Holder in Due Course

(1)A holder in due course is a holder who takes the instrument

(a)For value; and

(b)In good faith; and COL120106 DIV. 3 COMMERCIAL PAPER

(c)Without notice that it is overdue or has been dishonored or of any defense against or claim to it on the part of any person.

(2)A payee may be a holder in due course.

(3)A holder does not become a holder in due course of an instrument:

(a)By purchase of it at judicial sale or by taking it under legal process; or

(b)By acquiring it in taking over an estate; or

(c)By purchasing it as part of a bulk transaction not in regular course of business of the transferor.

(4)A purchaser of a limited interest can be a holder in due course only to the extent of the interest purchased.