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.
La. R.S. 10:3-306
Claims to an instrument
Acts 1992, No. 1133, §3, eff
Official source: Louisiana State Legislature. Reproduced from public-domain Louisiana statutes; confirm against the official source for the current text. Not legal advice.