Canada Business Corporations Act

Marginal note:Constructive delivery of a security

• 70 (1) Delivery to a purchaser occurs when

  • (a) the purchaser or a person designated by the purchaser acquires possession of a security;

  • (b) the broker of the purchaser acquires possession of a security specially endorsed to or issued in the name of the purchaser;

  • (c) the broker of the purchaser sends the purchaser confirmation of the purchase and identifies in a record a specific security as belonging to the purchaser; or

  • (d) with respect to an identified security to be delivered while still in the possession of a third person, that person acknowledges holding it for the purchaser.

• Marginal note:Constructive ownership

  (2) A purchaser is the owner of a security that a broker holds for the purchaser, but is not a holder except in the cases referred to in paragraphs (1)(b) and (c).

• Marginal note:Ownership of part of fungible bulk

  (3) If a security is part of a fungible bulk, a purchaser of the security is the owner of a proportionate interest in the fungible bulk.

• Marginal note:Notice to broker

  (4) Notice of an adverse claim received by a broker or by a purchaser after the broker takes delivery as a holder for value is not effective against the broker or the purchaser, except that, as between the broker and the purchaser, the purchaser may demand delivery of an equivalent security as to which no notice of an adverse claim has been received.