Colorado § 4-8-302 - Rights of purchaser.

§ 4-8-302. Rights of purchaser.

(a) Except as otherwise provided in subsections (b) and (c) of this section, a purchaser of a certificated or uncertificated security acquires all rights in the security that the transferor had or had power to transfer.

(b) A purchaser of a limited interest acquires rights only to the extent of the interest purchased.

(c) A purchaser of a certificated security who as a previous holder had notice of an adverse claim does not improve its position by taking from a protected purchaser.

Source: L. 96: Entire article R&RE, p. 220, § 2, effective July 1. L. 2001: (a) amended, p. 1443, § 34, effective July 1.

Editor's note: This section is similar to former §§ 4-8-301 and 4-8-302 as they existed prior to 1996.

ANNOTATION

Law reviews. For article, "One Year Review of Corporations, Partnerships, and Agency", see 34 Dicta 129 (1957).

Annotator's note. Since § 4-8-302 is similar to § 4-8-301 as it existed prior to the 1996 repeal and reenactment of this article, relevant cases construing that provision have been included in the annotations to this section.

Under this section, one acquires the rights in a security which his transferor had. Dempsey-Tegeler & Co. v. Otis Oil & Gas Corp., 293 F. Supp. 1383 (D. Colo. 1968).

In order for one to be entitled to the protection afforded by this section, he must prove that he was a purchaser for value, and that either he or his transferor was without notice of a defect in the certificates. Dempsey-Tegeler & Co. v. Otis Oil & Gas Corp., 293 F. Supp. 1383 (D. Colo. 1968).

If one's transferor was without notice of a defect in the certificates, then the defect is ineffective against the transferor by virtue of § 8-4-202(2)(a), and he has the right to require the transfer of the certificates; therefore, when such an individual purchases the certificates from his transferor he acquires his transferor's right to require the issuer to transfer the certificates. Dempsey-Tegeler & Co. v. Otis Oil & Gas Corp., 293 F. Supp. 1383 (D. Colo. 1968).

Purchaser of limited tax bond was not a "protected purchaser" acquiring rights greater than the seller held because purchaser had prior notice of another's adverse claim. Meadow Homes Dev. Corp. v. Bowens, 211 P.3d 743 (Colo. App. 2009).

For the construction of "title" under prior provisions, see Fehr v. Hadden, 134 Colo. 102, 300 P.2d 533 (1956); Arfsten v. Higby, 150 Colo. 254, 372 P.2d 166 (1962) (decided under repealed § 31-9-21, CRS 53, uniform stock transfer act).