Section 8--107. Whether Indorsement, Instruction, or Entitlement Order is Effective

(a) "Appropriate person" means:
         (1) with respect to an indorsement, the  person  specified  by  a
             security  certificate  or by an effective special indorsement
             to be entitled to the security;
         (2) with respect to an instruction, the registered  owner  of  an
             uncertificated security;
         (3) with respect to an entitlement order, the entitlement holder;
         (4) if  the  person  designated  in paragraph (1), (2), or (3) is
             deceased, the  designated  person's  successor  taking  under
             other  law or the designated person's personal representative
             acting for the estate of the decedent; or
         (5) if the person designated in paragraph (1), (2), or (3)  lacks
             capacity,  the  designated person's guardian, conservator, or
             other similar representative who has power under other law to
             transfer the security or financial asset.
    (b) An indorsement, instruction, or entitlement order is effective if:
         (1) it is made by the appropriate person;
         (2) it is made by a person who has power under the law of  agency
             to  transfer the security or financial asset on behalf of the
             appropriate person, including, in the case of an  instruction
             or  entitlement order, a person who has control under Section              8--106(c)(2) or (d)(2); or
         (3) the appropriate  person  has  ratified  it  or  is  otherwise
             precluded from asserting its ineffectiveness.
    (c) An  indorsement,  instruction,  or  entitlement  order  made  by a
  representative is effective even if:
         (1) the representative has failed to comply  with  a  controlling
             instrument  or  with the law of the State having jurisdiction
             of  the  representative  relationship,  including   any   law
             requiring  the representative to obtain court approval of the
             transaction; or
         (2) the  representative's  action  in  making  the   indorsement,
             instruction,  or  entitlement  order or using the proceeds of
             the transaction is otherwise a breach of duty.
    (d) If a security is registered in the name of or  specially  indorsed
  to a person described as a representative, or if a securities account is
  maintained  in  the  name  of a person described as a representative, an
  indorsement, instruction, or entitlement order made  by  the  person  is
  effective  even  though the person is no longer serving in the described
  capacity.
    (e) Effectiveness of an indorsement, instruction, or entitlement order
  is  determined  as  of  the  date  the  indorsement,   instruction,   or
  entitlement   order   is  made,  and  an  indorsement,  instruction,  or
  entitlement order does not become ineffective by  reason  of  any  later
  change of circumstances.