CHAPTER 271

DECEDENT'S ESTATES AND FIDUCIARY RELATIONS

AN ACT TO AMEND TITLE 12 OF THE DELAWARE CODE RELATING TO DECEDENTS' ESTATES AND FIDUCIARY RELATIONS.

Be it enacted by the General Assembly of the State of Delaware:

Section 1. Title 12 of the Delaware Code is amended by adding thereto in Part IV a new chapter to be designated Chapter 43, and to read as follows:

CHAPTER 43. TRANSFERS OF SECURITIES TO OR BY FIDUCIARIES

§ 4301. Definitions

In this Chapter, unless the context requires otherwise:

(e) "Assignment" includes any written stock power, bill of sale, deed, declaration of trust or other instrument of transfer.

(f) "Beneficial interest" includes the interest of a decedent's legatee, distributee, heir or creditor, of a beneficiary under a trust, of a ward, of a beneficial owner of a security registered in the name of a nominee, or of a minor owner of a security registered in the name of a custodian, or any similar interest.

(g) "Corporation" means a corporation (private, public or municipal), association or trust organized or created under the laws of this State and issuing a security subject to this Chapter, and includes the transfer agents and registrars of any of its securities.

(h) "Fiduciary" includes an executor, administrator, trustee, guardian, committee, conservator, curator, tutor, custodian or nominee.

(e) "Person" includes a firm or corporation.

(f) "Security" includes any share of stock, bond, debenture, note or other security of a corporation which is registered as to ownership on the books of the corporation.

(g) "Transfer" means a change on the books of a corporation in the registered ownership of a security.

§ 4302. Assignment to a Fiduciary

A corporation making a transfer of a security upon assignment by the registered owner to a person described as a fiduciary in the assignment or known by the corporation to be a fiduciary is not bound to inquire into the existence, extent, or correct description of the fiduciary relationship, and thereafter, until the corporation receives written notice to the contrary, it may assume without inquiry that the registered owner continues to be the fiduciary.

§ 4303. Assignment by a Fiduciary

A corporation making a transfer of a security upon assignment by a fiduciary.

(a) may assume without inquiry that the assignment, even though to the fiduciary himself or to his nominee, is within his authority and capacity and is not in breach of his fiduciary duties,

(b) may assume without inquiry that the fiduciary has complied with the laws of the state having jurisdiction of the fiduciary relationship, including any laws requiring the fiduciary to obtain court approval of the transfer, and

(c) 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, except that, if the security is not registered in the name of the fiduciary, the corporation shall obtain a copy of a document showing his appointment and, if court appointed, certified by the clerk of the appointing court within sixty days before the date of transfer, but the corporation is charged with notice of only that part of the document which provides for the appointment.

§ 4304. Adverse claims

If a person having or asserting a claim adverse to the transfer of a security from a fiduciary delivers written notice of the claim to the corporation before the transfer, the corporation shall promptly notify the claimant by registered mail of the presentation of the security for transfer. The corporation shall withhold the transfer for fifteen days after sending the notice and shall then make the transfer unless it is restrained by a court order.

§ 4305. Non-liability of Corporation

A corporation making a transfer of a security under this Chapter incurs no liability to any person.

§ 4306. Application

This Chapter applies to every claim of beneficial interest in a security issued by a corporation organized under the laws of this State regardless of the place of delivery or transfer, regardless of the location or domicile of the person asserting the claim and regardless of the location of the certificate or other instrument representing the security or of the assignment.

§ 4307. Tax obligations

This Chapter shall not be construed to affect any obligation of a corporation with respect to estate, inheritance, succession or other taxes imposed by the laws of this State.

Section 2. Short Title

This Act may be cited as the "Delaware Fiduciaries' Securities Transfer Act."

Approved July 22, 1957.