Code of Alabama

Ala. Code § 7-8-115 (2026)

Securities Intermediary and Others Not Liable to Adverse Claimant.

✓ official Alabama Legislature (ALISON) text, current July 2026

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A securities intermediary that has transferred a financial asset pursuant to an effective entitlement order, or a broker or other agent or bailee that has dealt with a financial asset at the direction of its customer or principal, is not liable to a person having an adverse claim to the financial asset, unless the securities intermediary, or broker or other agent or bailee:

(1) took the action after it had been served with an injunction, restraining order, or other legal process enjoining it from doing so, issued by a court of competent jurisdiction, and had a reasonable opportunity to act on the injunction, restraining order, or other legal process; or

(2) acted in collusion with the wrongdoer in violating the rights of the adverse claimant; or

(3) in the case of a security certificate that has been stolen, acted with notice of the adverse claim.

(Acts 1996, No. 96-742, p. 1241, §1.)

Notes of Decisions

Cited in 1 case, 2007–2007 · leading case: Davis v. Sterne, Agee & Leach, Inc., 965 So. 2d 1076 (Ala. 2007).

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Davis v. Sterne, Agee & Leach, Inc., 965 So. 2d 1076 (Ala. 2007). · cites it 21× “' "Ala.Code § 7-8-115 (emphasis added.) As set forth in the legislative commentary, the purpose of this statute is to *1083 enable brokers to act on the instructions of their customers without fear of liability arising from disputed claims to the financial assets maintained in…”

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