What is the effect of the alteration of the check on Susan's status as a holder in due course?
A) The alteration has no effect because a holder is not charged with examining an instrument presented for payment.
B) The alteration will likely prohibit her from being a holder in due course.
C) The alteration will affect her status as a holder in due course only if she had been put on notice of prior criminal behavior in the past on the part of Bob.
D) The alteration will affect her status as a holder in due course only if the issuer can establish that it was not negligent in allowing a thief to gain access resulting in the alteration.
E) On the basis that the law does not want to unduly burden holders, the alteration will affect her status as a holder in due course only because the instrument was written for an amount in excess of $500.

Question

Quizplus · Accepted Answer

Suppose a person receives an instrument that has clearly been altered but she does not notice the alteration. According to UCC requirements [3-302(a)(1)], the holder's awareness does not matter; the mere existence of such irregularities means that the holder cannot be a holder in due course.

What Is the Effect of the Alteration of the Check