Printable Format84-8-303. Protected purchaser. (a) "Protected purchaser" means a purchaser of a certificated or uncertificated security, or of an interest therein, who:
(1) Gives value;
(2) does not have notice of any adverse claim to the security; and
(3) obtains control of the certificated or uncertificated security.
(b) In addition to acquiring the rights of a purchaser, a protected purchaser also acquires its interest in the security free of any adverse claim.
History: L. 1996, ch. 202, § 56; July 1.
KANSAS COMMENT, 1996
This section is derived from the former 84-8-302 and has been redrafted. The former "bona fide purchaser" has been replaced by the term "protected purchaser." The section is identical to the 1995 Official Text.
A "protected purchaser" of a security is similar in position to a holder in due course of a negotiable instrument under Article 3. See 84-3-302. The terms "value," "good faith," and "notice" are defined in 84-1-201, as modified in 84-8-116, 84-8-102(10) and 84-8-105. "Control" is defined in 84-8-106.
Protected purchaser status can be obtained by giving value without notice of adverse claims to the instrument and taking control of the instrument. For certificated securities, control is control of the security or of the person who has the security. For uncertificated securities, control is obtained by control over the issuer. A protected purchaser takes free of adverse claims to the security.
Revisor's Note:
Former section 84-8-303 was repealed by L. 1996, ch. 202, § 91 and the number reassigned to the current text.