Asked by Alyssa Wolski on May 20, 2024

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A holder in due course is free from the following personal defenses:

A) Lack or failure of consideration and breach of contract.
B) Fraud in the inducement in the underlying contract and breach of contract.
C) Lack or failure of consideration and fraud in the inducement in the underlying contract.
D) Lack or failure of consideration,breach of contract,and fraud in the inducement in the underlying contract.
E) Fraud in the essence,discharge of the party liable through bankruptcy,and material alteration of a completed instrument.

Personal Defenses

Legal defenses used in a lawsuit that are specific to the defendant, often relating to the contract's validity or terms.

Fraud in the Inducement

A deceitful act causing someone to enter into an agreement or contract by misrepresenting material facts or intentions.

Holder in Due Course

A party in possession of a negotiable instrument, such as a check or promissory note, acquired in good faith and thus protected against many defenses.

  • Differentiating between types of defenses against claims on negotiable instruments.
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Verified Answer

IH
Isaac HwangMay 25, 2024
Final Answer :
D
Explanation :
A holder in due course is generally free from personal defenses.Personal defenses include lack or failure of consideration,breach of contract,and fraud in the inducement in the underlying contract.