Negotiability lets good-faith buyers take title free of prior claims

Evidence

A negotiable instrument, when you transfer it legitimately, cuts off “equities” between the original parties. In other fields of law, a buyer of rights or goods steps into his seller’s shoes. A buyer of land is no better off than the seller. If there were claims, liens, or doubts about title that clouded the rights of the seller, they follow the land into the buyer’s hands and haunt him there. But a good-​faith buyer of a check (or a storekeeper who accepts a $10 bill) takes fresh, clear, virginal title. — Lawrence M. Friedman, A History of American Law, 1577

Categorization

• DEFINE: Defines negotiability precisely through contrast with land-law transfer.