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 contains an unauthorized signature.
B)The instrument is overdue.
C)There is a claim to the instrument.
D)The instrument has been dishonored.
E)The instrument contains a misspelled name.

Question

Quizplus · Accepted Answer

A)A holder cannot be an HDC who has notice or is aware of any of the following
defects [UCC 3-302a)]: 1)The instrument is overdue.2)The instrument has been dishonored.3)The instrument was issued as part of a series that is in default.4)The instrument has been altered or contains an unauthorized signature.5)There is a claim to the instrument.The claims are described in Section 3-306. )6)Another party has a defense or claim in recoupment to the instrument.
B)A holder cannot be an HDC who has notice or is aware of any of the following defects [UCC 3-302a)]: 1)The instrument is overdue.2)The instrument has been dishonored.3)The instrument was issued as part of a series that is in default.4)The instrument has been altered or contains an unauthorized signature.5)There is a claim to the instrument.The claims are described in Section 3-306. )6)Another party has a defense or claim in recoupment to the instrument.
C)A holder cannot be an HDC who has notice or is aware of any of the following defects [UCC 3-302a)]: 1)The instrument is overdue.2)The instrument has been dishonored.3)The instrument was issued as part of a series that is in default.4)The instrument has been altered or contains an unauthorized signature.5)There is a claim to the instrument.The claims are described in Section 3-306. )6)Another party has a defense or claim in recoupment to the instrument.

A Holder May Still Become a Holder in Due Course