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Texas Business and Commerce Code - BUS & COM § 3.202. Negotiation Subject to Rescission

Current as of April 14, 2021 | Updated by FindLaw Staff

(a) Negotiation is effective even if obtained:

(1) from an infant, a corporation exceeding its powers, or a person without capacity;

(2) by fraud, duress, or mistake;  or

(3) in breach of duty or as part of an illegal transaction.

(b) To the extent permitted by other law, negotiation may be rescinded or may be subject to other remedies, but those remedies may not be asserted against a subsequent holder in due course or a person paying the instrument in good faith and without knowledge of facts that are a basis for rescission or other remedy.

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Cite this article: FindLaw.com - Texas Business and Commerce Code - BUS & COM § 3.202. Negotiation Subject to Rescission - last updated April 14, 2021 | https://codes.findlaw.com/tx/business-and-commerce-code/bus-com-sect-3-202/

Read this complete Texas Business and Commerce Code - BUS & COM § 3.202. Negotiation Subject to Rescission on Westlaw

FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature or via Westlaw before relying on it for your legal needs.

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