47-3202. Negotiation subject to
rescission


A. Negotiation is effective even if obtained:


1. From an infant, a corporation exceeding its powers or a person without capacity;


2. By fraud, duress or mistake; or


3. In breach of duty or as part of an illegal transaction.


B. To the extent permitted by other law, negotiation may be rescinded or may be
subject to other remedies, but those remedies may not be asserted against a subsequent
holder in due course or a person paying the instrument in good faith and without
knowledge of facts that are a basis for rescission or other remedy.