## Facts

- Robert C. Rice loaned money to Marie Hunt, who executed a promissory note in the face amount of $35,000, due in May 2001 with interest.
- As security for the note, Hunt granted Rice a mortgage on certain residential real property.
- Rice later assigned the note and mortgage to NationsCredit Financial Services Corporation (NationsCredit).
- Hunt did not fully pay the note by the May 2001 maturity date.
- NationsCredit declared Hunt in default, foreclosed on the mortgage, and sold the property at foreclosure to a third party for $28,000.
- Hunt sued NationsCredit seeking an accounting and a declaration that the foreclosure sale was invalid.
- Hunt alleged she received only $23,354.87 (not $35,000) and claimed she repaid all amounts she actually received.
- In response, NationsCredit presented evidence that it took the note as a holder in due course.
- Hunt asserted defenses including partial failure of consideration and lack of mutual assent as to the amount of the loan.
- The trial court granted NationsCredit’s motion for summary judgment, and Hunt appealed.

## Issues

1. Whether NationsCredit established that it was a holder in due course of Hunt’s promissory note.
2. Whether Hunt’s asserted defenses—partial failure of consideration and lack of mutual assent regarding the loan amount—could be asserted against NationsCredit to avoid enforcement of the note.
3. Whether Hunt’s challenge to the foreclosure sale could survive summary judgment given NationsCredit’s claimed holder-in-due-course status.

## Decision

- The court affirmed summary judgment for NationsCredit.
- The court held that NationsCredit’s holder-in-due-course showing entitled it to enforce the note according to its terms.
- The court concluded Hunt’s defenses did not create a genuine dispute of material fact sufficient to defeat summary judgment against a holder in due course.
- Because NationsCredit was entitled to enforce the debt obligation, Hunt’s request to set aside the foreclosure likewise failed on summary judgment.

## Legal Principles

- A holder in due course is a holder who takes a negotiable instrument for value, in good faith, and without notice of claims or defenses.
- A holder in due course takes the instrument free of many “personal” defenses that could be asserted against the original payee, including defenses such as failure (or partial failure) of consideration and similar contract-based defenses.
- To defeat a holder-in-due-course claim at the summary-judgment stage, the maker must present evidence creating a triable issue that the transferee lacked good faith or had notice of a defense or claim.
- Summary judgment is proper when the movant makes a prima facie showing and the nonmovant fails to present substantial evidence creating a genuine issue of material fact.
- When the note is enforceable according to its terms and the borrower is in default, the mortgagee’s foreclosure based on that default is not invalidated by defenses that are ineffective against a holder in due course.

## Conclusion

The court affirmed summary judgment for NationsCredit, holding that NationsCredit established holder-in-due-course status and therefore could enforce the promissory note as written; Hunt’s partial-failure-of-consideration and lack-of-mutual-assent defenses did not bar enforcement against a holder in due course, and her related effort to invalidate the foreclosure sale failed as a matter of law.


Hunt v. NationsCredit Financial Services Corp., 902 So. 2d 75 (2003)