Originally from:
Advising Minnesota Corporations and Other Business Organizations - 2nd Edition - Hardcover
Advising Minnesota Corporations and Other Business Organizations - 2nd Edition - Electronic
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CHAPTER 38
ENDORSEMENTS AND RESTRICTIONS,
RIGHTS OF TRANSFEREE, AND
FRAUDULENT ENDORSEMENT
Section
§ 38.01 Endorsements and Restrictions
§ 38.02 Unauthorized Endorsement
§ 38.01 Endorsements and Restrictions
Endorsement of securities is governed by Article 8 of the Minnesota
Uniform Commercial Code.1 Article 8 requires that the security be
properly endorsed for the purchaser to be a bona fide purchaser.2 A bona
fide purchaser is defined as a purchaser for value who, in good faith and
without notice of any adverse claim, takes delivery of a certificated
security in bearer form or in registered form, issued or endorsed to him
or endorsed to him or in blank.3 A purchaser acquires the rights to the
security which the purchaser’s transferor had or had actual authority to
convey.4 However, the 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.”5
The purchaser can compel endorsement.6 An endorsement is effective
if: “(1) it is made by the appropriate person,7 (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, . . .or (3) the
appropriate person has ratified it or is otherwise precluded from asserting
its ineffectiveness.”8
An endorsement can be in blank or in special.9 An endorsement in
blank includes an endorsement to bearer.10 A special endorsement
specifies to whom the security is to be transferred, or who has the power
to transfer it.11
Roger J. Magnuson is a Partner at Dorsey and Whitney, LLP, where he serves as Head of the National Strategic Litigation Group and has practiced since 1973. He has been recognized as one of the top trial lawyers in the United States by major national and international publications, including Chambers International Guide to American Lawyers, which profiles the top 500 trial lawyers in the United States, Best Lawyers in America, Who's Who in American Law, and Who's Who in America. Mr. Magnuson was also recognized by a Journal of Law and Politics' survey for Judge's Choice "Wins Most Cases."
Some high profile cases that he has litigated include representation of the Florida Senate in the Bush v. Gore election controversy in 2000; and representation of the Plaintiffs in the widely publicized and studied Mall of America case. For several years he has represented, among other persons and entities, the Minnesota Twins and Major League Baseball principals and players in litigation; and has litigated national and local cases in federal and state court venues. He has appealed before the Supreme Court in a number of cases; as well as the Minnesota Supreme Court. He has authored several articles and 7 books.
Richard A. Saliterman is a Principal in Saliternan & Siefferman P.C., a full-service firm in Minneapolis established in 1976. Mr. Saliterman is a leading expert on corporate business matters, and is the author of several publications on business start-ups, franchises, and trademarks. Mr. Saliterman is the former National Judge Advocate for the U.S. Navy League, based in Washington D.C.
Contributing Editor:
Amanda Chang
Contributing Authors:
Alecia Anderson
Seth Back
John Baker
Shannon Berg
Constatin Burachek
Benjamin Carpenter
Ryan Check
Carl Christensen
Peter Fear
Michael Frasier
Aaron Hall
Catherine Hanson
Paul Harman
Amy Ithlan
Michael Kern
Chris Kuhlman
