70A-9a-403 - Agreement not to assert defenses against assignee.
70A-9a-403. Agreement not to assert defenses against assignee.
(1) In this section, "value" has the meaning provided in Subsection 70A-3-303(1).
(2) Except as otherwise provided in this section, an agreement between an account debtorand an assignor not to assert against an assignee any claim or defense that the account debtor mayhave against the assignor is enforceable by an assignee that takes an assignment:
(a) for value;
(b) in good faith;
(c) without notice of a claim of a property or possessory right to the property assigned;and
(d) without notice of a defense or claim in recoupment of the type that may be assertedagainst a person entitled to enforce a negotiable instrument under Subsection 70A-3-305(1).
(3) Subsection (2) does not apply to defenses of a type that may be asserted against aholder in due course of a negotiable instrument under Subsection 70A-3-305(2).
(4) In a consumer transaction, if a record evidences the account debtor's obligation, lawother than this chapter requires that the record include a statement to the effect that the rights of anassignee are subject to claims or defenses that the account debtor could assert against the originalobligee, and the record does not include such a statement:
(a) the record has the same effect as if the record included such a statement; and
(b) the account debtor may assert against an assignee those claims and defenses thatwould have been available if the record included such a statement.
(5) This section is subject to law other than this chapter which establishes a different rulefor an account debtor who is an individual and who incurred the obligation primarily for personal,family, or household purposes.
(6) Except as otherwise provided in Subsection (4), this section does not displace lawother than this chapter which gives effect to an agreement by an account debtor not to assert aclaim or defense against an assignee.
Enacted by Chapter 252, 2000 General Session