KRS 355.3-308: Proof of signatures and status as holder in due course.

(1) In an action with respect to an instrument, the authenticity of, and authority to

make, each signature on the instrument is admitted unless specifically denied in the

pleadings. If the validity of a signature is denied in the pleadings, the burden of

establishing validity is on the person claiming validity, but the signature is

presumed to be authentic and authorized unless the action is to enforce the liability

of the purported signer and the signer is dead or incompetent at the time of trial of

the issue of validity of the signature. If an action to enforce the instrument is

brought against a person as the undisclosed principal of a person who signed the

instrument as a party to the instrument, the plaintiff has the burden of establishing

that the defendan t is liable on the instrument as a represented person under KRS

355.3-402(1).

(2) If the validity of signatures is admitted or proved and there is compliance with

subsection (1) of this section, a plaintiff producing the instrument is entitled to

payment i f the plaintiff proves entitlement to enforce the instrument under KRS

355.3-301, unless the defendant proves a defense or claim in recoupment. If a

defense or claim in recoupment is proved, the right to payment of the plaintiff is

subject to the defense o r claim, except to the extent the plaintiff proves that the

plaintiff has rights of a holder in due course which are not subject to the defense or

claim.