(1) A securities intermediary shall comply with an entitlement order if the entitlement order is originated by the appropriate person, the securities intermediary has had reasonable opportunity to assure itself that the entitlement order is genuine and authorized, and the securities intermediary has had reasonable opportunity to comply with the entitlement order. A securities intermediary satisfies the duty if:
(a) The securities intermediary acts with respect to the duty as agreed upon by the entitlement holder and the securities intermediary; or
(b) In the absence of agreement, the securities intermediary exercises due care in accordance with reasonable commercial standards to comply with the entitlement order.
(2) If a securities intermediary transfers a financial asset pursuant to an ineffective entitlement order, the securities intermediary shall reestablish a security entitlement in favor of the person entitled to it, and pay or credit any payments or distributions that the person did not receive as a result of the wrongful transfer. If the securities intermediary does not reestablish a security entitlement, the securities intermediary is liable to the entitlement holder for damages.
History.—s. 5, ch. 98-11.
Structure Florida Statutes
Title XXXIX - Commercial Relations
Chapter 678 - Uniform Commercial Code: Investment Securities
Part V - Security Entitlements (Ss. 678.5011-678.5111)
678.5011 - Securities account; acquisition of security entitlement from securities intermediary.
678.5021 - Assertion of adverse claim against entitlement holder.
678.5041 - Duty of securities intermediary to maintain financial asset.
678.5051 - Duty of securities intermediary with respect to payments and distributions.
678.5061 - Duty of securities intermediary to exercise rights as directed by entitlement holder.
678.5071 - Duty of securities intermediary to comply with entitlement order.
678.5101 - Rights of purchaser of security entitlement from entitlement holder.
678.5111 - Priority among security interests and entitlement holders.