A claim in recoupment:
A) is a claim of the original payee against the obligor of the instrument.
B) must arise from the transaction that gave rise to the instrument.
C) is actually not an offset to liability, but a defense to an instrument.
D) can make a person a holder in due course even if he knows about it before the negotiation.

Question

Quizplus · Accepted Answer

A claim in recoupment is a claim of the person obligated on the instrument against the original payee of the instrument. The claim must arise from the transaction that gave rise to the instrument.

A Claim in Recoupment