State Codes and Statutes

Statutes > Connecticut > Title42a > Art003 > Sec42a-3-306

      Sec. 42a-3-306. Claims to an instrument. A person taking an instrument, other than a person having rights of a holder in due course, is subject to a claim of a property or possessory right in the instrument or its proceeds, including a claim to rescind a negotiation and to recover the instrument or its proceeds. A person having rights of a holder in due course takes free of the claim to the instrument.

      (1959, P.A. 133, S. 3-306; P.A. 91-304, S. 32.)

      History: P.A. 91-304 revised former Subdiv. (a) re the claims to an instrument which a person not having the rights of a holder in due course is subject to and deleted former Subdivs. (b), (c) and (d) re the defenses which a person not having the rights of a holder in due course is subject to.

      See Sec. 42a-3-305(a)(2) for successor provisions to Sec. 42a-3-306(b), revised to 1991, re defenses available in an action on a simple contract.

      See Secs. 42a-3-105(b), 42a-3-303(b) and 42a-3-305(a)(2) for successor provisions to Sec. 42a-3-306(c), revised to 1991, re defenses of want or failure of consideration, nonperformance of any condition precedent, nondelivery or delivery for a special purpose.

      See Sec. 42a-3-305(c) for successor provisions to Sec. 42a-3-306(d), revised to 1991, re defense that the instrument was acquired by theft.

      Annotations to former statutes:

      (1958 Rev., S. 39-59): Defenses which may be made do not include matter arising out of collateral transactions. 70 C. 9. Fraudulent alteration and reissuance of note once paid is a defense. 89 C. 594. Defenses that endorsement was to give credit and that receiver taking note did not act within authority, not available to him individually, where he endorsed without qualification before delivery to purchaser for value. 124 C. 177. Cited. 139 C. 539.

      Cited. 19 CS 124.

      (1958 Rev., S. 39-60): Effect of this provision. 79 C. 348; 80 C. 60; 82 C. 333; 89 C. 128; Id., 592; 105 C. 79. Burden of proof that holder is not a holder in due course is on endorser contesting liability except when affected by this section. 92 C. 707; 102 C. 624. Position of signature of endorser as showing priority between several endorsers. 97 C. 315. Burden is on holder bringing action to go forward with evidence; upon laying in note, burden of going forward shifts to defendant; burden of proof is at all times on plaintiff. 111 C. 182; 118 C. 115. Allegation that plaintiff was owner and holder sufficient. Id. Cited. 119 C. 370.

      Cited. 18 CS 15; 19 CS 124; Id., 406.

      Annotations to present section:

      Waiver of defense clause in consumer sales contract void as opposed to policy of this section. 158 C. 543. Cited. 207 C. 483. Cited. 217 C. 205. Cited. 240 C. 10.

      Cited. 33 CS 641.

      Former Subdiv. (d):

      Cited. 205 C. 604.