New York Uniform Commercial Code Law Section 3-302 - Holder in Due Course.

Section 3--302. 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
     (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.

Last modified: February 3, 2019