This lesson is the first of two covering the holder in due course doctrine (HDIC). The doctrine provides that a "holder" who takes an instrument (1) for value, (2) without notice of any claims, defenses, or facts that should have raised questions about the validity of the instrument, and (3) in good faith is free of personal defenses.

Thus, when a HDIC demands payment from the maker of a note or the drawee of a check, the maker or the drawee cannot argue, for instance, that they were defrauded or that the other party in the underlying transaction breached.

I hope you find the lesson helpful.

Chapters
00:00:00 - Introduction
00:01:10 - (1) The Holder in Due Course Doctrine
00:01:21 - (a) Remembering assignment under contract law
00:04:30 - (b) Consider result under negotiable instrument law
00:13:31 - (c) Reasons for HIDC doctrine
00:17:03 - (d) Consumer credit sales and the HIDC doctrine
00:23:04 - (2) Becoming A Holder in Due Course
00:24:05 - (a) First requirement: Holder
00:29:23 - (b) Second requirement: Value
00:46:57 - (c) Third requirement: No notice
00:52:32 - (d) Fourth requirement: Good faith
00:55:47 -(3) The Shelter Rule
00:56:52 - (a) UCC § 3-203(b) explained and applied
01:07:03 - (b) Rationale for the shelter rule
01:09:46 - Conclusion/Outro

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