endorsement

An endorsement (from Italian in dosso , "on the back") or issue note is a legally required written transfer note on an order paper , by means of which the rights from the order paper (in particular the ownership thereof) are transferred in whole or in part to a new beneficiary.

General

In contrast to order papers, bearer papers can be transferred informally by agreement and handover according to § 929 BGB . By law, their marketability is to be classified as high. In contrast, the legislature has set a hurdle for the transfer of order papers with the endorsement. The endorsement alone makes order papers less marketable than bearer papers. Since an order paper is for a specific and named beneficiary, a transfer regulation had to be found: It indicates in the order paper that the actual beneficiary has transferred his rights. The endorsement is required for both born and approved order papers for their transfer .

Legal issues

The endorsement is the special form of transferring rights under securities law. The types and functions of the endorsement are predominantly regulated in the Bill of Exchange Act. The bill of exchange law was selected for this because the bill of exchange is the most typical order paper. Additional provisions can also be found in the Check Act and the HGB .

The previous owner of the security issues the endorsement and is consequently called an endorser, the recipient of the security is called an endorser. An endorsement required by § 365 , para. 1 HGB in conjunction with Art. 13 , para. 1, sentence 2 WG ( Art. 16 ScheckG) of the written form and must therefore according to § 126 to be signed by hand BGB by the endorser. A special formulation of the will to transfer or the date of issue are not stipulated; in particular, the expression “order” does not need to appear.

An uninterrupted chain of endorsements, which must be traced back to the issuer of the document, legitimizes the last endorser as the authorized holder of the order paper to demand performance from the issuer or debtor of the order paper. The endorser can assert all rights from the order paper in his own name, whereby the purchase in good faith is protected ( § 365 Paragraph 1 HGB, Art. 16 Paragraph 2 WG). The material entitlement of the endorser is therefore a result of a seamless chain of endorsements, which ensures a bona fide purchase. Good faith is protected in the authority to dispose of, in the power of representation and, according to the prevailing opinion, in the authenticity of the endorsement. If the chain of endorsement is incomplete, the protection of good faith for the transfer act concerned no longer applies, as a result of which the debtor can refuse to perform. Whether the good faith in the legal capacity of the endorser is also protected is controversial, must be denied because of an intolerable contradiction in value to bearer papers.

For the registered share , which, despite its name, is one of the born order papers, Section 68 (1) sentence 2 AktG refers to the provisions of the WG and thus makes the registered share endorsable. Also § 365 para. 1 HGB refers to gekorenen order papers on the provisions of the WG.

Functions and types of endorsement

With the full endorsement all three functions are fulfilled, with the special forms of the partial endorsement some functions remain ineffective.

Full endorsement

A full endorsement has three functions:

• Transport function ( Art. 14 WG): Through the endorsement, all rights (especially ownership) from the order paper are transferred from the previous creditor (endorser) to the new owner (endorser).
• Guarantee function ( Art. 15 WG): Every endorser (in the case of a change also the issuer of the bill of exchange) is liable to every future legal owner for (accepting the bill of exchange and) paying the documented debt.
• Legitimation function ( Art. 16 WG): The owner of the order paper is deemed to be the authorized person, who can show an uninterrupted chain of endorsement on it, even if the last endorsement is a blank endorsement.

Blank endorsement

If the name of the endorser is not given, it is a blank endorsement ( Art. 13 para. 2 WG or Art. 16 para. 2 ScheckG); it consists in the mere signature of the endorser. Every holder of a blank endorsed order paper is then considered an authorized person, further endorsements are no longer required. The blank endorsement does not break the gap in the chain of endorsements. If a blank endorsement stands alone or at the end of an uninterrupted chain of endorsements, the owner is the owner ( Art. 16 Para. 2 WG). Therefore, an order paper provided with a blank endorsement can be transferred by simple agreement and handover without the need for renewed endorsement ( Art. 14 WG). The blank endorsement therefore transforms order papers into "technical" bearer papers.

