Title 15. Fiduciaries — Subtitle 3. Maryland Uniform Act for the Simplification of Fiduciary Security Transfers

In this subtitle the following words have the meanings indicated.

“Assignment” includes any written stock power, bond power, bill of sale, deed, declaration of trust, or other instrument of transfer.

“Claims” includes a claim of any interest by a legatee of a decedent, distributee, heir, or creditor, a beneficiary under a trust, a ward, a beneficial owner of a security registered in the name of a nominee, or a minor owner of a security registered in the name of a custodian, or a claim of any similar interest, whether the claim is asserted by the claimant or by a fiduciary or by any other authorized person on behalf of the claimant, and includes a claim that the transfer would be in breach of fiduciary duties.

“Corporation” means a private or public corporation, association or trust issuing a security.

“Fiduciary” means an executor, administrator, trustee, guardian, committee, conservator, curator, tutor, custodian, or nominee.

“Person” includes an individual, a corporation, government or governmental subdivision or agency, business trust, statutory trust, estate, trust, partnership or association, two or more persons having a joint or common interest, or any other legal or commercial entity.

“Security” includes any share of stock, bond, debenture, note, or other security issued by a corporation which is registered as to ownership on the books of the corporation.

“Transfer” means a change on the books of a corporation in the registered ownership of a security.

“Transfer agent” means a person employed or authorized by a corporation to transfer securities issued by the corporation.

Is not bound to inquire into the existence, extent, or correct description of the fiduciary relationship; and

May assume without inquiry that the newly registered owner continues to be the fiduciary until the corporation or transfer agent receives written notice that the fiduciary is no longer acting as the fiduciary with respect to the particular security.

May assume without inquiry that the assignment, even though to the fiduciary or to a nominee of the fiduciary, is within the authority and capacity of the fiduciary and is not in breach of the duties of the fiduciary;

May assume without inquiry that the fiduciary has complied with any controlling instrument and with the law of the jurisdiction governing the fiduciary relationship, including any law requiring the fiduciary to obtain court approval of the transfer; and

Is not charged with notice of and is not bound to obtain or examine any court record or any recorded or unrecorded document relating to the fiduciary relationship or the assignment, even though the record or document is in its possession.

A corporation or transfer agent making a transfer pursuant to an assignment by a fiduciary who is not the registered owner shall obtain the following evidence of appointment or incumbency:

A corporation or transfer agent may adopt standards with respect to evidence of appointment or incumbency under subsection (a) of this section if the standards are not manifestly unreasonable.

Neither the corporation nor transfer agent is charged with notice of the contents of a document obtained pursuant to this section except to the extent that the contents relate directly to the appointment or incumbency.

A person who participates in the acquisition, disposition, assignment or transfer of a security by or to a fiduciary, including a person who guarantees the signature of the fiduciary, shall have the immunity from liability described under § 5-421(b) of the Courts and Judicial Proceedings Article.

If a corporation or transfer agent makes a transfer pursuant to an assignment by a fiduciary, a person who guaranteed the signature of the fiduciary shall have the immunity from liability described under § 5-421(c) of the Courts and Judicial Proceedings Article.

This section and § 5-421 of the Courts and Judicial Proceedings Article do not impose any liability upon the corporation or its transfer agent.

The rights and duties of a corporation and its transfer agents in registering a security in the name of a fiduciary or in making a transfer of a security pursuant to an assignment by a fiduciary are governed by the law of the jurisdiction under whose laws the corporation is organized.

This subtitle applies to the rights and duties of a person other than the corporation and its transfer agents with regard to acts and omissions in this State in connection with the acquisition, disposition, assignment, or transfer of a security by or to a fiduciary and of a person who guarantees in this State the signature of a fiduciary in connection with such a transaction.