's weight, load, and count," or words of similar import indicating that the description was made by the shipper are ineffective except as to goods concealed in packages.
(c) If bulk goods are loaded by a shipper that makes available to the issuer of a bill of lading adequate facilities for weighing those goods, the issuer shall ascertain the kind and quantity within a reasonable time after receiving the shipper's request in a record to do so. In that case, "shipper's weight" or words of similar import are ineffective.
(d) The issuer of a bill of lading, by including in the bill the words "shipper's weight, load, and count," or words of similar import, may indicate that the goods were loaded by the shipper, and, if that statement is true, the issuer is not liable for damages caused by the improper loading. However, omission of such words does not imply liability for damages caused by improper loading.
(e) A shipper guarantees to an issuer the accuracy at the time of shipment of the description, marks, labels, number, kind, quantity, condition, and weight, as furnished by the shipper, and the shipper shall indemnify the issuer against damage caused by inaccuracies in those particulars. This right of indemnity does not limit the issuer's responsibility or liability under the contract of carriage to any person other than the shipper.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-302/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-302 - Through Bills of Lading and Similar Documents of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-302 - Through Bills of Lading and Similar Documents of Title.
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Section 7-7-302
Through bills of lading and similar documents of title.
(a) The issuer of a through bill of lading, or other document of title embodying an undertaking to be performed in part by a person acting as its agent or by a performing carrier, is liable to any person entitled to recover on the bill or other document for any breach by the other person or the performing carrier of its obligation under the bill or other document. However, to the extent that the bill or other document covers an undertaking to be performed overseas or in territory not contiguous to the continental United States or an undertaking including matters other than transportation, this liability for breach by the other person or the performing carrier may be varied by agreement of the parties.
(b) If goods covered by a through bill of lading or other document of title embodying an undertaking to be performed in part by a person other than the issuer are received by that person, the person is subject, with respect to its own performance while the goods are in its possession, to the obligation of the issuer. The person's obligation is discharged by delivery of the goods to another person pursuant to the bill or other document and does not include liability for breach by any other person or by the issuer.
(c) The issuer of a through bill of lading or other document of title described in subsection (a) is entitled to recover from the performing carrier, or other person in possession of the goods when the breach of the obligation under the bill or other document occurred:
(1) The amount it may be required to pay to any person entitled to recover on the bill or other document for the breach, as may be evidenced by any receipt, judgment, or transcript of judgment; and
(2) The amount of any expense reasonably incurred by the issuer in defending any action commenced by any person entitled to recover on the bill or other document for the breach.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-303/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-303 - Diversion; Reconsignment; Change of Instructions.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-303 - Diversion; Reconsignment; Change of Instructions.
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Section 7-7-303
Diversion; reconsignment; change of instructions.
(a) Unless the bill of lading otherwise provides, a carrier may deliver the goods to a person or destination other than that stated in the bill or may otherwise dispose of the goods, without liability for misdelivery, on instructions from:
(1) The holder of a negotiable bill;
(2) The consignor on a nonnegotiable bill, even if the consignee has given contrary instructions;
(3) The consignee on a nonnegotiable bill in the absence of contrary instructions from the consignor, if the goods have arrived at the billed destination or if the consignee is in possession of the tangible bill or in control of the electronic bill; or
(4) The consignee on a nonnegotiable bill, if the consignee is entitled as against the consignor to dispose of the goods.
(b) Unless instructions described in subsection (a) are included in a negotiable bill of lading, a person to which the bill is duly negotiated may hold the bailee according to the original terms.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-304/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-304 - Tangible Bills of Lading in a Set.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-304 - Tangible Bills of Lading in a Set.
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Section 7-7-304
Tangible bills of lading in a set.
(a) Except as customary in international transportation, a tangible bill of lading may not be issued in a set of parts. The issuer is liable for damages caused by violation of this subsection.
(b) If a tangible bill of lading is lawfully issued in a set of parts, each of which contains an identification code and is expressed to be valid only if the goods have not been delivered against any other part, the whole of the parts constitutes one bill.
(c) If a tangible negotiable bill of lading is lawfully issued in a set of parts and different parts are negotiated to different persons, the title of the holder to which the first due negotiation is made prevails as to both the document of title and the goods even if any later holder may have received the goods from the carrier in good faith and discharged the carrier's obligation by surrendering its part.
(d) A person that negotiates or transfers a single part of a tangible bill of lading issued in a set is liable to holders of that part as if it were the whole set.
(e) The bailee shall deliver in accordance with Part 4 against the first presented part of a tangible bill of lading lawfully issued in a set. Delivery in this manner discharges the bailee's obligation on the whole bill.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-305/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-305 - Destination Bills.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-305 - Destination Bills.
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Section 7-7-305
Destination bills.
(a) Instead of issuing a bill of lading to the consignor at the place of shipment, a carrier, at the request of the consignor, may procure the bill to be issued at destination or at any other place designated in the request.
(b) Upon request of any person entitled as against a carrier to control the goods while in transit and on surrender of possession or control of any outstanding bill of lading or other receipt covering the goods, the issuer, subject to Section 7-7-105, may procure a substitute bill to be issued at any place designated in the request.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-306/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-306 - Altered Bills of Lading.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-306 - Altered Bills of Lading.
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Section 7-7-306
Altered bills of lading.
An unauthorized alteration or filling in of a blank in a bill of lading leaves the bill enforceable according to its original tenor.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-307/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-307 - Lien of Carrier.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-307 - Lien of Carrier.
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Section 7-7-307
Lien of carrier.
(a) A carrier has a lien on the goods covered by a bill of lading or on the proceeds thereof in its possession for charges after the date of the carrier's receipt of the goods for storage or transportation, including demurrage and terminal charges, and for expenses necessary for preservation of the goods incident to their transportation or reasonably incurred in their sale pursuant to law. However, against a purchaser for value of a negotiable bill of lading, a carrier's lien is limited to charges stated in the bill or the applicable tariffs or, if no charges are stated, a reasonable charge.
(b) A lien for charges and expenses under subsection (a) on goods that the carrier was required by law to receive for transportation is effective against the consignor or any person entitled to the goods unless the carrier had notice that the consignor lacked authority to subject the goods to those charges and expenses. Any other lien under subsection (a) is effective against the consignor and any person that permitted the bailor to have control or possession of the goods unless the carrier had notice that the bailor lacked authority.
(c) A carrier loses its lien on any goods that it voluntarily delivers or unjustifiably refuses to deliver.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-308/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-308 - Enforcement of Carrier's Lien.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-308 - Enforcement of Carrier's Lien.
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Section 7-7-308
Enforcement of carrier's lien.
(a) A carrier's lien on goods may be enforced by public or private sale of the goods, in bulk or in packages, at any time or place and on any terms that are commercially reasonable, after notifying all persons known to claim an interest in the goods. The notification must include a statement of the amount due, the nature of the proposed sale, and the time and place of any public sale. The fact that a better price could have been obtained by a sale at a different time or in a method different from that selected by the carrier is not of itself sufficient to establish that the sale was not made in a commercially reasonable manner. The carrier sells goods in a commercially reasonable manner if the carrier sells the goods in the usual manner in any recognized market therefor, sells at the price current in that market at the time of the sale, or otherwise sells in conformity with commercially reasonable practices among dealers in the type of goods sold. A sale of more goods than apparently necessary to be offered to ensure satisfaction of the obligation is not commercially reasonable, except in cases covered by the preceding sentence.
(b) Before any sale pursuant to this section, any person claiming a right in the goods may pay the amount necessary to satisfy the lien and the reasonable expenses incurred in complying with this section. In that event, the goods may not be sold but must be retained by the carrier, subject to the terms of the bill of lading and this article.
(c) A carrier may buy at any public sale pursuant to this section.
(d) A purchaser in good faith of goods sold to enforce a carrier's lien takes the goods free of any rights of persons against which the lien was valid, despite the carrier's noncompliance with this section.
(e) A carrier may satisfy its lien from the proceeds of any sale pursuant to this section but shall hold the balance, if any, for delivery on demand to any person to which the carrier would have been bound to deliver the goods.
(f) The rights provided by this section are in addition to all other rights allowed by law to a creditor against a debtor.
(g) A carrier's lien may be enforced pursuant to either subsection (a) or the procedure set forth in Section 7-7-210(b).
(h) A carrier is liable for damages caused by failure to comply with the requirements for sale under this section and, in case of willful violation, is liable for conversion.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-3/section-7-7-309/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 3 - Bills of Lading: Special Provisions.›Section 7-7-309 - Duty of Care; Contractual Limitation of Carrier's Liability.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 3 - Bills of Lading: Special Provisions. › Section 7-7-309 - Duty of Care; Contractual Limitation of Carrier's Liability.
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Section 7-7-309
Duty of care; contractual limitation of carrier's liability.
(a) A carrier that issues a bill of lading, whether negotiable or nonnegotiable, shall exercise the degree of care in relation to the goods which a reasonably careful person would exercise under similar circumstances. This subsection does not affect any statute, regulation, or rule of law that imposes liability upon a common carrier for damages not caused by its negligence.
(b) Damages may be limited by a term in the bill of lading or in a transportation agreement that the carrier's liability may not exceed a value stated in the bill or transportation agreement if the carrier's rates are dependent upon value and the consignor is afforded an opportunity to declare a higher value and the consignor is advised of the opportunity. However, such a limitation is not effective with respect to the carrier's liability for conversion to its own use.
(c) Reasonable provisions as to the time and manner of presenting claims and commencing actions based on the shipment may be included in a bill of lading or a transportation agreement.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-4/section-7-7-401/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 4 - Warehouse Receipts and Bills of Lading: General Obligations.›Section 7-7-401 - Irregularities in Issue of Receipt or Bill or Conduct of Issuer.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 4 - Warehouse Receipts and Bills of Lading: General Obligations. › Section 7-7-401 - Irregularities in Issue of Receipt or Bill or Conduct of Issuer.
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Section 7-7-401
Irregularities in issue of receipt or bill or conduct of issuer.
The obligations imposed by this article on an issuer apply to a document of title even if:
(1) The document does not comply with the requirements of this article or of any other statute, rule, or regulation regarding its issuance, form, or content;
(2) The issuer violated laws regulating the conduct of its business;
(3) The goods covered by the document were owned by the bailee when the document was issued; or
(4) The person issuing the document is not a warehouse but the document purports to be a warehouse receipt.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-4/section-7-7-402/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 4 - Warehouse Receipts and Bills of Lading: General Obligations.›Section 7-7-402 - Duplicate Document of Title; Overissue.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 4 - Warehouse Receipts and Bills of Lading: General Obligations. › Section 7-7-402 - Duplicate Document of Title; Overissue.
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Section 7-7-402
Duplicate document of title; overissue.
A duplicate or any other document of title purporting to cover goods already represented by an outstanding document of the same issuer does not confer any right in the goods, except as provided in the case of tangible bills of lading in a set of parts, overissue of documents for fungible goods, substitutes for lost, stolen, or destroyed documents, or substitute documents issued pursuant to Section 7-7-105. The issuer is liable for damages caused by its overissue or failure to identify a duplicate document by a conspicuous notation.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-4/section-7-7-403/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 4 - Warehouse Receipts and Bills of Lading: General Obligations.›Section 7-7-403 - Obligation of Bailee to Deliver; Excuse.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 4 - Warehouse Receipts and Bills of Lading: General Obligations. › Section 7-7-403 - Obligation of Bailee to Deliver; Excuse.
