Alabama § 5-19-5 Acceptance of Negotiable Instruments as Evidence of Consumer Debt

Alabama Statutes

§ 5-19-5 — Acceptance of Negotiable Instruments as Evidence of Consumer Debt

Alabama·Title 5 Banks and Financial Institutions·Ch. 19 Consumer Finance

In a consumer credit sale, the seller may not take as evidence of the obligation of the buyer, a negotiable instrument other than (1) a check; or (2) a promise or order containing a statement, required by applicable statutory or administrative law, to the effect that the rights of a holder or transferee are subject to claims or defenses that the issuer could assert against the original payee. A holder is not a holder in due course if the holder takes a negotiable instrument with notice that it is issued in violation of this section. A holder in due course is not subject to the liabilities prescribed in this chapter.

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In a consumer credit sale, the seller may not take as evidence of the obligation of the buyer, a negotiable instrument other than (1) a check; or (2) a promise or order containing a statement, required by applicable statutory or administrative law, to the effect that the rights of a holder or transferee are subject to claims or defenses that the issuer could assert against the original payee. A holder is not a holder in due course if the holder takes a negotiable instrument with notice that it is issued in violation of this section. A holder in due course is not subject to the liabilities prescribed in this chapter.

Alabama § 5-19-5 (Acceptance of Negotiable Instruments as Evidence of Consumer Debt) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.