§ 6A-8-510 - Rights of purchaser of security entitlement from entitlement holder. - Rhode Island Statutes

SECTION 6A-8-510

   § 6A-8-510  Rights of purchaser of securityentitlement from entitlement holder. – (a) In a case not covered by the priority rules in chapter 9 of this title orthe rules stated in subsection (c), an action based on an adverse claim to afinancial asset or security entitlement, whether framed in conversion,replevin, constructive trust, equitable lien, or other theory, may not beasserted against a person who purchases a security entitlement, or an interesttherein, from an entitlement holder if the purchaser gives value, does not havenotice of the adverse claim, and obtains control.

   (b) If an adverse claim could not have been asserted againstan entitlement holder under § 6A-8-502, the adverse claim cannot beasserted against a person who purchases a security entitlement, or an interesttherein, from the entitlement holder.

   (c) In a case not covered by the priority rules in chapter 9,a purchaser for value of a security entitlement, or an interest therein, whoobtains control has priority over a purchaser of a security entitlement, or aninterest therein, who does not obtain control. Except as otherwise provided insubsection (d), purchasers who have control rank according to priority in timeof:

   (1) the purchaser's becoming the person for whom thesecurities account, in which the security entitlement is carried, ismaintained, if the purchaser obtained control under § 6A-8-106(d)(1);

   (2) the securities intermediary's agreement to comply withthe purchaser's entitlement orders with respect to security entitlementscarried or to be carried in the securities account in which the securityentitlement is carried, if the purchaser obtained control under §6A-8-106(d)(2); or

   (3) if the purchaser obtained control through another personunder § 6A-8-106(d)(3), the time on which priority would be based underthis subsection if the other person were the secured party.

   (d) A securities intermediary as purchaser has priority overa conflicting purchaser who has control unless otherwise agreed by thesecurities intermediary.