holder in due course

holder in due course
In commercial law, a holder of an instrument who took it for value, in good faith and without notice of any claim or defense against it, U.C.C. No. 3-302(1), and who can enforce the instrument free from all claims and personal defenses. U.C.C. No. 3-305. A payee may be a holder in due course. A holder does not become a holder in due course of an instrument by purchase of it at a judicial sale or by taking it under legal process, or by acquiring it in taking over an estate, or by purchasing it as part of a bulk transaction not in regular course of business of the transferor. A purchaser of a limited interest can be a holder in due course only to the extent of the interest purchased. Kaw Valley State Bank & Trust Co. v. Riddle, 219 Kan. 550, 549 P.2d 927, 933. A holder in due course of a consumer credit contract (i.e. consumer paper) is subject to all claims and defenses which the debtor (buyer) could assert against the seller of the goods or services obtained pursuant to the credit contract or with the proceeds thereof. 16 CFR No. 433.1 et seq
See also real defenses

Black's law dictionary. . 1990.

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  • holder in due course — holder in due course: the holder of a negotiable instrument that is complete and regular on its face and that is taken in good faith and for value without notice that it is overdue or has been dishonored or that there is any defense against it or …   Law dictionary

  • Holder in due course — Holder in due course, or (HDC) is a term used in law to refer to an innocent party who purchases a negotiable instrument for value without any apparent defect in the instrument nor any notice of dishonor. (Black s Law Dictionary 2nd Pocket ed.… …   Wikipedia

  • holder in due course — In commercial law, a holder of an instrument who took it for value, in good faith and without notice of any claim or defense against it, U.C.C. No. 3 302(1), and who can enforce the instrument free from all claims and personal defenses. U.C.C. No …   Black's law dictionary

  • holder in due course — Broadly, a bona fide holder for value without notice. 11 Am J2d B & N § 397. A holder of a negotiable instrument or document of title who has taken the instrument under the following conditions: that it is complete and regular upon its face; that …   Ballentine's law dictionary

  • holder in due course — the holder of a negotiable instrument that is complete and regular on its face who takes it in good faith and for value before it is overdue and without notice of its dishonor or of any infirmity in it or of any defect in the title of the person… …   Useful english dictionary

  • holder in due course — Date: 1882 one other than the original recipient who holds a legally effective negotiable instrument (as a promissory note) and who has a right to collect from and no responsibility toward the issuer …   New Collegiate Dictionary

  • holder in due course — a person who has received a negotiable instrument in good faith and without notice that it is overdue, that there is any prior claim, or that there is a defect in the title of the person who negotiated it. [1890 95] * * * …   Universalium

  • holder in due course — person that holds a promissory note that was legally transferred to him …   English contemporary dictionary

  • holder in due course — /ˌhəυldə ɪn dju: kɔ:s/ noun a person who holds a negotiable instrument, such as a bill of exchange, in good faith, without knowing of any other claim against it …   Dictionary of banking and finance

  • due course — See holder in due course. Collins dictionary of law. W. J. Stewart. 2001 …   Law dictionary

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