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Section 7-7-403
Obligation of bailee to deliver; excuse.
(a) A bailee shall deliver the goods to a person entitled under a document of title if the person complies with subsections (b) and (c), unless and to the extent that the bailee establishes any of the following:
(1) Delivery of the goods to a person whose receipt was rightful as against the claimant;
(2) Damage to or delay, loss, or destruction of the goods for which the bailee is not liable;
(3) Previous sale or other disposition of the goods in lawful enforcement of a lien or on a warehouse's lawful termination of storage;
(4) The exercise by a seller of its right to stop delivery pursuant to Section 7-2-705 or by a lessor of its right to stop delivery pursuant to Section 7-2A-526;
(5) A diversion, reconsignment, or other disposition pursuant to Section 7-7-303;
(6) Release, satisfaction, or any other personal defense against the claimant; or
(7) Any other lawful excuse.
(b) A person claiming goods covered by a document of title shall satisfy the bailee's lien if the bailee so requests or if the bailee is prohibited by law from delivering the goods until the charges are paid.
(c) Unless a person claiming the goods is a person against which the document of title does not confer a right under Section 7-7-503(a):
(1) The person claiming under a document shall surrender possession or control of any outstanding negotiable document covering the goods for cancellation or indication of partial deliveries; and
(2) The bailee shall cancel the document or conspicuously indicate in the document the partial delivery or the bailee is liable to any person to which the document is duly negotiated.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-4/section-7-7-404/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 4 - Warehouse Receipts and Bills of Lading: General Obligations.›Section 7-7-404 - No Liability for Good Faith Delivery Pursuant to Document of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 4 - Warehouse Receipts and Bills of Lading: General Obligations. › Section 7-7-404 - No Liability for Good Faith Delivery Pursuant to Document of Title.
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Section 7-7-404
No liability for good faith delivery pursuant to document of title.
A bailee that in good faith has received goods and delivered or otherwise disposed of the goods according to the terms of a document of title or pursuant to this article is not liable for the goods even if:
(1) The person from which the bailee received the goods did not have authority to procure the document or to dispose of the goods; or
(2) The person to which the bailee delivered the goods did not have authority to receive the goods.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-501/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-501 - Form of Negotiation and Requirements of Due Negotiation.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-501 - Form of Negotiation and Requirements of Due Negotiation.
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Section 7-7-501
Form of negotiation and requirements of due negotiation.
(a) The following rules apply to a negotiable tangible document of title:
(1) If the document's original terms run to the order of a named person, the document is negotiated by the named person's indorsement and delivery. After the named person's indorsement in blank or to bearer, any person may negotiate the document by delivery alone.
(2) If the document's original terms run to bearer, it is negotiated by delivery alone.
(3) If the document's original terms run to the order of a named person and it is delivered to the named person, the effect is the same as if the document had been negotiated.
(4) Negotiation of the document after it has been indorsed to a named person requires indorsement by the named person and delivery.
(5) A document is duly negotiated if it is negotiated in the manner stated in this subsection to a holder that purchases it in good faith, without notice of any defense against or claim to it on the part of any person, and for value, unless it is established that the negotiation is not in the regular course of business or financing or involves receiving the document in settlement or payment of a monetary obligation.
(b) The following rules apply to a negotiable electronic document of title:
(1) If the document's original terms run to the order of a named person or to bearer, the document is negotiated by delivery of the document to another person. Indorsement by the named person is not required to negotiate the document.
(2) If the document's original terms run to the order of a named person and the named person has control of the document, the effect is the same as if the document had been negotiated.
(3) A document is duly negotiated if it is negotiated in the manner stated in this subsection to a holder that purchases it in good faith, without notice of any defense against or claim to it on the part of any person, and for value, unless it is established that the negotiation is not in the regular course of business or financing or involves taking delivery of the document in settlement or payment of a monetary obligation.
(c) Indorsement of a nonnegotiable document of title neither makes it negotiable nor adds to the transferee's rights.
(d) The naming in a negotiable bill of lading of a person to be notified of the arrival of the goods does not limit the negotiability of the bill or constitute notice to a purchaser of the bill of any interest of that person in the goods.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-502/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-502 - Rights Acquired by Due Negotiation.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-502 - Rights Acquired by Due Negotiation.
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Section 7-7-502
Rights acquired by due negotiation.
(a) Subject to Sections 7-7-205 and 7-7-503, a holder to which a negotiable document of title has been duly negotiated acquires thereby:
(1) Title to the document;
(2) Title to the goods;
(3) All rights accruing under the law of agency or estoppel, including rights to goods delivered to the bailee after the document was issued; and
(4) The direct obligation of the issuer to hold or deliver the goods according to the terms of the document free of any defense or claim by the issuer except those arising under the terms of the document or under this article, but in the case of a delivery order, the bailee's obligation accrues only upon the bailee's acceptance of the delivery order and the obligation acquired by the holder is that the issuer and any indorser will procure the acceptance of the bailee.
(b) Subject to Section 7-7-503, title and rights acquired by due negotiation are not defeated by any stoppage of the goods represented by the document of title or by surrender of the goods by the bailee and are not impaired even if:
(1) The due negotiation or any prior due negotiation constituted a breach of duty;
(2) Any person has been deprived of possession of a negotiable tangible document or control of a negotiable electronic document by misrepresentation, fraud, accident, mistake, duress, loss, theft, or conversion; or
(3) A previous sale or other transfer of the goods or document has been made to a third person.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-503/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-503 - Document of Title to Goods Defeated in Certain Cases.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-503 - Document of Title to Goods Defeated in Certain Cases.
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Section 7-7-503
Document of title to goods defeated in certain cases.
(a) A document of title confers no right in goods against a person that before issuance of the document had a legal interest or a perfected security interest in the goods and that did not:
(1) Deliver or entrust the goods or any document of title covering the goods to the bailor or the bailor's nominee with:
(A) Actual or apparent authority to ship, store, or sell;
(B) Power to obtain delivery under Section 7-7-403; or
(C) Power of disposition under Section 7-2-403, 7-2A-304(2), 7-2A-305(2), 7-9A-320, or 7-9A-321(c) or other statute or rule of law; or
(2) Acquiesce in the procurement by the bailor or its nominee of any document.
(b) Title to goods based upon an unaccepted delivery order is subject to the rights of any person to which a negotiable warehouse receipt or bill of lading covering the goods has been duly negotiated. That title may be defeated under Section 7-7-504 to the same extent as the rights of the issuer or a transferee from the issuer.
(c) Title to goods based upon a bill of lading issued to a freight forwarder is subject to the rights of any person to which a bill issued by the freight forwarder is duly negotiated. However, delivery by the carrier in accordance with Part 4 pursuant to its own bill of lading discharges the carrier's obligation to deliver.
(Prior version of this section added by Acts 1965, No. 549, p. 811; amended by Act 2001-481, p. 647, §2; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-504/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-504 - Rights Acquired in Absence of Due Negotiation; Effect of Diversion; Stoppage of De...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-504 - Rights Acquired in Absence of Due Negotiation; Effect of Diversion; Stoppage of Delivery.
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Section 7-7-504
Rights acquired in absence of due negotiation; effect of diversion; stoppage of delivery.
(a) A transferee of a document of title, whether negotiable or nonnegotiable, to which the document has been delivered but not duly negotiated, acquires the title and rights that its transferor had or had actual authority to convey.
(b) In the case of a transfer of a nonnegotiable document of title, until but not after the bailee receives notice of the transfer, the rights of the transferee may be defeated:
(1) By those creditors of the transferor which could treat the transfer as void under Section 7-2-402 or 7-2A-308;
(2) By a buyer from the transferor in ordinary course of business if the bailee has delivered the goods to the buyer or received notification of the buyer's rights;
(3) By a lessee from the transferor in ordinary course of business if the bailee has delivered the goods to the lessee or received notification of the lessee's rights; or
(4) As against the bailee, by good faith dealings of the bailee with the transferor.
(c) A diversion or other change of shipping instructions by the consignor in a nonnegotiable bill of lading which causes the bailee not to deliver the goods to the consignee defeats the consignee's title to the goods if the goods have been delivered to a buyer in ordinary course of business or a lessee in ordinary course of business and, in any event, defeats the consignee's rights against the bailee.
(d) Delivery of the goods pursuant to a nonnegotiable document of title may be stopped by a seller under Section 7-2-705 or a lessor under Section 7-2A-526, subject to the requirements of due notification in those sections. A bailee that honors the seller's or lessor's instructions is entitled to be indemnified by the seller or lessor against any resulting loss or expense.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-505/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-505 - Indorser Not Guarantor for Other Parties.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-505 - Indorser Not Guarantor for Other Parties.
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Section 7-7-505
Indorser not guarantor for other parties.
The indorsement of a tangible document of title issued by a bailee does not make the indorser liable for any default by the bailee or previous indorsers.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-506/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-506 - Delivery Without Indorsement: Right to Compel Indorsement.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-506 - Delivery Without Indorsement: Right to Compel Indorsement.
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Section 7-7-506
Delivery without indorsement: right to compel indorsement.
The transferee of a negotiable tangible document of title has a specifically enforceable right to have its transferor supply any necessary indorsement, but the transfer becomes a negotiation only as of the time the indorsement is supplied.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-507/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-507 - Warranties on Negotiation or Delivery of Document of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-507 - Warranties on Negotiation or Delivery of Document of Title.
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Section 7-7-507
Warranties on negotiation or delivery of document of title.
If a person negotiates or delivers a document of title for value, otherwise than as a mere intermediary under Section 7-7-508, unless otherwise agreed, the transferor, in addition to any warranty made in selling or leasing the goods, warrants to its immediate purchaser only that:
(1) The document is genuine;
(2) The transferor does not have knowledge of any fact that would impair the document's validity or worth; and
(3) The negotiation or delivery is rightful and fully effective with respect to the title to the document and the goods it represents.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-5/section-7-7-508/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-508 - Warranties of Collecting Bank as to Documents of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-508 - Warranties of Collecting Bank as to Documents of Title.
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Section 7-7-508
Warranties of collecting bank as to documents of title.
A collecting bank or other intermediary known to be entrusted with documents of title on behalf of another or with collection of a draft or other claim against delivery of documents warrants by the delivery of the documents only its own good faith and authority even if the collecting bank or other intermediary has purchased or made advances against the claim or draft to be collected.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer.›Section 7-7-509 - Adequate Compliance With Commercial Contract.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 5 - Warehouse Receipts and Bills of Lading: Negotiation and Transfer. › Section 7-7-509 - Adequate Compliance With Commercial Contract.
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Section 7-7-509
Adequate compliance with commercial contract.
Whether a document of title is adequate to fulfill the obligations of a contract for sale, a contract for lease, or the conditions of a letter of credit is determined by Article 2, 2A, or 5.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-6/section-7-7-601/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 6 - Warehouse Receipts and Bills of Lading: Miscellaneous Provisions.›Section 7-7-601 - Lost, Stolen, or Destroyed Documents of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 6 - Warehouse Receipts and Bills of Lading: Miscellaneous Provisions. › Section 7-7-601 - Lost, Stolen, or Destroyed Documents of Title.
