Wisconsin § 403.206 - Restrictive endorsement.

§ 403.206. Restrictive endorsement.

403.206(1) (1) An endorsement limiting payment to a particular person or otherwise prohibiting further transfer or negotiation of the instrument is not effective to prevent further transfer or negotiation of the instrument. 403.206(2) (2) An endorsement stating a condition to the right of the endorsee to receive payment does not affect the right of the endorsee to enforce the instrument. A person paying the instrument or taking it for value or collection may disregard the condition, and the rights and liabilities of that person are not affected by whether the condition has been fulfilled. 403.206(3) (3) If an instrument bears an endorsement described in s. 404.201 (2) , or an endorsement in blank or to a particular bank using the words “for deposit”, “for collection”, or other words indicating a purpose of having the instrument collected by a bank for the endorser or for a particular account, the following rules apply: 403.206(3)(a) (a) A person, other than a bank, who purchases the instrument when so endorsed converts the instrument unless the amount paid for the instrument is received by the endorser or applied consistently with the endorsement. 403.206(3)(b) (b) A depositary bank that purchases the instrument or takes it for collection when so endorsed converts the instrument unless the amount paid by the bank with respect to the instrument is received by the endorser or applied consistently with the endorsement. 403.206(3)(c) (c) A payer bank that is also the depositary bank or that takes the instrument for immediate payment over the counter from a person other than a collecting bank converts the instrument unless the proceeds of the instrument are received by the endorser or applied consistently with the endorsement. 403.206(3)(d) (d) Except as otherwise provided in par. (c) , a payer bank or intermediary bank may disregard the endorsement and is not liable if the proceeds of the instrument are not received by the endorser or applied consistently with the endorsement. 403.206(4) (4) Except for an endorsement covered by sub. (3) , if an instrument bears an endorsement using words to the effect that payment is to be made to the endorsee as agent, trustee or other fiduciary for the benefit of the endorser or another person, the following rules apply: 403.206(4)(a) (a) Unless there is notice of breach of fiduciary duty as provided in s.