Asked by Monisa Siddiqi on Jun 29, 2024
Verified
A(n) ________ takes a negotiable instrument free of all personal defenses,claims to the instrument,and claims in recoupment either of the obligor or of a third party.
A) holder in due course
B) holder
C) indorsee
D) transferee
Holder In Due Course
A legal status given to a person who has acquired a negotiable instrument in good faith and for value, affording them certain rights free of defenses.
Negotiable Instrument
A written document guaranteeing the payment of a specific sum of money to a person or entity, with the ability to be transferred to another holder.
Personal Defenses
Legal arguments that an individual can use to avoid enforcement of a contract or document due to personal circumstances, such as fraud, duress, or incapacity.
- Recognize the requirements and judicial implications involved in the process of becoming a holder or holder in due course.
- Comprehend the significance of the holder in due course rule and its exceptions.
Verified Answer
KH
Khadro HassanJul 01, 2024
Final Answer :
A
Explanation :
A holder in due course takes a negotiable instrument free of all personal defenses,claims to the instrument,and claims in recoupment either of the obligor or of a third party.
Learning Objectives
- Recognize the requirements and judicial implications involved in the process of becoming a holder or holder in due course.
- Comprehend the significance of the holder in due course rule and its exceptions.