16-1616.   Transferable records.(a) In this section, "transferable record" means an electronicrecord that:

      (1)   Would be a note under article 3 of chapter 84 of the Kansas StatutesAnnotated, and amendments thereto or a document under article 7 of chapter 84of the Kansas Statutes Annotated, and amendments thereto if the electronicrecord were in writing; and

      (2)   the issuer of the electronic record expressly has agreed is atransferable record.

      (b)   A person has control of a transferable record if a system employed forevidencing the transfer of interests in the transferable record reliablyestablishes that person as the person to which the transferable record wasissued or transferred.

      (c)   A system satisfies subsection (b), and a person is deemed to have controlof a transferable record, if the transferable record is created, stored andassigned in such a manner that:

      (1)   A single authoritative copy of the transferable record exists which isunique, identifiable, and, except as otherwise provided in paragraphs (4), (5)and (6), unalterable;

      (2)   the authoritative copy identifies the person asserting control as:

      (A)   The person to which the transferable record was issued; or

      (B)   if the authoritative copy indicates that the transferable record has beentransferred, the person to which the transferable record was most recentlytransferred;

      (3)   the authoritative copy is communicated to and maintained by the personasserting control or its designated custodian;

      (4)   copies or revisions that add or change an identified assignee of theauthoritative copy can be made only with the consent of the person assertingcontrol;

      (5)   each copy of the authoritative copy and any copy of a copy is readilyidentifiable as a copy that is not the authoritative copy; and

      (6)   any revision of the authoritative copy is readily identifiable asauthorized or unauthorized.

      (d)   Except as otherwise agreed, a person having control of a transferablerecord is the holder, as defined inK.S.A. 2009 Supp.84-1-201(b)(21), andamendmentsthereto, of the transferable record and has the same rights and defenses as aholder of an equivalent record or writing under the uniform commercial code,including, if the applicable statutory requirements under K.S.A. 84-3-302(a),or 84-9-308, orK.S.A. 2009 Supp.84-7-501, and amendments thereto, aresatisfied, the rights anddefenses of a holder in due course, a holder to which a negotiable document oftitle has been duly negotiated, or a purchaser, respectively. Delivery,possession, and indorsement are not required to obtain or exercise any of therights under this subsection.

      (e)   Except as otherwise agreed, an obligor under a transferable record hasthe same rights and defenses as an equivalent obligor under equivalent recordsor writings under the uniform commercial code.

      (f)   If requested by a person against which enforcement is sought, the personseeking to enforce the transferable record shall provide reasonable proof thatthe person is in control of the transferable record. Proof may include accessto the authoritative copy of the transferable record and related businessrecords sufficient to review the terms of the transferable record and toestablish the identity of the person having control of the transferable record.

      History:   L. 2000, ch. 120, § 16;L. 2007, ch. 89, § 27;L. 2007, ch. 195, § 8; July 1, 2008.