12A:8-505 - Duty of Securities Intermediary with Respect to Payments and Distributions - New Jersey Statutes

12A: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.

L.1997,c.252,s.1.