Due Negotiation Law and Legal Definition

Due negotiation refers to a negotiation made after careful thought and deliberative consideration given to the matter at hand. A negotiable document of title is duly negotiated when it is negotiated to a holder who purchases it in good faith without notice of any defense against or claim to it on the part of any person and for value, unless it is established that the negotiation is not in the regular course of business or financing or involves receiving the document in settlement or payment of a money obligation.

A holder of a duly negotiated document acquires title to the document, title to the goods, all rights accruing under the law of agency or estoppel, and direct obligation of the issuer to hold or deliver the goods according to the terms of the document.