Multiple choice

A ‘holder in due course’ is a person

  1. entitled to possess the negotiable instrument in his own name and to recover the amount

  2. who becomes a possessor of the negotiable instrument for consideration

  3. who holds the instrument as an agent of the payee

  4. who possesses the instrument only for the purpose of presentation for payment
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A ‘holder in due course’ is a person who has received a negotiable instrument in good faith and without notice that it is overdue, that there is any prior claim, or that there is a defect in the title of the person who negotiated it.

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