ORS 73.0302
Holder in due course


(1)

Subject to ORS 73.0106 (Unconditional promise or order) (3) and (4), “holder in due course” means the holder of an instrument if:

(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; and

(b)

The holder took the instrument:

(A)

For value;

(B)

In good faith;

(C)

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;

(D)

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

(E)

Without notice of any claim to the instrument described in ORS 73.0306 (Claims to an instrument); and

(F)

Without notice that any party has a defense or claim in recoupment described in ORS 73.0305 (Defenses and claims in recoupment).

(2)

Notice of discharge of a party, other than discharge in an insolvency proceeding, is not notice of a defense under subsection (1) of this section, 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 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:

(a)

By legal process or by purchase in an execution, bankruptcy or creditor’s sale or similar proceeding;

(b)

By purchase as part of a bulk transaction not in ordinary course of business of the transferor; or

(c)

As the successor in interest to an estate or other organization.

(4)

If, under ORS 73.0303 (Value and consideration) (1)(a), the promise of performance that is the consideration for an instrument has been partially performed, the holder may assert rights as a holder in due course of the instrument only to the fraction of the amount payable under the instrument equal to the value of the partial performance divided by the value of the promised performance.

(5)

If the person entitled to enforce an instrument has only a security interest in the instrument and the person obliged to pay the instrument has a defense, claim in recoupment or claim to the instrument that may be asserted against the person who granted the security interest, the person entitled to enforce the instrument may assert rights as a holder in due course only to an amount payable under the instrument which, at the time of enforcement of the instrument, does not exceed the amount of the unpaid obligation secured.

(6)

To be effective, notice must be received at a time and in a manner that gives a reasonable opportunity to act on it.

(7)

This section is subject to any law limiting status as a holder in due course in particular classes of transactions. [1993 c.545 §31]

Source: Section 73.0302 — Holder in due course, https://www.­oregonlegislature.­gov/bills_laws/ors/ors073.­html.

73.0101
Short title
73.0102
Application of chapter
73.0103
Definitions
73.0104
Negotiable instrument
73.0105
Issue of instrument
73.0106
Unconditional promise or order
73.0107
Instrument payable in foreign money
73.0108
Payable on demand or at definite time
73.0109
Payable to bearer or to order
73.0110
Identification of person to whom instrument is payable
73.0111
Place of payment
73.0112
Interest
73.0113
Date of instrument
73.0114
Contradictory terms of instrument
73.0115
Incomplete instrument
73.0116
Joint and several liability
73.0117
Other agreements affecting instrument
73.0118
Statute of limitations
73.0119
Notice of right to defend action
73.0201
Negotiation
73.0202
Negotiation subject to rescission
73.0203
Transfer of instrument
73.0204
Indorsement
73.0205
Special indorsement
73.0206
Restrictive indorsement
73.0207
Reacquisition
73.0301
Person entitled to enforce instrument
73.0302
Holder in due course
73.0303
Value and consideration
73.0304
Overdue instrument
73.0305
Defenses and claims in recoupment
73.0306
Claims to an instrument
73.0307
Notice of breach of fiduciary duty
73.0308
Proof of signatures and status as holder in due course
73.0309
Enforcement of lost, destroyed or stolen instrument
73.0310
Effect of instrument on obligation for which taken
73.0311
Accord and satisfaction
73.0312
Lost, destroyed or stolen cashier’s check, teller’s check or certified check
73.0401
Signature
73.0402
Signature by representative
73.0403
Unauthorized signature
73.0404
Impostors
73.0405
Employer’s responsibility for fraudulent indorsement by employee
73.0406
Negligence contributing to forged signature or alteration of instrument
73.0407
Alteration
73.0408
Drawee not liable on unaccepted draft
73.0409
Acceptance of draft
73.0410
Acceptance varying draft
73.0411
Refusal to pay cashier’s checks, teller’s checks and certified checks
73.0412
Obligation of issuer of note or cashier’s check
73.0413
Obligation of acceptor
73.0414
Obligation of drawer
73.0415
Obligation of indorser
73.0416
Transfer warranties
73.0417
Presentment warranties
73.0418
Payment or acceptance by mistake
73.0419
Instruments signed for accommodation
73.0420
Conversion of instrument
73.0501
Presentment
73.0502
Dishonor
73.0503
Notice of dishonor
73.0504
Excused presentment and notice of dishonor
73.0505
Evidence of dishonor
73.0601
Discharge and effect of discharge
73.0602
Payment
73.0603
Tender of payment
73.0604
Discharge by cancellation or renunciation
73.0605
Discharge of indorsers and accommodation parties
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