Winter & Hirsch, Inc. v. Passarelli

Dominic and Antoinette Passarelli (defendants) obtained a $10,000 loan from Equitable Mortgage & Investment Corporation, signing a promissory note to repay $16,260 over 60 months at a usurious rate. Before the note was executed, Winter & Hirsch, Inc. (plaintiff) issued a $11,000 check to Equitable noting the funds were for the Passarellis' loan. When the Passarellis defaulted, Winter sued as a claimed holder in due course. The Passarellis raised usury. The trial court found Winter was a holder in due course, rejected the usury defense, and entered judgment for Winter. The Passarellis appealed.

Whether a party who takes a negotiable instrument so incomplete, visibly forged or altered, or irregular as to call its authenticity into question has notice of a claim or defense.