Final answer:
While it is true that a holder in due course must hold a complete instrument, an incomplete instrument can still lead to holder in due course status if it is completed appropriately and other criteria are met. The principle of justice in acquisition and transfer are respected if all conditions are satisfied, supporting the legitimacy of the holding.
Step-by-step explanation:
Regarding the statement “A holder in due course is one who becomes the holder of a complete instrument. Therefore, if the maker issues an incomplete instrument to the payee, the latter is a holder not in due course,” the first part is correct. A holder in due course is indeed someone who has obtained an instrument that is complete and regular on its face, acquired it for value, in good faith, and without notice of any defect or claims.
However, the concluding part of the statement is not necessarily true. Even if an instrument is initially incomplete, a payee or subsequent holder may become a holder in due course if they complete the instrument (if they are authorized) and meet the other criteria set forth under the UCC — like taking it in good faith and without notice of any claim or defense against it.
This aligns with the stated principles of justice concerning acquisition and transfer of holdings. Firstly, a person is entitled to a holding if they acquire it justly and fairly according to principle (1). Secondly, a person is entitled if they acquire their holding through a legitimate transfer from another entitled person, as in principle (2). Incomplete instruments that are completed consistently with the original parties' agreement may still convey holder in due course rights if the other conditions are met, respecting these principles of justice in business transactions.