Special forms

• Debt collection endorsement or procuration endorsement : The endorser is only authorized to collect the value (usually in the case of bills of exchange) (eg: "For me to the order of the xx bank for collection"). According to the bill of exchange / order check agreement, this is only permitted without restrictive additions (e.g. "value for collection"). It merely transfers ownership, ownership remains with the endorser. Therefore, the transport function is not fully realized in this form.
• Pledge endorsement : The pledgee has the right to satisfy himself on account of a claim from the order paper. In turn, it merely transfers ownership, ownership remains with the endorser. Therefore, the transport function is not fully realized in this form.
• Endorsement of fear : The endorser thus denies the following bill holders the right of recourse liability by adding the note "no liability " or "no obligation ". Therefore, the guarantee function is not realized with this form.
• With a recta endorsement , the endorser expressly excludes the endorsement from passing on the document. The addition “not to order” prohibits the endorser from transferring the order paper by means of a further endorsement. This creates a "technical" recta paper from the order paper , which can only be transferred by assignment . Therefore, the guarantee function is not realized with this form.

In the case of approved order papers, the endorsement only has the legitimation and transport function, but not a guarantee. The traditional papers ( order warehouse receipt , loading slip , bill of lading ) represent the goods securitized in them, so that their transfer by endorsement also automatically transfers ownership of the goods.

The legitimation function creates an irrefutable legal presumption, according to which the rightful owner of an order document is the owner of the document, who can prove his rights through an uninterrupted chain of endorsements.

Assertion

In order to be able to assert the claim documented in the order paper with the issuer / debtor, the paper must be handed over to the issuer / debtor. Anyone who does not own the paper cannot demand performance. The submission of a document for the purpose of asserting the performance evidenced in it is a characteristic of securities . According to Art. 40 Para. 3 Clause 2 WG, the debtor of an order paper is only obliged to check the external correctness of an endorsement chain before providing it. He therefore checks the chain of endorsements to ensure that they are complete, regardless of whether the endorsements are valid or the signatures are genuine. If the debtor pays to an unauthorized presenter of the order paper, he is released from the performance ( Section 365 (1) HGB in conjunction with Article 40 (3) WG).

See also

• Negociability

Web links

Wiktionary: Endorsement  - explanations of meanings, word origins, synonyms, translations

Wiktionary: endorse  - explanations of meanings, word origins, synonyms, translations

Individual evidence

1. ↑ Hermann Staub (founder): Commercial Code. Big comment. Volume 4: Ingo Koller u. a .: §§ 343 - 382. 4th, revised edition. de Gruyter Recht, Berlin 2004, ISBN 3-89949-174-2 , p. 145.
2. ↑ ^{a b} Veronika Schinzler: The partially paid-in registered share as a financing instrument of the insurance industry (= publications of the Institute for Insurance Science of the University of Mannheim. 62). VVW, Karlsruhe 1999, ISBN 3-88487-786-0 , p. 19, (also: Mannheim, Universität, dissertation, 1998).
3. ↑ Hermann Staub (founder): Commercial Code. Big comment. Volume 4: Ingo Koller u. a .: §§ 343 - 382. 4th, revised edition. de Gruyter Recht, Berlin 2004, ISBN 3-89949-174-2 , p. 156 ff.
4. ↑ Veronika Schinzler: The partially paid-in registered share as a financing instrument of the insurance industry (= publications of the Institute for Insurance Science of the University of Mannheim. 62). VVW, Karlsruhe 1999, ISBN 3-88487-786-0 , p. 20, (also: Mannheim, Universität, dissertation, 1998).
5. ↑ Hermann Staub (founder): Commercial Code. Big comment. Volume 4: Ingo Koller u. a .: §§ 343 - 382. 4th, revised edition. de Gruyter Recht, Berlin 2004, ISBN 3-89949-174-2 , p. 155.
6. ^ Richard Holzhammer: General commercial law and securities law. 8th, improved edition. Springer, Vienna a. a. 1998, ISBN 3-211-83156-8 , p. 307.
7. ↑ Hermann Staub (founder): Commercial Code. Big comment. Volume 4: Ingo Koller u. a .: §§ 343 - 382. 4th, revised edition. de Gruyter Recht, Berlin 2004, ISBN 3-89949-174-2 , p. 75.

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