Legal negotiable-paper possessors {holder in due course} are not accountable for previous instrument-holder actions and have legal title to paper value. Finance companies that buy negotiable paper from merchants can get the money from consumers, even if merchants used deceit or other wrongful actions in original sales. Protection against negotiable paper is to have a restrictive clause in credit agreements to prevent commercial-paper transfer.
Practical Affairs>Financial Affairs>Investing>Commercial Paper
7-Financial Affairs-Investing-Commercial Paper
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Date Modified: 2022.0224