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.
S.D. Codified Laws § 57A-3-306
Claims to an instrument
Known as the Uniform Commercial Code
The act spans §§ 57–57 (574 sections).
Source: SL 1994, ch 367, § 3-306.
Official source: South Dakota Legislature. Reproduced from public-domain South Dakota statutes; confirm against the official source for the current text. Not legal advice.