Title of holder free from all defectsA person who is holding negotiated instrument he is free from a defectin the title of the transferor Ex: S sells certain goods to B. B gives a promissory note to S for theprice. He refuses to pay the promissory note, claiming that the goodsare not according to order. If S sues B on the note, B’s defence isgood. But if he negotiates the note to H, a holder in due course, B’sdefence will be of no avail.
RecoveryA holder of the negotiable instrument can sue for recovery of theamount.
Negotiable instrument is for consideration
Reasonable Time of acceptance
Before the maturity it should transferred
Stamp when there is a dishonour