For purposes of determining its status as a holder in due course, a bank has given value to the extent it has a security interest in an item, if the bank otherwise complies with the requirements of Section 55-3-302 NMSA 1978 on what constitutes a holder in due course. History: 1953 Comp., § 50A-4-209, enacted by Laws 1961, ch. 96, § 4-209; 1978 Comp., § 55-4-209, recompiled as 1978 Comp., § 55-4-211 by Laws 1992, ch. 114, § 177. OFFICIAL COMMENTS UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved. The section completes the thought of the previous section and makes clear that a security interest in an item is "value" for the purpose of determining the holder's status as a holder in due course. The provision is in accord with the prior law (N.I.L. Section 27) and with Article 3 (Section 3-303) [55-3-303 NMSA 1978]. The section does not prescribe a security interest under Section 4-210 [55-4-210 NMSA 1978] as a test of "value" generally because the meaning of "value" under other Articles is adequately defined in Section 1-201 [55-1-201 NMSA 1978]. Repeals. — Laws 1992, ch. 114, § 237B repealed former 55-4-211 NMSA 1978, as enacted by Laws 1961, ch. 96, § 4-211, relating to media of remittance, effective July 1, 1992. For provisions of former section, see the 1991 NMSA 1978 on NMOneSource.com . The 1992 amendment, effective July 1, 1992, substituted "Section 55-3-302 NMSA 1978" for "Section 3-302" and made minor stylistic changes throughout the section. Am. Jur. 2d, A.L.R. and C.J.S. references. — 10 Am. Jur. 2d Banks § 694; 11 Am. Jur. 2d Bills and Notes §§ 337, 339. Crediting proceeds of negotiable paper to depositor's account, as constituting bank a holder in due course, 59 A.L.R.2d 1173. 9 C.J.S. Banks and Banking § 383 et seq.; 10 C.J.S. Bills and Notes §§ 185, 186.
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