Sec. 42a-3-201. Negotiation.
Sec. 42a-3-201. Negotiation. (a) "Negotiation" means a transfer of possession,
whether voluntary or involuntary, of an instrument by a person other than the issuer to
a person who thereby becomes its holder.
(b) Except for negotiation by a remitter, if an instrument is payable to an identified
person, negotiation requires transfer of possession of the instrument and its endorsement
by the holder. If an instrument is payable to bearer, it may be negotiated by transfer of
possession alone.
(1959, P.A. 133, S. 3-201; P.A. 91-304, S. 20.)
History: P.A. 91-304 entirely replaced former provisions re transfer of an instrument with provisions re negotiation of
an instrument, a restatement of Sec. 42a-3-202(1), revised to 1991.
See Sec. 42a-3-203(b) and (c) and Sec. 42a-3-204(c) for successor provisions to Sec. 42a-3-201, revised to 1991, re
transfer of an instrument and right to endorsement.
Annotations to former statute (1958 Rev., S. 39-50):
Transfer by parol and delivery gives good title. 86 C. 408. Where payee did not actually endorse, purchaser of note for
value did not become holder in due course, but acquired good title. 124 C. 180. The assignment of a mortgage held sufficient
to pass title without an endorsement of the note itself. 148 C. 466.
Title to note passed by manual delivery without endorsement where the intention was to make a gift of the note. 11 CS
228. Cited. 12 CS 1.
Annotations to present section:
Cited. 202 C. 277.
Cited. 35 CA 326.