Tennessee Code Annotated
Tenn. Code Ann. § 47-3-303 (2026)
Value and consideration
✓ current as of May 2026
- (a) An instrument is issued or transferred for value if:
- (1) the instrument is issued or transferred for a promise of performance, to the extent the promise has been performed;
- (2) the transferee acquires a security interest or other lien in the instrument other than a lien obtained by judicial proceeding;
- (3) the instrument is issued or transferred as payment of, or as security for, an antecedent claim against any person, whether or not the claim is due;
- (4) the instrument is issued or transferred in exchange for a negotiable instrument; or
- (5) the instrument is issued or transferred in exchange for the incurring of an irrevocable obligation to a third party by the person taking the instrument.
- (b) "Consideration" means any consideration sufficient to support a simple contract. The drawer or maker of an instrument has a defense if the instrument is issued without consideration. If an instrument is issued for a promise of performance, the issuer has a defense to the extent performance of the promise is due and the promise has not been performed. If an instrument is issued for value as stated in subsection (a), the instrument is also issued for consideration.
Acts 1995, ch. 397, § 2.
Notes of Decisions
Cited in 5
cases (1 in the last 5 years), 1973–2023 · leading case: McConnico v. Third Nat'l Bank in Nashville, 499 S.W.2d 874 (Tenn. 1973).
McConnico v. Third Nat'l Bank in Nashville, 499 S.W.2d 874 (Tenn. 1973). “§ 3-303(1) and T.C.A. § 47-3-303(1) provide that a holder takes an instrument for value to the extent that he acquires a security interest in or lien on the instrument other than by legal process.”
Third Nat. Bk., Nashville v. Hardi-Gardens Sup. of Ill., Inc., 380 F. Supp. 930 (M.D. Tenn. 1974). “Value T.C.A. § 47-3-303 states: A holder takes the instrument for value: (a) to the extent that the agreed consideration has been performed or that he acquires a security interest in or a lien on the instrument otherwise than by legal process, (b) when he takes the instrument in…”
Laxmi Hosp. Grp., LLC v. Rajesh Narayan (Tenn. Ct. App. 2018). “Citing Tenn. Code Ann. § 47-3-303 , the court found that Mr.”
Doug Goodman v. Com. Bank & Trust Co., 72 F.4th 122 (6th Cir. 2023). “Tenn. Code Ann. § 47-3-303 (a). None of these circumstances are present here.”
State Resources Corp. v. Thomas E. Talley (Tenn. Ct. App. 2004). “(d) If, under § 47-3-303(a) (1), the promise of performance that is the consideration for an instrument has been partially performed, the holder may assert rights as a holder in due course of the instrument -4- only to the fraction of the amount payable under the instrument…”
— Tenn. Code Ann. § 47-3-303(1) — 1 case
McConnico v. Third Nat'l Bank in Nashville, 499 S.W.2d 874 (Tenn. 1973). “§ 3-303(1) and T.C.A. § 47-3-303(1) provide that a holder takes an instrument for value to the extent that he acquires a security interest in or lien on the instrument other than by legal process.”
— Tenn. Code Ann. § 47-3-303(a) — 1 case
State Resources Corp. v. Thomas E. Talley (Tenn. Ct. App. 2004). “(d) If, under § 47-3-303(a) (1), the promise of performance that is the consideration for an instrument has been partially performed, the holder may assert rights as a holder in due course of the instrument -4- only to the fraction of the amount payable under the instrument…”
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