Sprock is a holder in due course on an instrument issued by a Klingon.Which of the following defenses could be successfully raised by the Klingon?
A)Forgery.
B)Prior payment.
C)Breach of contract.
D)Fraud in the inducement.

Question

Quizplus · Accepted Answer

If the instrument was forged, then the Klingon could successfully raise the defense of forgery. As a holder in due course, Sprock would typically be immune to personal defenses (such as breach of contract or fraud in the inducement), but not to real defenses like forgery. Prior payment would also not be a valid defense, as Sprock would have no reason to believe that the instrument had already been paid.

Sprock Is a Holder in Due Course on an Instrument