Connecticut § 42-136 - Note or evidence of indebtedness given by buyer.

§ 42-136. Note or evidence of indebtedness given by buyer.

Sec. 42-136. Note or evidence of indebtedness given by buyer. (a) Any note or other evidence of indebtedness given by a buyer in respect of a home solicitation sale shall be dated not earlier than the date of the agreement or offer to purchase. Any transfer of a note or other evidence of indebtedness bearing the statement required by subsection (b) of this section shall be deemed an assignment only and any right, title or interest which the transferee may acquire thereby shall be subject to all claims and defenses of the buyer against the seller arising under the provisions of this chapter.

(b) Each note or other evidence of indebtedness given by a buyer in respect of a home solicitation sale shall bear on its face a conspicuous statement as follows: THIS INSTRUMENT IS BASED UPON A HOME SOLICITATION SALE, WHICH SALE IS SUBJECT TO THE PROVISIONS OF THE HOME SOLICITATION SALES ACT. THIS INSTRUMENT IS NOT NEGOTIABLE.

(c) Compliance with the requirements of this section shall be a condition precedent to any right of action by the seller or any transferee of an instrument bearing the statement required under subsection (b) of this section against the buyer upon such instrument and shall be pleaded and proved by any person who may institute action or suit against a buyer in respect thereof.

(d) A promissory note payable to order or bearer and otherwise negotiable in form issued in violation of this section may be enforced as a negotiable instrument by a holder in due course according to its terms.

(1967, P.A. 749, S. 5.)

Cited. 36 CS 213. Section does not require any specific size or boldness of type, indicating legislature did not establish any precise formula that would render a statement conspicuous. Id., 506.

Note made as evidence of indebtedness under a home solicitation sale contract was subject to defenses on the contract, hence when the contract was declared void, the note was uncollectible; transfer of note given by buyer in a home solicitation sale deemed an assignment; any rights, title or interest acquired by transferee are subject to all claims or defenses buyer may have against seller arising under the provisions of the act. 6 Conn. Cir. Ct. 745.

Subsec. (a):

Postdating of note not proscribed. 36 CS 506, 509.

Subsec. (b):

A conditional sales contract was not a “note or other evidence of indebtedness” and therefore notice requirements of statute were inapplicable. 36 CS 213. Language not subject to Uniform Commercial Code. Id., 506.