B LAW 220 Lecture Notes - Lecture 9: Certified Check, Secondary Liability
Document Summary
A holder through a holder in due course gets the same protection as a hdc gets. Hdc is not subject to personal defense, but is subject to real (universal) defense : that means a hdc will win against someone with a personal defense, but will lose to someone who has a real defense. Fraud in the inducement: the check was written because it was fraudulently induced by a lie. Fraud as to the nature of the payer: Alteration: a real defense as to the amount of the increase. If a check is altered from 100 to 400, the original 100 is enforceable but not the extra 300. It means absolute obligation to pay (eg. on a primary note) On a personal check there is no primary liability not unless the drawee bank certifies the check ( the bank will have primary liability) Secondary liability: obligation to make good on a check which is bounced.