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Section 7-7-601
Lost, stolen, or destroyed documents of title.
(a) If a document of title is lost, stolen, or destroyed, a court may order delivery of the goods or issuance of a substitute document and the bailee may without liability to any person comply with the order. If the document was negotiable, a court may not order delivery of the goods or issuance of a substitute document without the claimant's posting security unless it finds that any person that may suffer loss as a result of nonsurrender of possession or control of the document is adequately protected against the loss. If the document was nonnegotiable, the court may require security. The court may also order payment of the bailee's reasonable costs and attorney's fees in any action under this subsection.
(b) A bailee that, without a court order, delivers goods to a person claiming under a missing negotiable document of title is liable to any person injured thereby. If the delivery is not in good faith, the bailee is liable for conversion. Delivery in good faith is not conversion if the claimant posts security with the bailee in an amount at least double the value of the goods at the time of posting to indemnify any person injured by the delivery which files a notice of claim within one year after the delivery.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-6/section-7-7-602/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 6 - Warehouse Receipts and Bills of Lading: Miscellaneous Provisions.›Section 7-7-602 - Judicial Process Against Goods Covered by Negotiable Document of Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 6 - Warehouse Receipts and Bills of Lading: Miscellaneous Provisions. › Section 7-7-602 - Judicial Process Against Goods Covered by Negotiable Document of Title.
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Section 7-7-602
Judicial process against goods covered by negotiable document of title.
Unless a document of title was originally issued upon delivery of the goods by a person that did not have power to dispose of them, a lien does not attach by virtue of any judicial process to goods in the possession of a bailee for which a negotiable document of title is outstanding unless possession or control of the document is first surrendered to the bailee or the document's negotiation is enjoined. The bailee may not be compelled to deliver the goods pursuant to process until possession or control of the document is surrendered to the bailee or to the court. A purchaser of the document for value without notice of the process or injunction takes free of the lien imposed by judicial process.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-6/section-7-7-603/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 6 - Warehouse Receipts and Bills of Lading: Miscellaneous Provisions.›Section 7-7-603 - Conflicting Claims; Interpleader.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 6 - Warehouse Receipts and Bills of Lading: Miscellaneous Provisions. › Section 7-7-603 - Conflicting Claims; Interpleader.
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Section 7-7-603
Conflicting claims; interpleader.
If more than one person claims title to or possession of the goods, the bailee is excused from delivery until the bailee has a reasonable time to ascertain the validity of the adverse claims or to commence an action for interpleader. The bailee may assert an interpleader either in defending an action for nondelivery of the goods or by original action.
(Prior version of this section added by Acts 1965, No. 549, p. 811; repealed by Act 2004-315, p. 464, §1; current section added by Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-7/section-7-7-701/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 7 - Miscellanous Provisions.›Section 7-7-701 - Effective Date.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 7 - Miscellanous Provisions. › Section 7-7-701 - Effective Date.
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Section 7-7-701
Effective date.
This article takes effect on January 1, 2005.
(Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-7/section-7-7-702/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 7 - Miscellanous Provisions.›Section 7-7-702 - Repeals.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 7 - Miscellanous Provisions. › Section 7-7-702 - Repeals.
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Section 7-7-702
Repeals.
Existing Sections 7-7-101 through 7-7-603 and Section 7-10-104, are repealed.
(Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-7/section-7-7-703/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 7 - Miscellanous Provisions.›Section 7-7-703 - Applicability.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 7 - Miscellanous Provisions. › Section 7-7-703 - Applicability.
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Section 7-7-703
Applicability.
This article applies to a document of title that is issued or a bailment that arises on or after January 1, 2005. This article does not apply to a document of title that is issued or a bailment that arises before January 1, 2005, even if the document of title or bailment would be subject to this article if the document of title had been issued or bailment had arisen on or after January 1, 2005. This article does not apply to a right of action that has accrued before January 1, 2005.
(Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-7/part-7/section-7-7-704/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title.›Part 7 - Miscellanous Provisions.›Section 7-7-704 - Savings Clause.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 7 - Warehouse Receipts, Bills of Lading and Other Documents of Title. › Part 7 - Miscellanous Provisions. › Section 7-7-704 - Savings Clause.
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Section 7-7-704
Savings clause.
A document of title issued or a bailment that arises before January 1, 2005, and the rights, obligations, and interests flowing from that document or bailment are governed by any statute or other rule amended or repealed by this article as if the amendment or repeal had not occurred and may be terminated, completed, consummated, or enforced under that statute or other rule.
(Act 2004-315, p. 464, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-1/section-7-8-101/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-101 - Short Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-101 - Short Title.
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Section 7-8-101
Short title.
This article may be cited as Uniform Commercial Code - Investment Securities.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-102 - Definitions.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-102 - Definitions.
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Section 7-8-102
Definitions.
(a) In this article:
(1) "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.
(2) "Bearer form," as applied to a certificated security, means a form in which the security is payable to the bearer of the security certificate according to its terms but not by reason of an indorsement.
(3) "Broker" means a person defined as a broker or dealer under the federal securities laws, but without excluding a bank acting in that capacity.
(4) "Certificated security" means a security that is represented by a certificate.
(5) "Clearing corporation" means:
(i) a person that is registered as a "clearing agency" under the federal securities laws;
(ii) a federal reserve bank; or
(iii) any other person that provides clearance or settlement services with respect to financial assets that would require it to register as a clearing agency under the federal securities laws but for an exclusion or exemption from the registration requirement, if its activities as a clearing corporation, including promulgation of rules, are subject to regulation by a federal or state governmental authority.
(6) "Communicate" means to:
(i) send a signed writing; or
(ii) transmit information by any mechanism agreed upon by the persons transmitting and receiving the information.
(7) "Entitlement holder" means a person identified in the records of a securities intermediary as the person having a security entitlement against the securities intermediary. If a person acquires a security entitlement by virtue of Section 7-8-501(b)(2) or (3), that person is the entitlement holder.
(8) "Entitlement order" means a notification communicated to a securities intermediary directing transfer or redemption of a financial asset to which the entitlement holder has a security entitlement.
(9) "Financial asset," except as otherwise provided in Section 7-8-103, means:
(i) a security;
(ii) an obligation of a person or a share, participation, or other interest in a person or in property or an enterprise of a person, which is, or is of a type, dealt in or traded on financial markets, or which is recognized in any area in which it is issued or dealt in as a medium for investment; or
(iii) any property that is held by a securities intermediary for another person in a securities account if the securities intermediary has expressly agreed with the other person that the property is to be treated as a financial asset under this article. As context requires, the term means either the interest itself or the means by which a person's claim to it is evidenced, including a certificated or uncertificated security, a security certificate, or a security entitlement.
(10) "Good faith," for purposes of the obligation of good faith in the performance or enforcement of contracts or duties within this article, means honesty in fact and the observance of reasonable commercial standards of fair dealing.
(11) "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.
(12) "Instruction" means a notification communicated to the issuer of an uncertificated security which directs that the transfer of the security be registered or that the security be redeemed.
(13) "Registered form," as applied to a certificated security, means a form in which:
(i) the security certificate specifies a person entitled to the security; and
(ii) a transfer of the security may be registered upon books maintained for that purpose by or on behalf of the issuer, or the security certificate so states.
(14) "Securities intermediary" means:
(i) a clearing corporation; or
(ii) a person, including a bank or broker, that in the ordinary course of its business maintains securities accounts for others and is acting in that capacity.
(15) "Security," except as otherwise provided in Section 7-8-103, 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) which 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) which 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) which:
(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.
(16) "Security certificate" means a certificate representing a security.
(17) "Security entitlement" means the rights and property interest of an entitlement holder with respect to a financial asset specified in Part 5.
(18) "Uncertificated security" means a security that is not represented by a certificate.
(b) Other definitions applying to this article and the sections in which they appear are:
"Appropriate person." Section 7-8-107
"Control." Section 7-8-106
"Delivery." Section 7-8-301
"Investment company security." Section 7-8-103
"Issuer." Section 7-8-201
"Overissue." Section 7-8-210
"Protected purchaser." Section 7-8-303
"Securities account." Section 7-8-501
(c) In addition, Article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
(d) The characterization of a person, business, or transaction for purposes of this article does not determine the characterization of the person, business, or transaction for purposes of any other law, regulation, or rule.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-1/section-7-8-103/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-103 - Rules for Determining Whether Certain Obligations and Interests Are Securities or...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-103 - Rules for Determining Whether Certain Obligations and Interests Are Securities or Financial Assets.
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Section 7-8-103
Rules for determining whether certain obligations and interests are securities or financial assets.
(a) A share or similar equity interest issued by a corporation, business trust, joint stock company, or similar entity is a security.
(b) An "investment company security" is a security. "Investment company security" means a share or similar equity interest issued by an entity that is registered as an investment company under the federal investment company laws, an interest in a unit investment trust that is so registered, or a face-amount certificate issued by a face-amount certificate company that is so registered. Investment company security does not include an insurance policy or endowment policy or annuity contract issued by an insurance company.
(c) An interest in a partnership or limited liability company is not a security unless it is dealt in or traded on securities exchanges or in securities markets, its terms expressly provide that it is a security governed by this article, or it is an investment company security. However, an interest in a partnership or limited liability company is a financial asset if it is held in a securities account.
(d) A writing that is a security certificate is governed by this article and not by Article 3, even though it also meets the requirements of that article. However, a negotiable instrument governed by Article 3 is a financial asset if it is held in a securities account.
(e) An option or similar obligation issued by a clearing corporation to its participants is not a security, but is a financial asset.
(f) A commodity contract, as defined in Section 7-9A-102(a)(15), is not a security or a financial asset.
(g) A document of title is not a financial asset unless Section 7-8-102(a)(9)(iii) applies.
(Acts 1996, No. 96-742, p. 1241, §1; Act 2001-481, p. 647, §2; Act 2004-315, p. 464, §2.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-1/section-7-8-104/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-104 - Acquisition of Security or Financial Asset or Interest Therein.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-104 - Acquisition of Security or Financial Asset or Interest Therein.
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Section 7-8-104
Acquisition of security or financial asset or interest therein.
(a) A person acquires a security or an interest therein, under this article, if:
(1) the person is a purchaser to whom a security is delivered pursuant to Section 7-8-301; or
(2) the person acquires a security entitlement to the security pursuant to Section 7-8-501.
(b) A person acquires a financial asset, other than a security, or an interest therein, under this article, if the person acquires a security entitlement to the financial asset.
(c) A person who acquires a security entitlement to a security or other financial asset has the rights specified in Part 5, but is a purchaser of any security, security entitlement, or other financial asset held by the securities intermediary only to the extent provided in Section 7-8-503.
(d) Unless the context shows that a different meaning is intended, a person who is required by other law, regulation, rule, or agreement to transfer, deliver, present, surrender, exchange, or otherwise put in the possession of another person a security or financial asset satisfies that requirement by causing the other person to acquire an interest in the security or financial asset pursuant to subsection (a) or (b).
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-105 - Notice of Adverse Claim.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-105 - Notice of Adverse Claim.
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Section 7-8-105
Notice of adverse claim.
