47-3205

47-3205. Special indorsement; blank
indorsement; anomalous indorsement

A. If an indorsement is made by the holder of an instrument, whether payable to an
identified person or payable to bearer, and the indorsement identifies a person to whom
it makes the instrument payable, it is a "special indorsement". When specially indorsed,
an instrument becomes payable to the identified person and may be negotiated only by the
indorsement of that person. The principles stated in section 47-3110 apply to special
indorsements.

B. If an indorsement is made by the holder of an instrument and it is not a special
indorsement, it is a "blank indorsement". When indorsed in blank, an instrument becomes
payable to bearer and may be negotiated by transfer of possession alone until specially
indorsed.

C. The holder may convert a blank indorsement that consists only of a signature
into a special indorsement by writing, above the signature of the indorser, words
identifying the person to whom the instrument is made payable.

D. "Anomalous indorsement" means an indorsement made by a person who is not the
holder of the instrument. An anomalous indorsement does not affect the manner in which
the instrument may be negotiated.