2014 South Carolina Code of Laws
Title 26 - Notaries Public and Acknowledgements
SECTION 26-6-160. Establishing person as having control of transferable record; rights and defenses; proof of control.

SC Code § 26-6-160 (2014) What's This?

(A) In this section, "transferable record" means an electronic record that:

(1) would be a negotiable instrument under Chapter 3 of Title 36 or a document of title under Chapter 7 of Title 36 if the electronic record were in writing; and

(2) the issuer of the electronic record expressly has agreed is a transferable record.

(B) A person has control of a transferable record if a system employed for evidencing the transfer of interests in the transferable record reliably establishes that person as the person to which the transferable record was issued or transferred.

(C) A system satisfies subsection (B), and a person is considered to have control of a transferable record, if the transferable record is created, stored, and assigned in such a manner that:

(1) there exists a single authoritative copy of the transferable record that is unique, identifiable, and, except as otherwise provided in items (4), (5), and (6), unalterable;

(2) the authoritative copy identifies the person asserting control as the person to which the transferable record was:

(a) issued; or

(b) most recently transferred, if the authoritative copy indicates that the transferable record has been transferred;

(3) the authoritative copy is communicated to and maintained by the person asserting control or its designated custodian;

(4) copies or revisions that add or change an identified assignee of the authoritative copy are made only with the consent of the person asserting control;

(5) each copy of the authoritative copy and a copy of a copy are readily identifiable as copies that are not the authoritative copy; and

(6) a revision of the authoritative copy is readily identifiable as authorized or unauthorized.

(D) Except as otherwise agreed, a person having control of a transferable record is the holder, as defined in Section 36-1-201(20), of the transferable record and has the same rights and defenses as a holder of an equivalent record or writing pursuant to Title 36, including the rights and defenses of a holder in due course, a holder to which a negotiable document of title has been duly negotiated, or a purchaser, respectively if the applicable statutory requirements pursuant to Section 36-3-302, 36-7-501, or 36-9-308 are satisfied. Delivery, possession, and endorsement are not required to obtain or exercise the rights pursuant to this subsection.

(E) Except as otherwise agreed, an obligor under a transferable record has the same rights and defenses as an equivalent obligor under equivalent records or writings pursuant to Title 36.

(F) The person seeking to enforce the transferable record shall provide, upon request, reasonable proof that he is in control of the transferable record. Proof may include access to the authoritative copy of the transferable record and related business records sufficient to review the terms of the transferable record and to establish the identity of the person having control of the transferable record.

HISTORY: 2004 Act No. 279, Section 1.

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