Holder Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Holder, written in plain English, along with examples of how it is used.

What is Holder?

(n) Holder is the person who possess a property being the owner of the property or as a holder in due course. The term is generally used with financial instrument representing the present possession and right in the instrument

History and Meaning of Holder

Holder is a legal term used to refer to a person who is in the possession of a property, either as the owner of the property or as a holder in due course. The term is commonly used to describe a person who possesses a financial instrument, such as a check or promissory note.

In the case of financial instruments, a holder is a person who has the right to receive payment from the instrument. Holders are distinct from owners, as an owner may not necessarily be in possession of the financial instrument. The distinction between owners and holders is important in cases where there are disputes over ownership or rights to payment.

Examples of Holder

  1. John is the holder of a check for $500. He is entitled to receive payment from the bank when he presents the check for cashing.
  2. Sarah bought a promissory note from Tom, making her a holder in due course. She can now legally demand payment from the debtor.
  3. The original owner of a stock certificate may transfer ownership to another person, but the holder of the certificate is the person who possesses it.

Legal Terms Similar to Holder

  1. Owner - A person who has legal title to a property.
  2. Payee - A person who is entitled to receive payment from a financial instrument.
  3. Endorser - A person who signs a financial instrument, such as a check, to transfer ownership to another person.