(a) A person has notice of an adverse claim if:
(1) the person knows of the adverse claim;
(2) the person is aware of facts sufficient to indicate that there is a significant probability that the adverse claim exists and deliberately avoids information that would establish the existence of the adverse claim; or
(3) the person has a duty, imposed by statute or regulation, to investigate whether an adverse claim exists, and the investigation so required would establish the existence of the adverse claim.
(b) Having knowledge that a financial asset or interest therein is or has been transferred by a representative imposes no duty of inquiry into the rightfulness of a transaction and is not notice of an adverse claim. However, a person who knows that a representative has transferred a financial asset or interest therein in a transaction that is, or whose proceeds are being used, for the individual benefit of the representative or otherwise in breach of duty has notice of an adverse claim.
(c) An act or event that creates a right to immediate performance of the principal obligation represented by a security certificate or sets a date on or after which the certificate is to be presented or surrendered for redemption or exchange does not itself constitute notice of an adverse claim except in the case of a transfer more than:
(1) one year after a date set for presentment or surrender for redemption or exchange; or
(2) six months after a date set for payment of money against presentation or surrender of the certificate, if money was available for payment on that date.
(d) A purchaser of a certificated security has notice of an adverse claim if the security certificate:
(1) whether in bearer or registered form, has been indorsed "for collection" or "for surrender" or for some other purpose not involving transfer; or
(2) is in bearer form and has on it an unambiguous statement that it is the property of a person other than the transferor, but the mere writing of a name on the certificate is not such a statement.
(e) Filing of a financing statement under Article 9 is not notice of an adverse claim to a financial asset.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-106 - Control.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-106 - Control.
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Section 7-8-106
Control.
(a) A purchaser has "control" of a certificated security in bearer form if the certificated security is delivered to the purchaser.
(b) A purchaser has "control" of a certificated security in registered form if the certificated security is delivered to the purchaser, and:
(1) the certificate is indorsed to the purchaser or in blank by an effective indorsement; or
(2) the certificate is registered in the name of the purchaser, upon original issue or registration of transfer by the issuer.
(c) A purchaser has "control" of an uncertificated security if:
(1) the uncertificated security is delivered to the purchaser; or
(2) the issuer has agreed that it will comply with instructions originated by the purchaser without further consent by the registered owner.
(d) A purchaser has "control" of a security entitlement if:
(1) the purchaser becomes the entitlement holder;
(2) the securities intermediary has agreed that it will comply with entitlement orders originated by the purchaser without further consent by the entitlement holder; or
(3) another person has control of the security entitlement on behalf of the purchaser or, having previously acquired control of the security entitlement, acknowledges that it has control on behalf of the purchaser.
(e) If an interest in a security entitlement is granted by the entitlement holder to the entitlement holder's own securities intermediary, the securities intermediary has control.
(f) A purchaser who has satisfied the requirements of subsection (c) or (d) has control, even if the registered owner in the case of subsection (c) or the entitlement holder in the case of subsection (d) retains the right to make substitutions for the uncertificated security or security entitlement, to originate instructions or entitlement orders to the issuer or securities intermediary, or otherwise to deal with the uncertificated security or security entitlement.
(g) An issuer or a securities intermediary may not enter into an agreement of the kind described in subsection (c)(2) or (d)(2) without the consent of the registered owner or entitlement holder, but an issuer or a securities intermediary is not required to enter into such an agreement even though the registered owner or entitlement holder so directs. An issuer or securities intermediary that has entered into such an agreement is not required to confirm the existence of the agreement to another party unless requested to do so by the registered owner or entitlement holder.
(Acts 1996, No. 96-742, p. 1241, §1; Act 2001-481, p. 647, §2.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-107 - Whether Indorsement, Instruction, or Entitlement Order Is Effective.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-107 - Whether Indorsement, Instruction, or Entitlement Order Is Effective.
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Section 7-8-107
Whether indorsement, instruction, or entitlement order is effective.
(a) "Appropriate person" means:
(1) with respect to an indorsement, the person specified by a security certificate or by an effective special indorsement to be entitled to the security;
(2) with respect to an instruction, the registered owner of an uncertificated security;
(3) with respect to an entitlement order, the entitlement holder;
(4) if the person designated in paragraph (1), (2), or (3) 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
(5) if the person designated in paragraph (1), (2), or (3) 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.
(b) An indorsement, instruction, or entitlement order is effective if:
(1) it is made by the appropriate person;
(2) 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 Section 7-8-106(c)(2) or (d)(2); or
(3) the appropriate person has ratified it or is otherwise precluded from asserting its ineffectiveness.
(c) An indorsement, instruction, or entitlement order made by a representative is effective even if:
(1) 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
(2) the representative's action in making the indorsement, instruction, or entitlement order or using the proceeds of the transaction is otherwise a breach of duty.
(d) If a security is registered in the name of or specially indorsed 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 indorsement, instruction, or entitlement order made by the person is effective even though the person is no longer serving in the described capacity.
(e) Effectiveness of an indorsement, instruction, or entitlement order is determined as of the date the indorsement, instruction, or entitlement order is made, and an indorsement, instruction, or entitlement order does not become ineffective by reason of any later change of circumstances.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-108 - Warranties in Direct Holding.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-108 - Warranties in Direct Holding.
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Section 7-8-108
Warranties in direct holding.
(a) 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:
(1) the certificate is genuine and has not been materially altered;
(2) the transferor or indorser does not know of any fact that might impair the validity of the security;
(3) there is no adverse claim to the security;
(4) the transfer does not violate any restriction on transfer;
(5) 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
(6) the transfer is otherwise effective and rightful.
(b) A person who originates an instruction for registration of transfer of an uncertificated security to a purchaser for value warrants to the purchaser that:
(1) 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;
(2) the security is valid;
(3) there is no adverse claim to the security; and
(4) 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.
(c) 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:
(1) the uncertificated security is valid;
(2) there is no adverse claim to the security;
(3) the transfer does not violate any restriction on transfer; and
(4) the transfer is otherwise effective and rightful.
(d) A person who indorses a security certificate warrants to the issuer that:
(1) there is no adverse claim to the security; and
(2) the indorsement is effective.
(e) A person who originates an instruction for registration of transfer of an uncertificated security warrants to the issuer that:
(1) the instruction is effective; and
(2) at the time the instruction is presented to the issuer the purchaser will be entitled to the registration of transfer.
(f) 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.
(g) 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.
(h) 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 (g).
(i) Except as otherwise provided in subsection (g), a broker acting for a customer makes to the issuer and a purchaser the warranties provided in subsections (a) through (f). 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 (a) or (b), 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.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-109 - Warranties in Indirect Holding.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-109 - Warranties in Indirect Holding.
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Section 7-8-109
Warranties in indirect holding.
(a) A person who originates an entitlement order to a securities intermediary warrants to the securities intermediary that:
(1) the entitlement order is made by an appropriate person, or if the entitlement order is by an agent, the agent has actual authority to act on behalf of the appropriate person; and
(2) there is no adverse claim to the security entitlement.
(b) A person who delivers a security certificate to a securities intermediary for credit to a securities account or originates an instruction with respect to an uncertificated security directing that the uncertificated security be credited to a securities account makes to the securities intermediary the warranties specified in Section 7-8-108(a) or (b).
(c) If a securities intermediary delivers a security certificate to its entitlement holder or causes its entitlement holder to be registered as the owner of an uncertificated security, the securities intermediary makes to the entitlement holder the warranties specified in Section 7-8-108(a) or (b).
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-110 - Applicability; Choice of Law.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-110 - Applicability; Choice of Law.
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Section 7-8-110
Applicability; choice of law.
(a) The local law of the issuer's jurisdiction, as specified in subsection (d), governs:
(1) the validity of a security;
(2) the rights and duties of the issuer with respect to registration of transfer;
(3) the effectiveness of registration of transfer by the issuer;
(4) whether the issuer owes any duties to an adverse claimant to a security; and
(5) whether an adverse claim can be asserted against a person to whom transfer of a certificated or uncertificated security is registered or a person who obtains control of an uncertificated security.
(b) The local law of the securities intermediary's jurisdiction, as specified in subsection (e), governs:
(1) acquisition of a security entitlement from the securities intermediary;
(2) the rights and duties of the securities intermediary and entitlement holder arising out of a security entitlement;
(3) whether the securities intermediary owes any duties to an adverse claimant to a security entitlement; and
(4) whether an adverse claim can be asserted against a person who acquires a security entitlement from the securities intermediary or a person who purchases a security entitlement or interest therein from an entitlement holder.
(c) The local law of the jurisdiction in which a security certificate is located at the time of delivery governs whether an adverse claim can be asserted against a person to whom the security certificate is delivered.
(d) "Issuer's jurisdiction" means the jurisdiction under which the issuer of the security is organized or, if permitted by the law of that jurisdiction, the law of another jurisdiction specified by the issuer. An issuer organized under the law of this state may specify the law of another jurisdiction as the law governing the matters specified in subsection (a)(2) through (5).
(e) The following rules determine a "securities intermediary's jurisdiction" for purposes of this section:
(1) If an agreement between the securities intermediary and its entitlement holder governing the securities account expressly provides that a particular jurisdiction is the securities intermediary's jurisdiction for purposes of this part, this article, or this title, that jurisdiction is the securities intermediary's jurisdiction.
(2) If paragraph (1) does not apply and an agreement between the securities intermediary and its entitlement holder governing the securities account expressly provides that the agreement is governed by the law of a particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.
(3) If neither paragraph (1) nor paragraph (2) applies and an agreement between the securities intermediary and its entitlement holder governing the securities account expressly provides that the securities account is maintained at an office in a particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.
(4) If none of the preceding paragraphs applies, the securities intermediary's jurisdiction is the jurisdiction in which the office identified in an account statement as the office serving the entitlement holder's account is located.
(5) If none of the preceding paragraphs applies, the securities intermediary's jurisdiction is the jurisdiction in which the chief executive office of the securities intermediary is located.
(f) A securities intermediary's jurisdiction is not determined by the physical location of certificates representing financial assets, or by the jurisdiction in which is organized the issuer of the financial asset with respect to which an entitlement holder has a security entitlement, or by the location of facilities for data processing or other record keeping concerning the account.
(Acts 1996, No. 96-742, p. 1241, §1; Act 2001-481, p. 647, §2.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-111 - Clearing Corporation Rules.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-111 - Clearing Corporation Rules.
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Section 7-8-111
Clearing corporation rules.
A rule adopted by a clearing corporation governing rights and obligations among the clearing corporation and its participants in the clearing corporation is effective even if the rule conflicts with this title and affects another party who does not consent to the rule.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-112 - Creditor's Legal Process.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-112 - Creditor's Legal Process.
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Section 7-8-112
Creditor's legal process.
(a) The interest of a debtor in a certificated security may be reached by a creditor only by actual seizure of the security certificate by the officer making the attachment or levy, except as otherwise provided in subsection (d). However, a certificated security for which the certificate has been surrendered to the issuer may be reached by a creditor by legal process upon the issuer.
(b) The interest of a debtor in an uncertificated security may be reached by a creditor only by legal process upon the issuer at its chief executive office in the United States, except as otherwise provided in subsection (d).
(c) The interest of a debtor in a security entitlement may be reached by a creditor only by legal process upon the securities intermediary with whom the debtor's securities account is maintained, except as otherwise provided in subsection (d).
