Ky. Rev. Stat. » Chapter 355
Kentucky Revised Statutes

Ky. Rev. Stat. § 355.3-202 (2026)

Negotiation subject to rescission

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(1) Negotiation is effective even if obtained:

(a) From an infant, a corporation exceeding its powers, or a person without capacity;

(b) By fraud, duress, or mistake; or

(c) In breach of duty or as part of an illegal transaction. (2) To the extent permitted by other law, negotiation may be rescinded or may be subject to other remedies, but those remedies may not be asserted against a subsequent holder in due course or a person paying the instrument in good faith and without knowledge of facts that are a basis for rescission or other remedy. Effective: January 1, 1997 History: Repealed and reenacted 1996 Ky. Acts ch. 130, sec. 21, effective January 1, 1997. -- Created 1958 Ky. Acts ch. 77, sec. 3-202, effective July 1, 1960.

Notes of Decisions
Cited in 2 cases, 1981–1993 · leading case: Frazier v. Commonwealth, 613 S.W.2d 423 (Ky. 1981).
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Frazier v. Commonwealth, 613 S.W.2d 423 (Ky. 1981). “KRS 355.3-202. On either basis, an endorsement falls within the categories of instruments specified in KRS 516.”
J.P. Morgan Delaware v. Onyx Arabians II, Ltd., 825 F. Supp. 146 (W.D. Ky. 1993). “KRS 355.3-202(1). Lasma II had the specifically enforceable right to have the endorsement of Lasma I and had Lasma II enforced that right, negotiation would have taken place at the time of the endorsement.”
Ky. Rev. Stat. § 355.3-202(1): 1 case
J.P. Morgan Delaware v. Onyx Arabians II, Ltd., 825 F. Supp. 146 (W.D. Ky. 1993). “KRS 355.3-202(1). Lasma II had the specifically enforceable right to have the endorsement of Lasma I and had Lasma II enforced that right, negotiation would have taken place at the time of the endorsement.”
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