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Home » Law Dictionary » H » HOLDER IN DUE COURSE

HOLDER IN DUE COURSE

TheLaw.com Law Dictionary & Black's Law Dictionary 2nd Ed.

A person who holds a note with a promise to pay the holder (check or promissory note) that was received in good faith and in exchange for something of value (consideration) and who has no knowledge of any wrongdoing or claim against the instrument by a third party. When such occurs, the holder of that instrument is entitled to be paid by the maker of the instrument. This person who holds the note may also be called a bona fide purchaser. A person may provide goods in exchange for a check made out to bearer not knowing that another party has a claim on the check. As such, the holder of the check who took it in good faith is entitled to payment by the maker.

Related Legal Terms & Definitions
  • HOLDER The holder of a bill of exchange, promissory note, or check is the person who…
  • PROMISSORY NOTE contracts. A written promise to pay a certain sum of money, at a future time,…
  • INDORSEE contracts. The person in whose favor an indorsement is made, 2. He is entitled to…
  • MAKER (A) This term is applied to one who makes a promissory note and promises to…
  • NEGOTIABLE PAPER contracts. This term is applied to bills of exchange and promissory notes, which are assignable…
  • OVERDRAFT To draw bills or cheeks upon an individual, bank or other corporation, for a greater…
  • PAYEE In mercantile law. The person In whose favor a bill of exchange, promissory note, or…
  • BONA FIDE In or with good faith; honestly, openly, and sincerely; without deceit or fraud. Truly; actually;…

Filed Under: H

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