After years of writhing agony at the hands of courts and legislatures, one of the most venerable of legal rules has bitten the dust, and it happened right here in Washington, D.C. The victim is the holder in due course rule as it applies to consumer credit transactions. The slayer is neither the Supreme Court nor the Congress but the oft-maligned Federal Trade Commission. The seismic event occurred just before Thanksgiving of 1975 when the commission issued its final version of a trade regulation rule entitled "Preservation of Consumers' Claims and Defenses." The rule was officially promulgated on November 14, 1975, and may be found beginning on page 53505 of the Federal Register for November 18. Its effective date will be May 14, 1976.
Ralph J. Rohner, The F.T.C. Does Lord Mansfield In, 62 A.B.A. J. 372 (1976).