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Examples given in Holder in due Course

Corporate & Other Laws

Sir, In the video, an example given by madam in Holder in due course is -a person fraudly signing the BOE for Endorsement, then the person who receiving that become A Holder in due course since it received in good faith. But in the very next video with an example -there clarified that he is not a holder in due course since that instrument at the very first was Fraudulently singed. So please clarify this to finish the doubt.

Pranav Connecting...

CA Inter

★ 4K+

10-Jun-20 18:28

391

Answers (2)

There are two aspects here. If an instrument was originally created fraudently - the holder cannot enforce it and hence he wont be a holder in due course. If an instrument was originally created properly and endorsement was forged, a holder in good faith becomes a holder in due course.