Section 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

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.