What is the effect on Susan's status as a holder in due course in taking the check from the customer that was four months old?
A) There is no effect on her status as a holder in due course because an instrument such as a check is only considered overdue if it is outstanding for 150 days.
B) There is no effect on her status as a holder in due course because an instrument is only considered overdue if it is outstanding for 180 days.
C) There is no effect on her status as a holder in due course because an instrument is only considered overdue if it is outstanding for one year.
D) It has no effect because a check is never considered overdue.
E) She would not be considered a holder in due course because a check is considered overdue 90 days after its date.

Question

Quizplus · Accepted Answer

If a demand instrument is a check, it is overdue 90 days after its date [UCC 3-304(a)(2)]. The date on the check gives another party notice of its overdue status; thus, the party cannot be an HDC.

What Is the Effect on Susan's Status as a Holder