Personal defenses cannot be raised against HDCs to deny the payment of negotiable instruments.

Question

Quizplus · Accepted Answer

This is true according to the concept of holder in due course (HDC) in negotiable instruments law. HDCs are protected by law and are entitled to receive payment despite any personal defenses that the obligor (the person who signed the instrument) may have had against the original holder. This encourages the free flow and negotiation of negotiable instruments in commerce.

Personal Defenses Cannot Be Raised Against HDCs to Deny the Payment