Another useful definition sourced recently.
Holder in due course
Legal term for an original or any subsequent holder of a negotiable
instrument (check, draft, note, etc.) who has accepted it in good-faith and has exchanged something valuable for it. For
example, anyone who accepts a third-party check is a holder in due course. He or she has
certain legal
rights, and is presumed to be unaware that
(if such were the case) the instrument was at any time overdue, dishonoured when presented for payment, had any claims against it, or the party required to pay it has valid reason for not doing so. Also called protected
holder, or bona fide
holder for value.
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