(d) The interest of a debtor in a certificated security for which the certificate is in the possession of a secured party, or in an uncertificated security registered in the name of a secured party, or a security entitlement maintained in the name of a secured party, may be reached by a creditor by legal process upon the secured party.
(e) A creditor whose debtor is the owner of a certificated security, uncertificated security, or security entitlement is entitled to aid from a court of competent jurisdiction, by injunction or otherwise, in reaching the certificated security, uncertificated security, or security entitlement or in satisfying the claim by means allowed at law or in equity in regard to property that cannot readily be reached by other legal process.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-113 - Statute of Frauds Inapplicable.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-113 - Statute of Frauds Inapplicable.
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Section 7-8-113
Statute of frauds inapplicable.
A contract or modification of a contract for the sale or purchase of a security is enforceable whether or not there is a writing signed or record authenticated by a party against whom enforcement is sought, even if the contract or modification is not capable of performance within one year of its making.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-1/section-7-8-114/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-114 - Evidentiary Rules Concerning Certificated Securities.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-114 - Evidentiary Rules Concerning Certificated Securities.
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Section 7-8-114
Evidentiary rules concerning certificated securities.
The following rules apply in an action on a certificated security against the issuer:
(1) Unless specifically denied in the pleadings, each signature on a security certificate or in a necessary indorsement is admitted.
(2) If the effectiveness of a signature is put in issue, the burden of establishing effectiveness is on the party claiming under the signature, but the signature is presumed to be genuine or authorized.
(3) If signatures on a security certificate are admitted or established, production of the certificate entitles a holder to recover on it unless the defendant establishes a defense or a defect going to the validity of the security.
(4) If it is shown that a defense or defect exists, the plaintiff has the burden of establishing that the plaintiff or some person under whom the plaintiff claims is a person against whom the defense or defect cannot be asserted.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-115 - Securities Intermediary and Others Not Liable to Adverse Claimant.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-115 - Securities Intermediary and Others Not Liable to Adverse Claimant.
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Section 7-8-115
Securities intermediary and others not liable to adverse claimant.
A securities intermediary that has transferred a financial asset pursuant to an effective entitlement order, or a broker or other agent or bailee that has dealt with a financial asset at the direction of its customer or principal, is not liable to a person having an adverse claim to the financial asset, unless the securities intermediary, or broker or other agent or bailee:
(1) took the action after it had been served with an injunction, restraining order, or other legal process enjoining it from doing so, issued by a court of competent jurisdiction, and had a reasonable opportunity to act on the injunction, restraining order, or other legal process; or
(2) acted in collusion with the wrongdoer in violating the rights of the adverse claimant; or
(3) in the case of a security certificate that has been stolen, acted with notice of the adverse claim.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 1 - Short Title and General Matters.›Section 7-8-116 - Securities Intermediary as Purchaser for Value.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 1 - Short Title and General Matters. › Section 7-8-116 - Securities Intermediary as Purchaser for Value.
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Section 7-8-116
Securities intermediary as purchaser for value.
A securities intermediary that receives a financial asset and establishes a security entitlement to the financial asset in favor of an entitlement holder is a purchaser for value of the financial asset. A securities intermediary that acquires a security entitlement to a financial asset from another securities intermediary acquires the security entitlement for value if the securities intermediary acquiring the security entitlement establishes a security entitlement to the financial asset in favor of an entitlement holder.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-2/section-7-8-201/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-201 - Issuer.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-201 - Issuer.
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Section 7-8-201
Issuer.
(a) With respect to an obligation on or a defense to a security, an "issuer" includes a person that:
(1) places or authorizes the placing of its name on a security certificate, other than as authenticating trustee, registrar, transfer agent, or the like, to evidence a share, participation, or other interest in its property or in an enterprise, or to evidence its duty to perform an obligation represented by the certificate;
(2) creates a share, participation, or other interest in its property or in an enterprise, or undertakes an obligation, that is an uncertificated security;
(3) directly or indirectly creates a fractional interest in its rights or property, if the fractional interest is represented by a security certificate; or
(4) becomes responsible for, or in place of, another person described as an issuer in this section.
(b) With respect to an obligation on or defense to a security, a guarantor is an issuer to the extent of its guaranty, whether or not its obligation is noted on a security certificate.
(c) With respect to a registration of a transfer, issuer means a person on whose behalf transfer books are maintained.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-202 - Issuer's Responsibility and Defenses; Notice of Defect or Defense.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-202 - Issuer's Responsibility and Defenses; Notice of Defect or Defense.
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Section 7-8-202
Issuer's responsibility and defenses; notice of defect or defense.
(a) Even against a purchaser for value and without notice, the terms of a certificated security include terms stated on the certificate and terms made part of the security by reference on the certificate to another instrument, indenture, or document or to a constitution, statute, ordinance, rule, regulation, order, or the like, to the extent the terms referred to do not conflict with terms stated on the certificate. A reference under this subsection does not of itself charge a purchaser for value with notice of a defect going to the validity of the security, even if the certificate expressly states that a person accepting it admits notice. The terms of an uncertificated security include those stated in any instrument, indenture, or document or in a constitution, statute, ordinance, rule, regulation, order, or the like, pursuant to which the security is issued.
(b) The following rules apply if an issuer asserts that a security is not valid:
(1) A security other than one issued by a government or governmental subdivision, agency, or instrumentality, even though issued with a defect going to its validity, is valid in the hands of a purchaser for value and without notice of the particular defect unless the defect involves a violation of a constitutional provision. In that case, the security is valid in the hands of a purchaser for value and without notice of the defect, other than one who takes by original issue.
(2) Paragraph (1) applies to an issuer that is a government or governmental subdivision, agency, or instrumentality only if there has been substantial compliance with the legal requirements governing the issue or the issuer has received a substantial consideration for the issue as a whole or for the particular security and a stated purpose of the issue is one for which the issuer has power to borrow money or issue the security.
(c) Except as otherwise provided in Section 7-8-205, lack of genuineness of a certificated security is a complete defense, even against a purchaser for value and without notice.
(d) All other defenses of the issuer of a security, including nondelivery and conditional delivery of a certificated security, are ineffective against a purchaser for value who has taken the certificated security without notice of the particular defense.
(e) This section does not affect the right of a party to cancel a contract for a security "when, as and if issued" or "when distributed" in the event of a material change in the character of the security that is the subject of the contract or in the plan or arrangement pursuant to which the security is to be issued or distributed.
(f) If a security is held by a securities intermediary against whom an entitlement holder has a security entitlement with respect to the security, the issuer may not assert any defense that the issuer could not assert if the entitlement holder held the security directly.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-2/section-7-8-203/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-203 - Staleness as Notice of Defect or Defense.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-203 - Staleness as Notice of Defect or Defense.
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Section 7-8-203
Staleness as notice of defect or defense.
After an act or event, other than a call that has been revoked, creating a right to immediate performance of the principal obligation represented by a certificated security or setting a date on or after which the security is to be presented or surrendered for redemption or exchange, a purchaser is charged with notice of any defect in its issue or defense of the issuer, if the act or event:
(1) requires the payment of money, the delivery of a certificated security, the registration of transfer of an uncertificated security, or any of them on presentation or surrender of the security certificate, the money or security is available on the date set for payment or exchange, and the purchaser takes the security more than one year after that date; or
(2) is not covered by paragraph (1) and the purchaser takes the security more than two years after the date set for surrender or presentation or the date on which performance became due.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-2/section-7-8-204/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-204 - Effect of Issuer's Restriction on Transfer.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-204 - Effect of Issuer's Restriction on Transfer.
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Section 7-8-204
Effect of issuer's restriction on transfer.
A restriction on transfer of a security imposed by the issuer, even if otherwise lawful, is ineffective against a person without knowledge of the restriction unless:
(1) the security is certificated and the restriction is noted conspicuously on the security certificate; or
(2) the security is uncertificated and the registered owner has been notified of the restriction.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-205 - Effect of Unauthorized Signature on Security Certificate.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-205 - Effect of Unauthorized Signature on Security Certificate.
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Section 7-8-205
Effect of unauthorized signature on security certificate.
An unauthorized signature placed on a security certificate before or in the course of issue is ineffective, but the signature is effective in favor of a purchaser for value of the certificated security if the purchaser is without notice of the lack of authority and the signing has been done by:
(1) an authenticating trustee, registrar, transfer agent, or other person entrusted by the issuer with the signing of the security certificate or of similar security certificates, or the immediate preparation for signing of any of them; or
(2) an employee of the issuer, or of any of the persons listed in paragraph (1), entrusted with responsible handling of the security certificate.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-206 - Completion or Alteration of Security Certificate.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-206 - Completion or Alteration of Security Certificate.
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Section 7-8-206
Completion or alteration of security certificate.
(a) If a security certificate contains the signatures necessary to its issue or transfer but is incomplete in any other respect:
(1) any person may complete it by filling in the blanks as authorized; and
(2) even if the blanks are incorrectly filled in, the security certificate as completed is enforceable by a purchaser who took it for value and without notice of the incorrectness.
(b) A complete security certificate that has been improperly altered, even if fraudulently, remains enforceable, but only according to its original terms.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-207 - Rights and Duties of Issuer With Respect to Registered Owners.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-207 - Rights and Duties of Issuer With Respect to Registered Owners.
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Section 7-8-207
Rights and duties of issuer with respect to registered owners.
(a) Before due presentment for registration of transfer of a certificated security in registered form or of an instruction requesting registration of transfer of an uncertificated security, the issuer or indenture trustee may treat the registered owner as the person exclusively entitled to vote, receive notifications, and otherwise exercise all the rights and powers of an owner.
(b) This article does not affect the liability of the registered owner of a security for a call, assessment, or the like.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-208 - Effect of Signature of Authenticating Trustee, Registrar, or Transfer Agent.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-208 - Effect of Signature of Authenticating Trustee, Registrar, or Transfer Agent.
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Section 7-8-208
Effect of signature of authenticating trustee, registrar, or transfer agent.
(a) A person signing a security certificate as authenticating trustee, registrar, transfer agent, or the like, warrants to a purchaser for value of the certificated security, if the purchaser is without notice of a particular defect, that:
(1) the certificate is genuine;
(2) the person's own participation in the issue of the security is within the person's capacity and within the scope of the authority received by the person from the issuer; and
(3) the person has reasonable grounds to believe that the certificated security is in the form and within the amount the issuer is authorized to issue.
(b) Unless otherwise agreed, a person signing under subsection (a) does not assume responsibility for the validity of the security in other respects.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-209 - Issuer's Lien.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-209 - Issuer's Lien.
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Section 7-8-209
Issuer's lien.
A lien in favor of an issuer upon a certificated security is valid against a purchaser only if the right of the issuer to the lien is noted conspicuously on the security certificate.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 2 - Issue and Issuer.›Section 7-8-210 - Overissue.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 2 - Issue and Issuer. › Section 7-8-210 - Overissue.
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Section 7-8-210
Overissue.
(a) In this section, "overissue" means the issue of securities in excess of the amount the issuer has corporate power to issue, but an overissue does not occur if appropriate action has cured the overissue.
(b) Except as otherwise provided in subsections (c) and (d), the provisions of this article which validate a security or compel its issue or reissue do not apply to the extent that validation, issue, or reissue would result in overissue.
