{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/8.8A-202.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/8.8A-202.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/8.8A-202.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/8.8A-202.html"}],"law_id":63843,"edition_id":1,"section_id":63843,"structure_id":13974,"section_number":"8.8A-202","catch_line":"Issuer’s responsibility and defenses; notice of defect or defense","history":"1996, c. 216.","full_text":"a\n\nEven against a purchaser for value and without notice, the terms of a certificated security include terms stated on the certificate and terms made part of the security by reference on the certificate to another instrument, indenture, or document or to a constitution, statute, ordinance, rule, regulation, order, or the like, to the extent the terms referred to do not conflict with terms stated on the certificate. A reference under this subsection does not of itself charge a purchaser for value with notice of a defect going to the validity of the security, even if the certificate expressly states that a person accepting it admits notice. The terms of an uncertificated security include those stated in any instrument, indenture, or document or in a constitution, statute, ordinance, rule, regulation, order, or the like, pursuant to which the security is issued.b\n\nThe following rules apply if an issuer asserts that a security is not valid:1\n\nA security other than one issued by a government or governmental subdivision, agency, or instrumentality, even though issued with a defect going to its validity, is valid in the hands of a purchaser for value and without notice of the particular defect unless the defect involves a violation of a constitutional provision. In that case, the security is valid in the hands of a purchaser for value and without notice of the defect, other than one who takes by original issue.2\n\nParagraph (1) applies to an issuer that is a government or governmental subdivision, agency, or instrumentality only if there has been substantial compliance with the legal requirements governing the issue or the issuer has received a substantial consideration for the issue as a whole or for the particular security and a stated purpose of the issue is one for which the issuer has power to borrow money or issue the security.c\n\nExcept as otherwise provided in § 8.8A-205, lack of genuineness of a certificated security is a complete defense, even against a purchaser for value and without notice.d\n\nAll other defenses of the issuer of a security, including nondelivery and conditional delivery of a certificated security, are ineffective against a purchaser for value who has taken the certificated security without notice of the particular defense.e\n\nThis section does not affect the right of a party to cancel a contract for a security “when, as and if issued” or “when distributed” in the event of a material change in the character of the security that is the subject of the contract or in the plan or arrangement pursuant to which the security is to be issued or distributed.f\n\nIf a security is held by a securities intermediary against whom an entitlement holder has a security entitlement with respect to the security, the issuer may not assert any defense that the issuer could not assert if the entitlement holder held the security directly.","order_by":null,"text":{"0":{"id":232569,"text":"Even against a purchaser for value and without notice, the terms of a certificated security include terms stated on the certificate and terms made part of the security by reference on the certificate to another instrument, indenture, or document or to a constitution, statute, ordinance, rule, regulation, order, or the like, to the extent the terms referred to do not conflict with terms stated on the certificate. A reference under this subsection does not of itself charge a purchaser for value with notice of a defect going to the validity of the security, even if the certificate expressly states that a person accepting it admits notice. The terms of an uncertificated security include those stated in any instrument, indenture, or document or in a constitution, statute, ordinance, rule, regulation, order, or the like, pursuant to which the security is issued.","type":"section","prefixes":["a"],"prefix":"a","entire_prefix":"a","prefix_anchor":"a","level":1,"next_prefix":"b"},"1":{"id":232570,"text":"The following rules apply if an issuer asserts that a security is not valid:","type":"section","prefixes":["b"],"prefix":"b","entire_prefix":"b","prefix_anchor":"b","level":1,"prior_prefix":"a","next_prefix":"b1"},"2":{"id":232571,"text":"A security other than one issued by a government or governmental subdivision, agency, or instrumentality, even though issued with a defect going to its validity, is valid in the hands of a purchaser for value and without notice of the particular defect unless the defect involves a violation of a constitutional provision. In that case, the security is valid in the hands of a purchaser for value and without notice of the defect, other than one who takes by original issue.","type":"section","prefixes":["b","1"],"prefix":"1","entire_prefix":"b1","prefix_anchor":"b1","level":2,"prior_prefix":"b","next_prefix":"b2"},"3":{"id":232572,"text":"Paragraph (1) applies to an issuer that is a government or governmental subdivision, agency, or instrumentality only if there has been substantial compliance with the legal requirements governing the issue or the issuer has received a substantial consideration for the issue as a whole or for the particular security and a stated purpose of the issue is one for which the issuer has power to borrow money or issue the security.","type":"section","prefixes":["b","2"],"prefix":"2","entire_prefix":"b2","prefix_anchor":"b2","level":2,"prior_prefix":"b1","next_prefix":"c"},"4":{"id":232573,"text":"Except as otherwise provided in § 8.8A-205, lack of genuineness of a certificated security is a complete defense, even against a purchaser for value and without notice.","type":"section","prefixes":["c"],"prefix":"c","entire_prefix":"c","prefix_anchor":"c","level":1,"prior_prefix":"b2","next_prefix":"d"},"5":{"id":232574,"text":"All other defenses of the issuer of a security, including nondelivery and conditional delivery of a certificated security, are ineffective against a purchaser for value who has taken the certificated security without notice of the particular defense.","type":"section","prefixes":["d"],"prefix":"d","entire_prefix":"d","prefix_anchor":"d","level":1,"prior_prefix":"c","next_prefix":"e"},"6":{"id":232575,"text":"This section does not affect the right of a party to cancel a contract for a security “when, as and if issued” or “when distributed” in the event of a material change in the character of the security that is the subject of the contract or in the plan or arrangement pursuant to which the security is to be issued or distributed.","type":"section","prefixes":["e"],"prefix":"e","entire_prefix":"e","prefix_anchor":"e","level":1,"prior_prefix":"d","next_prefix":"f"},"7":{"id":232576,"text":"If a security is held by a securities intermediary against whom an entitlement holder has a security entitlement with respect to the security, the issuer may not assert any defense that the issuer could not assert if the entitlement holder held the security directly.","type":"section","prefixes":["f"],"prefix":"f","entire_prefix":"f","prefix_anchor":"f","level":1,"prior_prefix":"e"}},"ancestry":[{"id":13974,"edition_id":1,"name":"Issue and Issuer","identifier":"2","label":"part","depth":2,"order_by":1,"parent_id":13421,"metadata":{},"date_created":"2026-06-26 03:46:28","date_modified":"2026-06-26 03:46:28","permalink":{"id":283679,"object_type":"structure","relational_id":13974,"identifier":"2","token":"8.8A\/2","url":"\/8.8A\/2\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13421,"edition_id":1,"name":"Commercial Code \u2014 Investment Securities","identifier":"8.8A","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:44:52","date_modified":"2026-06-26 03:44:52","permalink":{"id":283611,"object_type":"structure","relational_id":13421,"identifier":"8.8A","token":"8.8A","url":"\/8.8A\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":78433,"structure_id":13974,"section_number":"8.8A-201","catch_line":"Issuer","url":"\/8.8A-201\/","token":"8.8A\/2\/8.8A-201","metadata":false},{"id":63843,"structure_id":13974,"section_number":"8.8A-202","catch_line":"Issuer's responsibility and defenses; notice of defect or defense","url":"\/8.8A-202\/","token":"8.8A\/2\/8.8A-202","metadata":false},{"id":58495,"structure_id":13974,"section_number":"8.8A-203","catch_line":"Staleness as notice of defect or defense","url":"\/8.8A-203\/","token":"8.8A\/2\/8.8A-203","metadata":false},{"id":64382,"structure_id":13974,"section_number":"8.8A-204","catch_line":"Effect of issuer's restriction on transfer","url":"\/8.8A-204\/","token":"8.8A\/2\/8.8A-204","metadata":false},{"id":71110,"structure_id":13974,"section_number":"8.8A-205","catch_line":"Effect of unauthorized signature on security certificate","url":"\/8.8A-205\/","token":"8.8A\/2\/8.8A-205","metadata":false},{"id":78840,"structure_id":13974,"section_number":"8.8A-206","catch_line":"Completion or alteration of security certificate","url":"\/8.8A-206\/","token":"8.8A\/2\/8.8A-206","metadata":false},{"id":55037,"structure_id":13974,"section_number":"8.8A-207","catch_line":"Rights and duties of issuer with respect to registered owners","url":"\/8.8A-207\/","token":"8.8A\/2\/8.8A-207","metadata":false},{"id":86239,"structure_id":13974,"section_number":"8.8A-208","catch_line":"Effect of signature of authenticating trustee, registrar or transfer agent","url":"\/8.8A-208\/","token":"8.8A\/2\/8.8A-208","metadata":false},{"id":73773,"structure_id":13974,"section_number":"8.8A-209","catch_line":"Issuer's lien","url":"\/8.8A-209\/","token":"8.8A\/2\/8.8A-209","metadata":false},{"id":65945,"structure_id":13974,"section_number":"8.8A-210","catch_line":"Overissue","url":"\/8.8A-210\/","token":"8.8A\/2\/8.8A-210","metadata":false}],"previous_section":{"id":78433,"structure_id":13974,"section_number":"8.8A-201","catch_line":"Issuer","url":"\/8.8A-201\/","token":"8.8A\/2\/8.8A-201","metadata":false},"next_section":{"id":58495,"structure_id":13974,"section_number":"8.8A-203","catch_line":"Staleness as notice of defect or defense","url":"\/8.8A-203\/","token":"8.8A\/2\/8.8A-203","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/8.8A-202\/","history_text":"

