In regard to a "personal defense", which of the following statements is true?
1) It is one that arises out of the transaction that created the instrument and is generally based on the law of contracts. Payment is not a very important personal defense. Negligence reduces a real defense to a personal defense.
2) It is one that arises out of the transaction that created the instrument and is not generally based on the law of contracts. Payment is a very important personal defense. Negligence reduces a real defense to a personal defense.
3) It is one that arises out of the transaction that created the instrument and is generally based on the law of contracts. Payment is a very important personal defense. Negligence reduces a real defense to a personal defense.
4) It is one that arises out of the transaction that created the instrument and is generally based on the law of contracts. Payment is a very important personal defense. Negligence reduces a personal defense to a real defense.