(c) If an identical security not constituting an overissue is reasonably available for purchase, a person entitled to issue or validation may compel the issuer to purchase the security and deliver it if certificated or register its transfer if uncertificated, against surrender of any security certificate the person holds.
(d) If a security is not reasonably available for purchase, a person entitled to issue or validation may recover from the issuer the price the person or the last purchaser for value paid for it with interest from the date of the person's demand.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 3 - Transfer of Certificated and Uncertificated Securities.›Section 7-8-301 - Delivery.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 3 - Transfer of Certificated and Uncertificated Securities. › Section 7-8-301 - Delivery.
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Section 7-8-301
Delivery.
(a) Delivery of a certificated security to a purchaser occurs when:
(1) the purchaser acquires possession of the security certificate;
(2) another person, other than a securities intermediary, either acquires possession of the security certificate on behalf of the purchaser or, having previously acquired possession of the certificate, acknowledges that it holds for the purchaser; or
(3) a securities intermediary acting on behalf of the purchaser acquires possession of the security certificate, only if the certificate is in registered form and is (i) registered in the name of the purchaser, (ii) payable to the order of the purchaser, or (iii) specially indorsed to the purchaser by an effective indorsement and has not been indorsed to the securities intermediary or in blank.
(b) Delivery of an uncertificated security to a purchaser occurs when:
(1) the issuer registers the purchaser as the registered owner, upon original issue or registration of transfer; or
(2) another person, other than a securities intermediary, either becomes the registered owner of the uncertificated security on behalf of the purchaser or, having previously become the registered owner, acknowledges that it holds for the purchaser.
(Acts 1996, No. 96-742, p. 1241, §1; Act 2001-481, p. 647, §2.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 3 - Transfer of Certificated and Uncertificated Securities.›Section 7-8-302 - Rights of Purchaser.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 3 - Transfer of Certificated and Uncertificated Securities. › Section 7-8-302 - Rights of Purchaser.
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Section 7-8-302
Rights of purchaser.
(a) Except as otherwise provided in subsections (b) and (c), a purchaser of a certificated or uncertificated security acquires all rights in the security that the transferor had or had power to transfer.
(b) A purchaser of a limited interest acquires rights only to the extent of the interest purchased.
(c) A purchaser of a certificated security who as a previous holder had notice of an adverse claim does not improve its position by taking from a protected purchaser.
(Acts 1996, No. 96-742, p. 1241, §1; Act 2001-481, p. 647, §2.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 3 - Transfer of Certificated and Uncertificated Securities.›Section 7-8-303 - Protected Purchaser.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 3 - Transfer of Certificated and Uncertificated Securities. › Section 7-8-303 - Protected Purchaser.
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Section 7-8-303
Protected purchaser.
(a) "Protected purchaser" means a purchaser of a certificated or uncertificated security, or of an interest therein, who:
(1) gives value;
(2) does not have notice of any adverse claim to the security; and
(3) obtains control of the certificated or uncertificated security.
(b) In addition to acquiring the rights of a purchaser, a protected purchaser also acquires its interest in the security free of any adverse claim.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 3 - Transfer of Certificated and Uncertificated Securities.›Section 7-8-304 - Indorsement.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 3 - Transfer of Certificated and Uncertificated Securities. › Section 7-8-304 - Indorsement.
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Section 7-8-304
Indorsement.
(a) An indorsement may be in blank or special. An indorsement in blank includes an indorsement to bearer. A special indorsement specifies to whom a security is to be transferred or who has power to transfer it. A holder may convert a blank indorsement to a special indorsement.
(b) An indorsement purporting to be only of part of a security certificate representing units intended by the issuer to be separately transferable is effective to the extent of the indorsement.
(c) An indorsement, whether special or in blank, does not constitute a transfer until delivery of the certificate on which it appears or, if the indorsement is on a separate document, until delivery of both the document and the certificate.
(d) If a security certificate in registered form has been delivered to a purchaser without a necessary indorsement, the purchaser may become a protected purchaser only when the indorsement is supplied. However, against a transferor, a transfer is complete upon delivery and the purchaser has a specifically enforceable right to have any necessary indorsement supplied.
(e) An indorsement of a security certificate in bearer form may give notice of an adverse claim to the certificate, but it does not otherwise affect a right to registration that the holder possesses.
(f) Unless otherwise agreed, a person making an indorsement assumes only the obligations provided in Section 7-8-108 and not an obligation that the security will be honored by the issuer.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 3 - Transfer of Certificated and Uncertificated Securities.›Section 7-8-305 - Instruction.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 3 - Transfer of Certificated and Uncertificated Securities. › Section 7-8-305 - Instruction.
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Section 7-8-305
Instruction.
(a) If an instruction has been originated by an appropriate person but is incomplete in any other respect, any person may complete it as authorized and the issuer may rely on it as completed, even though it has been completed incorrectly.
(b) Unless otherwise agreed, a person initiating an instruction assumes only the obligations imposed by Section 7-8-108 and not an obligation that the security will be honored by the issuer.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-3/section-7-8-306/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 3 - Transfer of Certificated and Uncertificated Securities.›Section 7-8-306 - Effect of Guaranteeing Signature, Indorsement, or Instruction.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 3 - Transfer of Certificated and Uncertificated Securities. › Section 7-8-306 - Effect of Guaranteeing Signature, Indorsement, or Instruction.
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Section 7-8-306
Effect of guaranteeing signature, indorsement, or instruction.
(a) A person who guarantees a signature of an indorser of a security certificate warrants that at the time of signing:
(1) the signature was genuine;
(2) the signer was an appropriate person to indorse, or if the signature is by an agent, the agent had actual authority to act on behalf of the appropriate person; and
(3) the signer had legal capacity to sign.
(b) A person who guarantees a signature of the originator of an instruction warrants that at the time of signing:
(1) the signature was genuine;
(2) the signer was an appropriate person to originate the instruction, or if the signature is by an agent, the agent had actual authority to act on behalf of the appropriate person, if the person specified in the instruction as the registered owner was, in fact, the registered owner, as to which fact the signature guarantor does not make a warranty; and
(3) the signer had legal capacity to sign.
(c) A person who specially guarantees the signature of an originator of an instruction makes the warranties of a signature guarantor under subsection (b) and also warrants that at the time the instruction is presented to the issuer:
(1) the person specified in the instruction as the registered owner of the uncertificated security will be the registered owner; and
(2) the transfer of the uncertificated security requested in the instruction will be registered by the issuer free from all liens, security interests, restrictions, and claims other than those specified in the instruction.
(d) A guarantor under subsections (a) and (b) or a special guarantor under subsection (c) does not otherwise warrant the rightfulness of the transfer.
(e) A person who guarantees an indorsement of a security certificate makes the warranties of a signature guarantor under subsection (a) and also warrants the rightfulness of the transfer in all respects.
(f) A person who guarantees an instruction requesting the transfer of an uncertificated security makes the warranties of a special signature guarantor under subsection (c) and also warrants the rightfulness of the transfer in all respects.
(g) An issuer may not require a special guaranty of signature, a guaranty of indorsement, or a guaranty of instruction as a condition to registration of transfer.
(h) The warranties under this section are made to a person taking or dealing with the security in reliance on the guaranty, and the guarantor is liable to the person for loss resulting from their breach. An indorser or originator of an instruction whose signature, indorsement, or instruction has been guaranteed is liable to a guarantor for any loss suffered by the guarantor as a result of breach of the warranties of the guarantor.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 3 - Transfer of Certificated and Uncertificated Securities.›Section 7-8-307 - Purchaser's Right to Requisites for Registration of Transfer.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 3 - Transfer of Certificated and Uncertificated Securities. › Section 7-8-307 - Purchaser's Right to Requisites for Registration of Transfer.
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Section 7-8-307
Purchaser's right to requisites for registration of transfer.
Unless otherwise agreed, the transferor of a security on due demand shall supply the purchaser with proof of authority to transfer or with any other requisite necessary to obtain registration of the transfer of the security, but if the transfer is not for value, a transferor need not comply unless the purchaser pays the necessary expenses. If the transferor fails within a reasonable time to comply with the demand, the purchaser may reject or rescind the transfer.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-4/section-7-8-401/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 4 - Registration.›Section 7-8-401 - Duty of Issuer to Register Transfer.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 4 - Registration. › Section 7-8-401 - Duty of Issuer to Register Transfer.
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Section 7-8-401
Duty of issuer to register transfer.
(a) If a certificated security in registered form is presented to an issuer with a request to register transfer or an instruction is presented to an issuer with a request to register transfer of an uncertificated security, the issuer shall register the transfer as requested if:
(1) under the terms of the security the person seeking registration of transfer is eligible to have the security registered in its name;
(2) the indorsement or instruction is made by the appropriate person or by an agent who has actual authority to act on behalf of the appropriate person;
(3) reasonable assurance is given that the indorsement or instruction is genuine and authorized (Section 7-8-402);
(4) any applicable law relating to the collection of taxes has been complied with;
(5) the transfer does not violate any restriction on transfer imposed by the issuer in accordance with Section 7-8-204;
(6) a demand that the issuer not register transfer has not become effective under Section 7-8-403, or the issuer has complied with Section 7-8-403(b) but no legal process or indemnity bond is obtained as provided in Section 7-8-403(d); and
(7) the transfer is in fact rightful or is to a protected purchaser.
(b) If an issuer is under a duty to register a transfer of a security, the issuer is liable to a person presenting a certificated security or an instruction for registration or to the person's principal for loss resulting from unreasonable delay in registration or failure or refusal to register the transfer.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 4 - Registration.›Section 7-8-402 - Assurance That Indorsement or Instruction Is Effective.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 4 - Registration. › Section 7-8-402 - Assurance That Indorsement or Instruction Is Effective.
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Section 7-8-402
Assurance that indorsement or instruction is effective.
(a) An issuer may require the following assurance that each necessary indorsement or each instruction is genuine and authorized:
(1) in all cases, a guaranty of the signature of the person making an indorsement or originating an instruction including, in the case of an instruction, reasonable assurance of identity;
(2) if the indorsement is made or the instruction is originated by an agent, appropriate assurance of actual authority to sign;
(3) if the indorsement is made or the instruction is originated by a fiduciary pursuant to Section 7-8-107(a)(4) or (a)(5), appropriate evidence of appointment or incumbency;
(4) if there is more than one fiduciary, reasonable assurance that all who are required to sign have done so; and
(5) if the indorsement is made or the instruction is originated by a person not covered by another provision of this subsection, assurance appropriate to the case corresponding as nearly as may be to the provisions of this subsection.
(b) An issuer may elect to require reasonable assurance beyond that specified in this section.
(c) In this section:
(1) "Guaranty of the signature" means a guaranty signed by or on behalf of a person reasonably believed by the issuer to be responsible. An issuer may adopt standards with respect to responsibility if they are not manifestly unreasonable.
(2) "Appropriate evidence of appointment or incumbency" means:
(i) in the case of a fiduciary appointed or qualified by a court, a certificate issued by or under the direction or supervision of the court or an officer thereof and dated within 60 days before the date of presentation for transfer; or
(ii) in any other case, a copy of a document showing the appointment or a certificate issued by or on behalf of a person reasonably believed by an issuer to be responsible or, in the absence of that document or certificate, other evidence the issuer reasonably considers appropriate.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 4 - Registration.›Section 7-8-403 - Demand That Issuer Not Register Transfer.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 4 - Registration. › Section 7-8-403 - Demand That Issuer Not Register Transfer.
