70A-8-404 - Wrongful registration. - Utah Statutes

70A-8-404. Wrongful registration.
(1) Except as otherwise provided in Section 70A-8-406, an issuer is liable for wrongfulregistration of transfer if the issuer has registered a transfer of a security to a person not entitled toit, and the transfer was registered:
(a) pursuant to an ineffective indorsement or instruction;
(b) after a demand that the issuer not register transfer became effective under Subsection70A-8-403(1) and the issuer did not comply with Subsection 70A-8-403(2);
(c) after the issuer had been served with an injunction, restraining order, or other legalprocess enjoining it from registering the transfer, issued by a court of competent jurisdiction, andthe issuer had a reasonable opportunity to act on the injunction, restraining order, or other legalprocess; or
(d) by an issuer acting in collusion with the wrongdoer.
(2) An issuer that is liable for wrongful registration of transfer under Subsection (1) ondemand shall provide the person entitled to the security with a like certificated or uncertificatedsecurity, and any payments or distributions that the person did not receive as a result of thewrongful registration. If an overissue would result, the issuer's liability to provide the person witha like security is governed by Section 70A-8-210.
(3) Except as otherwise provided in Subsection (1) or in a law relating to the collection oftaxes, an issuer is not liable to an owner or other person suffering loss as a result of theregistration of a transfer of a security if registration was made pursuant to an effectiveindorsement or instruction.

Repealed and Re-enacted by Chapter 204, 1996 General Session