Although not classified as a real or personal defense, HDCs also have immunity from __________.
A) non-restrictive indorsements
B) litigious parties
C) claims in fact
D) claims in recoupment

Question

Quizplus · Accepted Answer

HDCs (Holders in Due Course) have immunity from claims in recoupment, which are defenses or claims that the original party to a negotiable instrument might have against the presenter of the instrument. This immunity allows HDCs to take the instrument free from these claims, enhancing the negotiability and reliability of such instruments in commerce.

Although Not Classified as a Real or Personal Defense, HDCs