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Section 7-8-403
Demand that issuer not register transfer.
(a) A person who is an appropriate person to make an indorsement or originate an instruction may demand that the issuer not register transfer of a security by communicating to the issuer a notification that identifies the registered owner and the issue of which the security is a part and provides an address for communications directed to the person making the demand. The demand is effective only if it is received by the issuer at a time and in a manner affording the issuer reasonable opportunity to act on it.
(b) If a certificated security in registered form is presented to an issuer with a request to register transfer or an instruction is presented to an issuer with a request to register transfer of an uncertificated security after a demand that the issuer not register transfer has become effective, the issuer shall promptly communicate to (i) the person who initiated the demand at the address provided in the demand and (ii) the person who presented the security for registration of transfer or initiated the instruction requesting registration of transfer a notification stating that:
(1) the certificated security has been presented for registration of transfer or the instruction for registration of transfer of the uncertificated security has been received;
(2) a demand that the issuer not register transfer had previously been received; and
(3) the issuer will withhold registration of transfer for a period of time stated in the notification in order to provide the person who initiated the demand an opportunity to obtain legal process or an indemnity bond.
(c) The period described in subsection (b)(3) may not exceed 30 days after the date of communication of the notification. A shorter period may be specified by the issuer if it is not manifestly unreasonable.
(d) An issuer is not liable to a person who initiated a demand that the issuer not register transfer for any loss the person suffers as a result of registration of a transfer pursuant to an effective indorsement or instruction if the person who initiated the demand does not, within the time stated in the issuer's communication, either:
(1) obtain an appropriate restraining order, injunction, or other process from a court of competent jurisdiction enjoining the issuer from registering the transfer; or
(2) file with the issuer an indemnity bond, sufficient in the issuer's judgment to protect the issuer and any transfer agent, registrar, or other agent of the issuer involved from any loss it or they may suffer by refusing to register the transfer.
(e) This section does not relieve an issuer from liability for registering transfer pursuant to an indorsement or instruction that was not effective.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-4/section-7-8-404/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 4 - Registration.›Section 7-8-404 - Wrongful Registration.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 4 - Registration. › Section 7-8-404 - Wrongful Registration.
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Section 7-8-404
Wrongful registration.
(a) Except as otherwise provided in Section 7-8-406, an issuer is liable for wrongful registration of transfer if the issuer has registered a transfer of a security to a person not entitled to it, and the transfer was registered:
(1) pursuant to an ineffective indorsement or instruction;
(2) after a demand that the issuer not register transfer became effective under Section 7-8-403(a) and the issuer did not comply with Section 7-8-403(b);
(3) after the issuer had been served with an injunction, restraining order, or other legal process enjoining it from registering the transfer, issued by a court of competent jurisdiction, and the issuer had a reasonable opportunity to act on the injunction, restraining order, or other legal process; or
(4) by an issuer acting in collusion with the wrongdoer.
(b) An issuer that is liable for wrongful registration of transfer under subsection (a) on demand shall provide the person entitled to the security with a like certificated or uncertificated security, and any payments or distributions that the person did not receive as a result of the wrongful registration. If an overissue would result, the issuer's liability to provide the person with a like security is governed by Section 7-8-210.
(c) Except as otherwise provided in subsection (a) or in a law relating to the collection of taxes, an issuer is not liable to an owner or other person suffering loss as a result of the registration of a transfer of a security if registration was made pursuant to an effective indorsement or instruction.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 4 - Registration.›Section 7-8-405 - Replacement of Lost, Destroyed, or Wrongfully Taken Security Certificate.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 4 - Registration. › Section 7-8-405 - Replacement of Lost, Destroyed, or Wrongfully Taken Security Certificate.
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Section 7-8-405
Replacement of lost, destroyed, or wrongfully taken security certificate.
(a) If an owner of a certificated security, whether in registered or bearer form, claims that the certificate has been lost, destroyed, or wrongfully taken, the issuer shall issue a new certificate if the owner:
(1) so requests before the issuer has notice that the certificate has been acquired by a protected purchaser;
(2) files with the issuer a sufficient indemnity bond; and
(3) satisfies other reasonable requirements imposed by the issuer.
(b) If, after the issue of a new security certificate, a protected purchaser of the original certificate presents it for registration of transfer, the issuer shall register the transfer unless an overissue would result. In that case, the issuer's liability is governed by Section 7-8-210. In addition to any rights on the indemnity bond, an issuer may recover the new certificate from a person to whom it was issued or any person taking under that person, except a protected purchaser.
(Acts 1965, No. 549, p. 811; repealed by Acts 1996, No. 96-742, p. 1241, §1; added by Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-4/section-7-8-406/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 4 - Registration.›Section 7-8-406 - Obligation to Notify Issuer of Lost, Destroyed, or Wrongfully Taken Security Certi...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 4 - Registration. › Section 7-8-406 - Obligation to Notify Issuer of Lost, Destroyed, or Wrongfully Taken Security Certificate.
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Section 7-8-406
Obligation to notify issuer of lost, destroyed, or wrongfully taken security certificate.
If a security certificate has been lost, apparently destroyed, or wrongfully taken, and the owner fails to notify the issuer of that fact within a reasonable time after the owner has notice of it and the issuer registers a transfer of the security before receiving notification, the owner may not assert against the issuer a claim for registering the transfer under Section 7-8-404 or a claim to a new security certificate under Section 7-8-405.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-4/section-7-8-407/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 4 - Registration.›Section 7-8-407 - Authenticating Trustee, Transfer Agent, and Registrar.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 4 - Registration. › Section 7-8-407 - Authenticating Trustee, Transfer Agent, and Registrar.
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Section 7-8-407
Authenticating trustee, transfer agent, and registrar.
A person acting as authenticating trustee, transfer agent, registrar, or other agent for an issuer in the registration of a transfer of its securities, in the issue of new security certificates or uncertificated securities, or in the cancellation of surrendered security certificates has the same obligation to the holder or owner of a certificated or uncertificated security with regard to the particular functions performed as the issuer has in regard to those functions.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-501 - Securities Account; Acquisition of Security Entitlement From Securities Intermedia...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-501 - Securities Account; Acquisition of Security Entitlement From Securities Intermediary.
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Section 7-8-501
Securities account; acquisition of security entitlement from securities intermediary.
(a) "Securities account" means an account to which a financial asset is or may be credited in accordance with an agreement under which the person maintaining the account undertakes to treat the person for whom the account is maintained as entitled to exercise the rights that comprise the financial asset.
(b) Except as otherwise provided in subsections (d) and (e), a person acquires a security entitlement if a securities intermediary:
(1) indicates by book entry that a financial asset has been credited to the person's securities account;
(2) receives a financial asset from the person or acquires a financial asset for the person and, in either case, accepts it for credit to the person's securities account; or
(3) becomes obligated under other law, regulation, or rule to credit a financial asset to the person's securities account.
(c) If a condition of subsection (b) has been met, a person has a security entitlement even though the securities intermediary does not itself hold the financial asset.
(d) If a securities intermediary holds a financial asset for another person, and the financial asset is registered in the name of, payable to the order of, or specially indorsed to the other person, and has not been indorsed to the securities intermediary or in blank, the other person is treated as holding the financial asset directly rather than as having a security entitlement with respect to the financial asset.
(e) Issuance of a security is not establishment of a security entitlement.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-502 - Assertion of Adverse Claim Against Entitlement Holder.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-502 - Assertion of Adverse Claim Against Entitlement Holder.
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Section 7-8-502
Assertion of adverse claim against entitlement holder.
An action based on an adverse claim to a financial asset, whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, may not be asserted against a person who acquired a security entitlement with respect to such financial asset under Section 7-8-501 for value and without notice of the adverse claim.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-503 - Property Interest of Entitlement Holder in Financial Asset Held by Securities Inte...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-503 - Property Interest of Entitlement Holder in Financial Asset Held by Securities Intermediary.
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Section 7-8-503
Property interest of entitlement holder in financial asset held by securities intermediary.
(a) To the extent necessary for a securities intermediary to satisfy all security entitlements with respect to a particular financial asset, all interests in that financial asset held by the securities intermediary are held by the securities intermediary for the entitlement holders, are not property of the securities intermediary, and are not subject to claims of creditors of the securities intermediary, except as otherwise provided in Section 7-8-511.
(b) An entitlement holder's property interest with respect to a particular financial asset under subsection (a) is a pro rata property interest in all interests in that financial asset held by the securities intermediary, without regard to the time the entitlement holder acquired the security entitlement or the time the securities intermediary acquired the interest in that financial asset.
(c) An entitlement holder's property interest with respect to a particular financial asset under subsection (a) may be enforced against the securities intermediary only by exercise of the entitlement holder's rights under Sections 7-8-505 through 7-8-508.
(d) An entitlement holder's property interest with respect to a particular financial asset under subsection (a) may be enforced against a purchaser of the financial asset or interest therein only if:
(1) insolvency proceedings have been initiated by or against the securities intermediary;
(2) the securities intermediary does not have sufficient interests in the financial asset to satisfy the security entitlements of all of its entitlement holders to that financial asset;
(3) the securities intermediary violated its obligations under Section 7-8-504 by transferring the financial asset or interest therein to the purchaser; and
(4) the purchaser is not protected under subsection (e). The trustee or other liquidator, acting on behalf of all entitlement holders having security entitlements with respect to a particular financial asset, may recover the financial asset, or interest therein, from the purchaser. If the trustee or other liquidator elects not to pursue that right, an entitlement holder whose security entitlement remains unsatisfied has the right to recover its interest in the financial asset from the purchaser.
(e) An action based on the entitlement holder's property interest with respect to a particular financial asset under subsection (a), whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, may not be asserted against any purchaser of a financial asset or interest therein who gives value, obtains control, and does not act in collusion with the securities intermediary in violating the securities intermediary's obligations under Section 7-8-504.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-504 - Duty of Securities Intermediary to Maintain Financial Asset.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-504 - Duty of Securities Intermediary to Maintain Financial Asset.
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Section 7-8-504
Duty of securities intermediary to maintain financial asset.
(a) A securities intermediary shall promptly obtain and thereafter maintain a financial asset in a quantity corresponding to the aggregate of all security entitlements it has established in favor of its entitlement holders with respect to that financial asset. The securities intermediary may maintain those financial assets directly or through one or more other securities intermediaries.
(b) Except to the extent otherwise agreed by its entitlement holder, a securities intermediary may not grant any security interests in a financial asset it is obligated to maintain pursuant to subsection (a).
(c) A securities intermediary satisfies the duty in subsection (a) if:
(1) the securities intermediary acts with respect to the duty as agreed upon by the entitlement holder and the securities intermediary; or
(2) in the absence of agreement, the securities intermediary exercises due care in accordance with reasonable commercial standards to obtain and maintain the financial asset.
(d) This section does not apply to a clearing corporation that is itself the obligor of an option or similar obligation to which its entitlement holders have security entitlements.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-505 - Duty of Securities Intermediary With Respect to Payments and Distributions.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-505 - Duty of Securities Intermediary With Respect to Payments and Distributions.
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Section 7-8-505
Duty of securities intermediary with respect to payments and distributions.
