Uniform Commercial Code

U.C.C. - ARTICLE 3 - NEGOTIABLE INSTRUMENTS
..PART 3. ENFORCEMENT OF INSTRUMENTS

§ 3-306. CLAIMS TO AN INSTRUMENT.

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.