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Business LibreTexts

21: Holder in Due Course and Defenses

  • Page ID
    30677
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    Learning Objectives

    After reading this chapter, you should understand the following:

    1. What a holder in due course is, and why that status is critical to commercial paper
    2. What defenses are good against a holder in due course
    3. How the holder-in-due-course doctrine is modified in consumer transactions

    In this chapter, we consider the final two questions that are raised in determining whether a holder can collect:

    1. Is the holder a holder in due course?
    2. What defenses, if any, can be asserted against the holder in due course to prevent collection on the instrument?