(a) A securities intermediary shall take action to obtain a payment or distribution made by the issuer of a financial asset. A securities intermediary satisfies the duty if:
(1) the securities intermediary acts with respect to the duty as agreed upon by the entitlement holder and the securities intermediary; or
(2) in the absence of agreement, the securities intermediary exercises due care in accordance with reasonable commercial standards to attempt to obtain the payment or distribution.
(b) A securities intermediary is obligated to its entitlement holder for a payment or distribution made by the issuer of a financial asset if the payment or distribution is received by the securities intermediary.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-5/section-7-8-506/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-506 - Duty of Securities Intermediary to Exercise Rights as Directed by Entitlement Hold...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-506 - Duty of Securities Intermediary to Exercise Rights as Directed by Entitlement Holder.
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Section 7-8-506
Duty of securities intermediary to exercise rights as directed by entitlement holder.
A securities intermediary shall exercise rights with respect to a financial asset if directed to do so by an entitlement holder. A securities intermediary satisfies the duty if:
(1) the securities intermediary acts with respect to the duty as agreed upon by the entitlement holder and the securities intermediary; or
(2) in the absence of agreement, the securities intermediary either places the entitlement holder in a position to exercise the rights directly or exercises due care in accordance with reasonable commercial standards to follow the direction of the entitlement holder.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-5/section-7-8-507/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-507 - Duty of Securities Intermediary to Comply With Entitlement Order.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-507 - Duty of Securities Intermediary to Comply With Entitlement Order.
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Section 7-8-507
Duty of securities intermediary to comply with entitlement order.
(a) 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:
(1) the securities intermediary acts with respect to the duty as agreed upon by the entitlement holder and the securities intermediary; or
(2) in the absence of agreement, the securities intermediary exercises due care in accordance with reasonable commercial standards to comply with the entitlement order.
(b) If a securities intermediary transfers a financial asset pursuant to an ineffective entitlement order, the securities intermediary shall reestablish 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 reestablish a security entitlement, the securities intermediary is liable to the entitlement holder for damages.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-5/section-7-8-508/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-508 - Duty of Securities Intermediary to Change Entitlement Holder's Position to Other F...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-508 - Duty of Securities Intermediary to Change Entitlement Holder's Position to Other Form of Security Holding.
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Section 7-8-508
Duty of securities intermediary to change entitlement holder's position to other form of security holding.
A securities intermediary shall act at the direction of an entitlement holder to change a security entitlement into another available form of holding for which the entitlement holder is eligible, or to cause the financial asset to be transferred to a securities account of the entitlement holder with another securities intermediary. A securities intermediary satisfies the duty if:
(1) the securities intermediary acts as agreed upon by the entitlement holder and the securities intermediary; or
(2) in the absence of agreement, the securities intermediary exercises due care in accordance with reasonable commercial standards to follow the direction of the entitlement holder.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-5/section-7-8-509/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-509 - Specification of Duties of Securities Intermediary by Other Statute or Regulation;...
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-509 - Specification of Duties of Securities Intermediary by Other Statute or Regulation; Manner of Performance of Duties of Securities Intermediary and Exercise of Rights of Entitlement Holder.
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Section 7-8-509
Specification of duties of securities intermediary by other statute or regulation; manner of performance of duties of securities intermediary and exercise of rights of entitlement holder.
(a) If the substance of a duty imposed upon a securities intermediary by Sections 7-8-504 through 7-8-508 is the subject of other statute, regulation, or rule, compliance with that statute, regulation, or rule satisfies the duty.
(b) To the extent that specific standards for the performance of the duties of a securities intermediary or the exercise of the rights of an entitlement holder are not specified by other statute, regulation, or rule or by agreement between the securities intermediary and entitlement holder, the securities intermediary shall perform its duties and the entitlement holder shall exercise its rights in a commercially reasonable manner.
(c) The obligation of a securities intermediary to perform the duties imposed by Sections 7-8-504 through 7-8-508 is subject to:
(1) rights of the securities intermediary arising out of a security interest under a security agreement with the entitlement holder or otherwise; and
(2) rights of the securities intermediary under other law, regulation, rule, or agreement to withhold performance of its duties as a result of unfulfilled obligations of the entitlement holder to the securities intermediary.
(d) Sections 7-8-504 through 7-8-508 do not require a securities intermediary to take any action that is prohibited by other statute, regulation, or rule.
(Acts 1996, No. 96-742, p. 1241, §1.)
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-510 - Rights of Purchaser of Security Entitlement From Entitlement Holder.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-510 - Rights of Purchaser of Security Entitlement From Entitlement Holder.
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Section 7-8-510
Rights of purchaser of security entitlement from entitlement holder.
(a) In a case not covered by the priority rules in Article 9A or the rules stated in subsection (c), an action based on an adverse claim to a financial asset or security entitlement, whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, may not be asserted against a person who purchases a security entitlement, or an interest therein, from an entitlement holder if the purchaser gives value, does not have notice of the adverse claim, and obtains control.
(b) If an adverse claim could not have been asserted against an entitlement holder under Section 7-8-502, the adverse claim cannot be asserted against a person who purchases a security entitlement, or an interest therein, from the entitlement holder.
(c) In a case not covered by the priority rules in Article 9A, a purchaser for value of a security entitlement, or an interest therein, who obtains control has priority over a purchaser of a security entitlement, or an interest therein, who does not obtain control. Except as otherwise provided in subsection (d), purchasers who have control rank according to priority in time of:
(1) the purchaser's becoming the person for whom the securities account, in which the security entitlement is carried, is maintained, if the purchaser obtained control under Section 7-8-106(d)(1);
(2) the securities intermediary's agreement to comply with the purchaser's entitlement orders with respect to security entitlements carried or to be carried in the securities account in which the security entitlement is carried, if the purchaser obtained control under Section 7-8-106(d)(2); or
(3) if the purchaser obtained control through another person under Section 7-8-106(d)(3), the time on which priority would be based under this subsection if the other person were the secured party.
(d) A securities intermediary as purchaser has priority over a conflicting purchaser who has control unless otherwise agreed by the securities intermediary.
(Acts 1996, No. 96-742, p. 1241, §1; Act 2001-481, p. 647, §2.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-5/section-7-8-511/
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 5 - Security Entitlements.›Section 7-8-511 - Priority Among Security Interests and Entitlement Holders.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 5 - Security Entitlements. › Section 7-8-511 - Priority Among Security Interests and Entitlement Holders.
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Section 7-8-511
Priority among security interests and entitlement holders.
(a) Except as otherwise provided in subsections (b) and (c), if a securities intermediary does not have sufficient interests in a particular financial asset to satisfy both its obligations to entitlement holders who have security entitlements to that financial asset and its obligation to a creditor of the securities intermediary who has a security interest in that financial asset, the claims of entitlement holders, other than the creditor, have priority over the claim of the creditor.
(b) A claim of a creditor of a securities intermediary who has a security interest in a financial asset held by a securities intermediary has priority over claims of the securities intermediary's entitlement holders who have security entitlements with respect to that financial asset if the creditor has control over the financial asset.
(c) If a clearing corporation does not have sufficient financial assets to satisfy both its obligations to entitlement holders who have security entitlements with respect to a financial asset and its obligation to a creditor of the clearing corporation who has a security interest in that financial asset, the claim of the creditor has priority over the claims of entitlement holders.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-6/section-7-8-601/
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AL
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 6 - Effective Date.›Section 7-8-601 - Effective Date.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 6 - Effective Date. › Section 7-8-601 - Effective Date.
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Section 7-8-601
Effective date.
This act takes effect January 1, 1996.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-6/section-7-8-602/
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AL
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 6 - Effective Date.›Section 7-8-602 - Repeals.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 6 - Effective Date. › Section 7-8-602 - Repeals.
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Section 7-8-602
Repeals.
This act repeals Sections 8-6-70 through 8-6-80, cited as the Uniform Act for Simplification of Fiduciary Security Transfers.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-8/part-6/section-7-8-603/
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AL
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 8 - Investment Securities.›Part 6 - Effective Date.›Section 7-8-603 - Savings Clause.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 8 - Investment Securities. › Part 6 - Effective Date. › Section 7-8-603 - Savings Clause.
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Section 7-8-603
Savings clause.
(a) This act does not affect an action or proceeding commenced before this act takes effect.
(b) If a security interest in a security is perfected at the date this act takes effect, and the action by which the security interest was perfected would suffice to perfect a security interest under this act, no further action is required to continue perfection. If a security interest in a security is perfected at the date this act takes effect but the action by which the security interest was perfected would not suffice to perfect a security interest under this act, the security interest remains perfected for a period of four months after the effective date and continues perfected thereafter if appropriate action to perfect under this act is taken within that period. If a security interest is perfected at the date this act takes effect and the security interest can be perfected by filing under this act, a financing statement signed by the secured party instead of the debtor may be filed within that period to continue perfection or thereafter to perfect.
(Acts 1996, No. 96-742, p. 1241, §1.)
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https://law.justia.com/codes/alabama/title-7/article-9/part-1/section-7-9-101/
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AL
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 9 - Secured Transactions; Sales of Accounts and Chattel Paper.›Part 1 - Short Title, Applicability and Definitions.›Section 7-9-101 - Short Title.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 9 - Secured Transactions; Sales of Accounts and Chattel Paper. › Part 1 - Short Title, Applicability and Definitions. › Section 7-9-101 - Short Title.
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Section 7-9-101
Short title.
Repealed by Act 2001-481, p. 647, § 4, effective January 1, 2002.
(Acts 1965, No. 549, p. 811.)
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https://law.justia.com/codes/alabama/title-7/article-9/part-1/section-7-9-102/
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AL
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 9 - Secured Transactions; Sales of Accounts and Chattel Paper.›Part 1 - Short Title, Applicability and Definitions.›Section 7-9-102 - Policy and Subject Matter of Article.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 9 - Secured Transactions; Sales of Accounts and Chattel Paper. › Part 1 - Short Title, Applicability and Definitions. › Section 7-9-102 - Policy and Subject Matter of Article.
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Section 7-9-102
Policy and subject matter of article.
Repealed by Act 2001-481, p. 647, § 4, effective January 1, 2002.
(Acts 1965, No. 549, p. 811; Acts 1981, No. 81-312, p. 399.)
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https://law.justia.com/codes/alabama/title-7/article-9/part-1/section-7-9-103/
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AL
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Justia›US Law›US Codes and Statutes›Code of Alabama›2023 Code of Alabama›Title 7 - Commercial Code.›Article 9 - Secured Transactions; Sales of Accounts and Chattel Paper.›Part 1 - Short Title, Applicability and Definitions.›Section 7-9-103 - Perfection of Security Interests in Multiple State Transactions.
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2023 Code of Alabama › Title 7 - Commercial Code. › Article 9 - Secured Transactions; Sales of Accounts and Chattel Paper. › Part 1 - Short Title, Applicability and Definitions. › Section 7-9-103 - Perfection of Security Interests in Multiple State Transactions.
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Section 7-9-103
Perfection of security interests in multiple state transactions.
Repealed by Act 2001-481, p. 647, § 4, effective January 1, 2002.
(Acts 1965, No. 549, p. 811; Acts 1981, No. 81-312, p. 399; Acts 1996, No. 96-742, p. 1241, §2; Acts 1997, No. 97-702, §2.)
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