This law was first created in 1996. The record of its establishment is cataloged in chapter 216<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year.<\/p>","references":false,"refers_to":[{"id":71110,"section_number":"8.8A-205","catch_line":"Effect of unauthorized signature on security certificate","order_by":null,"url":"\/8.8A-205\/"}],"permalink":{"id":283685,"object_type":"law","relational_id":63843,"identifier":"8.8A-202","token":"8.8A\/2\/8.8A-202","url":"\/8.8A-202\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/8.8A-202\/","token":"8.8A\/2\/8.8A-202","dublin_core":{"Title":"Issuer’s responsibility and defenses; notice of defect or defense","Type":"Text","Format":"text\/html","Identifier":"\u00a7 8.8A-202","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

a.<\/span> Even against a purchaser for value and without notice, the terms of a certificated security include terms stated on the certificate and terms made part of the security by reference on the certificate to another instrument, indenture, or document or to a constitution, statute<\/span>, ordinance<\/span>, rule, regulation, order<\/span>, or the like, to the extent the terms referred to do not conflict with terms stated on the certificate. A reference under this subsection does not of itself charge a purchaser for value with notice of a defect going to the validity of the security, even if the certificate expressly states that a person accepting it admits notice. The terms of an uncertificated security include those stated in any instrument, indenture, or document or in a constitution, statute<\/span>, ordinance<\/span>, rule, regulation, order<\/span>, or the like, pursuant to which the security is issued. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

b.<\/span> The following rules apply if an issuer asserts that a security is not valid: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> A security other than one issued by a government or governmental subdivision, agency, or instrumentality, even though issued with a defect going to its validity, is valid in the hands of a purchaser for value and without notice of the particular defect unless the defect involves a violation of a constitutional provision. In that case, the security is valid in the hands of a purchaser for value and without notice of the defect, other than one who takes by original issue<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> Paragraph (1) applies to an issuer that is a government or governmental subdivision, agency, or instrumentality only if there has been substantial compliance with the legal requirements governing the issue<\/span> or the issuer has received a substantial consideration for the issue<\/span> as a whole or for the particular security and a stated purpose of the issue<\/span> is one for which the issuer has power to borrow money or issue<\/span> the security. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

c.<\/span> Except as otherwise provided in § 8.8A-205<\/a>, lack of genuineness of a certificated security is a complete defense, even against a purchaser for value and without notice. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

d.<\/span> All other defenses of the issuer of a security, including nondelivery and conditional delivery of a certificated security, are ineffective against a purchaser for value who has taken the certificated security without notice of the particular defense. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

e.<\/span> This section does not affect the right of a party<\/span> to cancel a contract<\/span> for a security “when, as and if issued” or “when distributed” in the event of a material<\/span> change in the character of the security that is the subject of the contract<\/span> or in the plan or arrangement pursuant to which the security is to be issued or distributed. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

f.<\/span> If a security is held by a securities intermediary against whom an entitlement holder has a security entitlement with respect to the security, the issuer may not assert any defense that the issuer could not assert if the entitlement holder held the security directly. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nISSUER’S RESPONSIBILITY AND DEFENSES; NOTICE OF DEFECT OR DEFENSE (\u00a7\n8.8A-202)\n\na. Even against a purchaser for value and without notice, the terms of a\ncertificated security include terms stated on the certificate and terms made\npart of the security by reference on the certificate to another instrument,\nindenture, or document or to a constitution, statute, ordinance, rule,\nregulation, order, or the like, to the extent the terms referred to do not\nconflict with terms stated on the certificate. A reference under this subsection\ndoes not of itself charge a purchaser for value with notice of a defect going to\nthe validity of the security, even if the certificate expressly states that a\nperson accepting it admits notice. The terms of an uncertificated security\ninclude those stated in any instrument, indenture, or document or in a\nconstitution, statute, ordinance, rule, regulation, order, or the like, pursuant\nto which the security is issued.\n\nb. The following rules apply if an issuer asserts that a security is not valid:\n\n 1. A security other than one issued by a government or governmental\n subdivision, agency, or instrumentality, even though issued with a defect\n going to its validity, is valid in the hands of a purchaser for value and\n without notice of the particular defect unless the defect involves a violation\n of a constitutional provision. In that case, the security is valid in the\n hands of a purchaser for value and without notice of the defect, other than\n one who takes by original issue.\n\n 2. Paragraph (1) applies to an issuer that is a government or governmental\n subdivision, agency, or instrumentality only if there has been substantial\n compliance with the legal requirements governing the issue or the issuer has\n received a substantial consideration for the issue as a whole or for the\n particular security and a stated purpose of the issue is one for which the\n issuer has power to borrow money or issue the security.\n\nc. Except as otherwise provided in § 8.8A-205, lack of genuineness of a\ncertificated security is a complete defense, even against a purchaser for value\nand without notice.\n\nd. All other defenses of the issuer of a security, including nondelivery and\nconditional delivery of a certificated security, are ineffective against a\npurchaser for value who has taken the certificated security without notice of\nthe particular defense.\n\ne. This section does not affect the right of a party to cancel a contract for a\nsecurity “when, as and if issued” or “when distributed”\nin the event of a material change in the character of the security that is the\nsubject of the contract or in the plan or arrangement pursuant to which the\nsecurity is to be issued or distributed.\n\nf. If a security is held by a securities intermediary against whom an\nentitlement holder has a security entitlement with respect to the security, the\nissuer may not assert any defense that the issuer could not assert if the\nentitlement holder held the security directly.\n\nHISTORY: 1996, c. 216.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}