Replacement of lost, destroyed or wrongfully taken

security certificate. (a) If an owner of a certificated security, whether in registered or bearer form, claims that the certificate has been lost, destroyed or wrongfully taken, the issuer shall issue a new certificate if the owner: (1) so requests before the issuer has notice that the certificate has been acquired by a protected purchaser; (2) files with the issuer a sufficient indemnity bond; and (3) satisfies other reasonable requirements imposed by the issuer. (b) If, after the issue of a new security certificate, a protected purchaser of the original certificate presents it for registration of transfer, the issuer shall register the transfer unless an overissue would result. In that case, the issuer's liability is governed by Section 55-8-210 NMSA 1978. In addition to any rights on the indemnity bond, an issuer may recover the new certificate from a person to whom it was issued or any person taking under that person, except a protected purchaser. History: 1978 Comp., § 55-8-405, enacted by Laws 1996, ch. 47, § 42. OFFICIAL COMMENTS UCC Official Comments © by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved. 1. This section enables the owner to obtain a replacement of a lost, destroyed or stolen certificate, provided that reasonable requirements are satisfied and a sufficient indemnity bond supplied. 2. Where an "original" security certificate has reached the hands of a protected purchaser, the registered owner -- who was in the best position to prevent the loss, destruction or theft of the security certificate -- is now deprived of the new security certificate issued as a replacement. This changes the pre-UCC law under which the original certificate was ineffective after the issue of a replacement except insofar as it might represent an action for damages in the hands of a purchaser for value without notice. Keller v. Eureka Brick Mach. Mfg. Co., 43 Mo.App. 84, 11 L.R.A. 472 (1890). Where both the original and the new certificate have reached protected purchasers the issuer is required to honor both certificates unless an overissue would result and the security is not reasonably available for purchase. See Section 8-210 [55-8-210 NMSA 1978]. In the latter case alone, the protected purchaser of the original certificate is relegated to an action for damages. In either case, the issuer itself may recover on the indemnity bond. "Bearer form" Section 8-102(a)(2) [55-8-102 NMSA 1978] "Certificated security" Section 8-102(a)(4) "Issuer" Section 8-201 [55-8-201 NMSA 1978] "Notice" Section 1-201(25) [55-1-201 NMSA 1978] "Overissue" Section 8-210 [55-8-210 NMSA 1978] "Protected purchaser" Section 8-303 [55-8-303 NMSA 1978] "Registered form" Section 8-102(a)(13) "Security certificate" Section 8-102(a)(16)