403.302 Holder in due course.

269 words·~1 min read·/wi/chapter-403/403-302-3

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(1)Subject to sub.

(3)and s. 403.106

(4), “holder in due course” means the holder of an instrument if all of the following apply:

(a)The instrument when issued or negotiated to the holder does not bear such apparent evidence of forgery or alteration or is not otherwise so irregular or incomplete as to call into question its authenticity.

(b)The holder took the instrument:

1. For value;

2. In good faith;

3. Without notice that the instrument is overdue or has been dishonored or that there is an uncured default with respect to payment of another instrument issued as part of the same series;

4. Without notice that the instrument contains an unauthorized signature or has been altered;

5. Without notice of any claim to the instrument described in s. 403.306 ; and

6. Without notice that any party has a defense or claim in recoupment described in s. 403.305

(1).

(2)Notice of discharge of a party, other than discharge in an insolvency proceeding, is not notice of a defense under sub.

(1), but discharge is effective against a person who became a holder in due course with notice of the discharge. Public filing or recording of a document does not of itself constitute notice of a defense, claim in recoupment or claim to the instrument.

(3)Except to the extent that a transferor or predecessor in interest has rights as a holder in due course, a person does not acquire rights of a holder in due course of an instrument taken in any of the following ways: