New York Uniform Commercial Code Law Section 3-305 - Rights of a Holder in Due Course.

Section 3--305. Rights of a Holder in Due Course.
To  the  extent  that  a holder is a holder in due course he takes the
  instrument free from
(1) all claims to it on the part of any person; and
(2) all defenses of any party to the instrument with whom  the  holder
  has not dealt except
     (a) infancy,  to  the  extent  that  it  is a defense to a simple
         contract; and
     (b) such other  incapacity,  or  duress,  or  illegality  of  the
         transaction,  as  renders  the  obligation  of  the  party  a
         nullity; and
     (c) such misrepresentation as has induced the party to  sign  the
         instrument  with neither knowledge nor reasonable opportunity
         to obtain knowledge of its character or its essential  terms;
         and
     (d) discharge in insolvency proceedings; and
     (e) any  other  discharge  of which the holder has notice when he
         takes the instrument.

Last modified: February 3, 2019