Yes.

Since Excel is not a holder in due course, Excel is subject

onliberonontaib
to the personal defense which Po Press can set up against
vn6 to soldor on Jose. There was failure of consideration in the problem
because Jose failed to deliver the newsprint to Po Press (1994
Bar).
12.03. RIGHTS OF A HOLDER IN DUE COURSE (HDC)
a)
A holder in due course holds the instrument free
from any defect of title of prior parties, and free
from defenses available to prior parties among
themselves, and may enforce payment of the
instrument for the full amount thereof against all
parties liable thereon.
1)
a holder in due course is free from personal
defenses.
2)
a holder in due course is not free from real
defenses.
b)
c)
A holder not in due course is subject to personal
and real defenses (1978 Bar).
Exception: A holder who is not a holder in due
course, but he derived his title from a holder in
due course (Sec. 58, NIL).
May one who fails to inquire as to an infirmity in
a negotiable instrument and defect in the holder's
title, be a holder in due course?
d)
Yes. The law does not impose on a holder
the obligation to inquire into the infirmity in the
instrument or defect of the title of the person
negotiating it to him. However, failure to make
inquiry, when the circumstances indicate defect,
renders the holder not a holder in due course.
Gross negligence may amount to legal absence of
good faith (De Ocampo v. Gatchalian, 3 SCRA 596).
Shelter Rule. A Holder who is not himself a
holder in due course but is not a party to any
fraud or illegality affecting the instrument, and
who derives his title from a holder in due course
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