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An instrument signed by a person who has been declared mentally incompetent by a court is:

a. unenforceable by an ordinary holder, but enforceable by an HDC.
b. enforceable by any holder, including an HDC.
c. unenforceable by any holder, including an HDC.

1 Answer

7 votes

Answer:

Answer is option c, i.e. unenforceable by any holder, including an HDC.

Step-by-step explanation:

When any instrument is signed by a person, who has been declared mentally incompetent by a court, then such an instrument is considered void and it stands unenforceable by any holder including the holder in due course (an HDC). A mentally incompetent person does not have adequate knowledge of the activities carried by him/her and is not treated as a genuine.

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