[First Reprint]

ASSEMBLY, No. 2321

STATE OF NEW JERSEY

INTRODUCED SEPTEMBER 16, 1996

By Assemblymen AUGUSTINE and WEINGARTEN

An Act concerning the assignment of certain mortgages and amending R.S.46:9-9.

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

    1. R.S.46:9-9 is amended to read as follows:

    46:9-9. All mortgages on real estate in this State, and all covenants and stipulations therein contained, shall be assignable at law by writing, whether sealed or not, and any such assignment shall pass and convey the estate of the assignor in the mortgaged premises, and the assignee may sue thereon in his own name, but, in any such action by the assignee, there shall be allowed all just set-offs and other defenses against the assignor that would have been allowed in any action brought by the assignor and existing before notice of such assignment, except that, when the underlying mortgage is evidenced by an instrument meeting the criteria for negotiability set forth in N.J.S.12A:3-104, ¹and the instrument is issued and negotiated to the holder and the holder takes the instrument pursuant to the provisions of N.J.S.12A:3-302,¹ the holder of the instrument shall be a holder in due course and shall be afforded all the rights and protections provided a holder in due course ¹[ pursuant to N.J.S.12A:3-302]¹ .

(cf: P.L.1987, c.357, s.4) 

    2. This act shall take effect immediately.

Provides holder in due course status to holders of negotiable instruments secured by a mortgage.