§ 9-406. Discharge of account debtor; notification of assignment; identification and proof of a...
West's Annotated Code of MarylandCommercial LawEffective: July 1, 2013
Effective: July 1, 2013
MD Code, Commercial Law, § 9-406
§ 9-406. Discharge of account debtor; notification of assignment; identification and proof of assignment; term prohibiting assignment ineffective
(a) Subject to subsections (b) through (j), 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.
(c) Subject to subsection (h), if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under subsection (a).
(1) Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or
(2) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.
(f) Except as otherwise provided in §§ 2A-303 of this article and 9-407, and subject to subsections (h) and (i) of this section, a rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation:
Credits
Added by Acts 1999, c. 282, § 2, eff. July 1, 2001. Amended by Acts 2001, c. 408, § 2, eff. July 1, 2001; Acts 2002, c. 477, § 1, eff. Oct. 1, 2002; Acts 2012, c. 674, § 2, eff. July 1, 2013.
MD Code, Commercial Law, § 9-406, MD COML § 9-406
Current through legislation effective through April 9, 2023, from the 2024 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
End of Document |