283 BILLS OF EXCHANGE AND PROMISSORY NOTES. [ART. 13

3. That he took it in good faith and for value.

4. That at the time it was negotiated to him he had no notice of any
infirmity in the instrument or defect in the title of the person negotia-
ting it.

Where the plaintiff takes a note with knowledge of the insolvency of the
corporation which made it, and that it was issued by the company in part
payment for its own capital stock (which the law prohibits it from buying),
he is not a holder in due course. Burke v. Smith. 111 Md. 627.

A check held to be complete and regular on its face, and that the endorsee
took it without knowledge of such facts as made his taking it amount to
bad faith—see section 75. Weant v. Southern Trust Co., 112 Md. 471.

1904, art. 13, sec. 72. 189S, ch. 119

72. Where an instrument payable on demand is negotiated an unrea-
sonable length of time after its issue, the holder is not deemed a holder
in due course.

Ibid. sec. 73. 1898, ch. 119.

73. Where the transferee receives notice of any infirmity in the
instrument or defect in the title of the person negotiating the same
before he has paid the full amount agreed to be paid therefor, he will
be deemed a holder in due course only to the extent of the amount there-
tofore paid by him.

Ibid. sec. 74. 1S98, ch. 119.

74. The title of a person who negotiates an instrument is defective
within the meaning of this act, when he obtained the instrument, or any
signature thereto, by fraud, duress, or force and fear, or other unlawful
means, or for an illegal consideration, or when he negotiates it in breach
of faith, or under such circumstances as amounts to a fraud.

Where the plaintiff takes a note with knowledge of the insolvency of
the corporation which made it, and that it was issued by the company in
part payment for its own capital stock (which the law prohibits it from
buying), he is not a holder in due course. Burke v. Smith. 111 Md. 627.
See notes to sec. 78.

Ibid. sec. 75. 1898. ch. 119.

75. To constitute notice of an infirmity in the instrument or defect
in the title of the person negotiating the same, the person to whom it is
negotiated must have had actual knowledge of the infirmity or defect,
or knowledge of such facts that his action in taking the instrument
amounted to bad faith.

In a suit by the endorsee against the maker, pleas setting up fraud and
breach of faith in the negotiation of a note, are bad unless they allege
that the plaintiff took the note with a knowledge of the fraud or breach
of faith. Black v. Bank of Westminster, 96 Md. 416.

This section applied. Instructions held contradictory. Valley Savings
Bank v. Mercer. 97 Md. 479. See also, Weant v. Southern Trust Co., 112
Md. 471. Cover v. Myers, 75 Md. 418.

See notes to sec. 71.

Ibid. sec. 76. 1898, ch. 119.

76. A holder in due course holds the instrument free from any
defect of title of prior parties, and free from defenses available to prior