N.J. Stat. tit. 46, ch. 34

in effect

N.J. Stat. § 46:34-1 Contracts must be bona fide

All contracts and agreements between customers and brokers relating to the purchase or sale, either upon credit or margin, of any securities, choses in action, or commodities, including all evidences of debt or property and options for the purchase thereof, shares in any corporation or association, bonds, coupons, scrip, rights, and other evidences of indebtedness or property and options for the purchase thereof or anything movable that is bought or sold, wherein it is mutually understood and agreed by the parties thereto that such contracts or agreements shall be terminated, closed or settled according to, or upon the basis of the public market quotations of prices made on any board of trade or exchange upon which such securities, choses in action or commodities are dealt in and without intending a bona fide purchase or sale or the actual bona fide receipt or delivery of the same shall be utterly void and of no effect.

N.J. Stat. § 46:34-2 Contract; when effective

All contracts and agreements between customers and brokers respecting the purchase or sale either upon credit or margin of any securities, choses in action or commodities, of the character specifically referred to in section 46:34-1 of this title, wherein it is mutually understood and agreed by the parties thereto that the broker shall purchase or sell such securities, choses in action or commodities, as directed by the customer and for the account and risk of the customer, shall be valid and effective if such purchase or sale shall be actually made by the broker pursuant to such direction and for the account and risk of the customer, even though such purchase or sale may not be made in the customer's name and even though as between the broker and customer the securities, choses in action or commodities so purchased or sold, may not have been actually delivered to or by such customer.

N.J. Stat. § 46:34-3 Actions for recovery of money, property or chose in action

No action shall be brought or maintained by any customer or broker for the recovery of any money, property or chose in action of any kind or character which shall have been paid, deposited, delivered or advanced as collateral or otherwise or for any debt incurred pursuant to or in compliance with any contract or agreement which is declared by this chapter to be void, but nothing herein contained shall prevent any customer who is a party to a contract of the kind mentioned and described in section 46:34-2 of this title from bringing and maintaining an action for the recovery of any money, property or chose in action delivered or deposited under such contract in case the broker, party to such contract, shall not actually purchase or sell in accordance with the provisions of the contract the securities, choses in action or commodities as directed by the customer and for his account and risk.

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://www.njleg.state.nj.us/legislative-activity/statutesFetched: 10/17/2026