787. Misrepresentation as a defence against representor's assignee.

In certain cases where proof that a contract was induced by misrepresentation would have afforded a good defence to the representee1 in proceedings by the representor2, it may not be a sufficient defence in proceedings by an assignee of the representor, for example in a case where the representee has been induced to execute a negotiable instrument and is sued upon it by a holder in due course3. However, where a debt is not secured by a negotiable instrument, it seems that a representee sued for the debt by an assignee of the representor is entitled to set up

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