What is the significance of a defense being a real defense rather than a personal defense?
A) A real defense applies to order instruments, whereas a personal defense applies to bearer instruments.
B) A real defense applies where the negotiable instrument arose out of a business transaction, whereas a personal defense applies where the negotiable instrument arose out of a non-business transaction.
C) A real defense applies to a holder in due course, whereas a personal defense does not.
D) A real defense can be asserted at any time, whereas a personal defense must be asserted within 90 days of notice.
E) A real defense entitles the plaintiff to receive punitive damages, whereas a personal defense does not.

Question

Quizplus · Accepted Answer

A real defense can be used against a holder in due course, while a personal defense cannot. This means that real defenses are more powerful and can invalidate the instrument even in the hands of a holder in due course.

What Is the Significance of a Defense Being a Real