A transferor acquires greater rights than a holder in due course.

Question

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A holder in due course is a buyer of a negotiable instrument who has met certain legal requirements, such as taking the instrument for value and in good faith, without notice of any defects or claims against it. A transferor, on the other hand, is simply someone who transfers ownership of the instrument to another party. While a holder in due course has certain protections under the law, such as immunity from certain defenses and claims that may be raised against the underlying transaction, a transferor does not enjoy these same protections. Therefore, a holder in due course generally has greater rights than a mere transferor.

A Transferor Acquires Greater Rights Than a Holder in Due