Does a seller of preferred stock retain accrued but unpaid dividends after the sale. What is the policy?

Question

The individual owns approximately 60 percent of preferred stock in a company and he wishes to sell it or give it to a charity. However, he is entitled at the moment to dividends that have been accrued but unpaid. If he sells this stock does he retain the right to cash in on the unpaid dividend?

Answer 1

If it's non-cumulative preferred - the answer is "no" for sure, because no omitted dividends will be repaid. If it is cumulative preferred (the dividend in arrears should be repaid at some point), I believe the answer is still "no". The logic is that once she/he sells the shares, the new shareholder will be put on record. When the dividend is declared, payment will go to shareholders on record (on the last ***-dividend date).