A holder may still become a holder in due course if he or she is aware of which of the following defects?
A) The instrument has been dishonored.
B) The instrument is overdue.
C) The instrument contains an unauthorized signature.
D) The instrument contains a misspelled name.
E) There is a claim to the instrument.

Question

Quizplus · Accepted Answer

A holder can still become a holder in due course even if aware of minor defects such as a misspelled name, as this does not fundamentally affect the validity or enforceability of the instrument. Other options listed typically disqualify one from achieving holder in due course status due to their impact on the instrument's negotiability or legitimacy.

A Holder May Still Become a Holder in Due Course