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Session Laws, 1999
Volume 796, Page 2097   View pdf image
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(B) SUBSECTION (A) APPLIES TO THE EXTENT THAT:

(1) THE RIGHT TO PAYMENT OR A PART THEREOF UNDER AN ASSIGNED
CONTRACT HAS NOT BEEN FULLY EARNED BY PERFORMANCE; OR

(2) THE RIGHT TO PAYMENT OR A PART THEREOF HAS BEEN FULLY
EARNED BY PERFORMANCE AND THE ACCOUNT DEBTOR HAS NOT RECEIVED
NOTIFICATION OF THE ASSIGNMENT UNDER § 9-406(A).

(C) THIS SECTION IS SUBJECT TO LAW OTHER THAN THIS TITLE WHICH
ESTABLISHES A DIFFERENT RULE FOR AN ACCOUNT DEBTOR WHO IS AN INDIVIDUAL
AND WHO INCURRED THE OBLIGATION PRIMARILY FOR PERSONAL, FAMILY, OR
HOUSEHOLD PURPOSES.

(D) THIS SECTION DOES NOT APPLY TO AN ASSIGNMENT OF A
HEALTH-CARE-INSURANCE RECEIVABLE.

9-406. DISCHARGE OF ACCOUNT DEBTOR; NOTIFICATION OF ASSIGNMENT;
IDENTIFICATION AND PROOF OF ASSIGNMENT; TERM PROHIBITING ASSIGNMENT
INEFFECTIVE.

(A) SUBJECT TO SUBSECTIONS (B) THROUGH (H), AN ACCOUNT DEBTOR ON AN
ACCOUNT, CHATTEL PAPER, OR A PAYMENT INTANGIBLE MAY DISCHARGE ITS
OBLIGATION BY PAYING THE ASSIGNOR UNTIL, BUT NOT AFTER, THE ACCOUNT
DEBTOR RECEIVES A NOTIFICATION, AUTHENTICATED BY THE ASSIGNOR OR THE
ASSIGNEE, THAT THE AMOUNT DUE OR TO BECOME DUE HAS BEEN ASSIGNED AND
THAT PAYMENT IS TO BE MADE TO THE ASSIGNEE. AFTER RECEIPT OF THE
NOTIFICATION, THE ACCOUNT DEBTOR MAY DISCHARGE ITS OBLIGATION BY PAYING
THE ASSIGNEE AND MAY NOT DISCHARGE THE OBLIGATION BY PAYING THE
ASSIGNOR

(B) SUBJECT TO SUBSECTION (G), NOTIFICATION IS INEFFECTIVE UNDER
SUBSECTION (A):

(1) IF IT DOES NOT REASONABLY IDENTIFY THE RIGHTS ASSIGNED;

(2) TO THE EXTENT THAT AN AGREEMENT BETWEEN AN ACCOUNT
DEBTOR AND A SELLER OF A PAYMENT INTANGIBLE LIMITS THE ACCOUNT DEBTOR'S
DUTY TO PAY A PERSON OTHER THAN THE SELLER AND THE LIMITATION IS
EFFECTIVE UNDER LAW OTHER THAN THIS ARTICLE; OR

(3) AT THE OPTION OF AN ACCOUNT DEBTOR, IF THE NOTIFICATION
NOTIFIES THE ACCOUNT DEBTOR TO MAKE LESS THAN THE FULL AMOUNT OF ANY
INSTALLMENT OR OTHER PERIODIC PAYMENT TO THE ASSIGNEE, EVEN IF:

(A) ONLY A PORTION OF THE ACCOUNT, CHATTEL PAPER, OR
GENERAL INTANGIBLE HAS BEEN ASSIGNED TO THAT ASSIGNEE;

(B) A PORTION HAS BEEN ASSIGNED TO ANOTHER ASSIGNEE; OR

(C) THE ACCOUNT DEBTOR KNOWS THAT THE ASSIGNMENT TO
THAT ASSIGNEE IS LIMITED.

 

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Session Laws, 1999
Volume 796, Page 2097   View pdf image
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