Section 28:9-206 - Agreement not to assert defenses against assignee; modification of sales warranties where security agreement exists

Agreement not to assert defenses against assignee; modification of sales warranties where security agreement exists

(1) Subject to any statute or decision which establishes a different rule for buyers or lessees of consumer goods, an agreement by a buyer or lessee that he will not assert against an assignee any claim or defense which he may have against the seller or lessor is enforceable by an assignee who takes his assignment for value, in good faith and without notice of a claim or defense, except as to defenses of a type which may be asserted against a holder in due course of a negotiable instrument under the article on commercial paper (article 3). A buyer who as part of one transaction signs both a negotiable instrument and a security agreement makes such an agreement.

(2) When a seller retains a purchase money security interest in goods the article on sales (article 2) governs the sale and any disclaimer, limitation or modification of the seller's warranties.

CREDIT(S)

(Dec. 30, 1963, 77 Stat. 752, Pub. L. 88-243, § 1.)

HISTORICAL AND STATUTORY NOTES

Prior Codifications
1981 Ed., § 28:9-206.
1973 Ed., § 28:9-206.
Legislative History of Laws
For Law 13-201, see notes following § 28:9-101.

Current through September 13, 2012