Iowa Code 554.9403 – Agreement not to assert defenses against assignee
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Terms Used In Iowa Code 554.9403
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- person: means individual, corporation, limited liability company, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, or any other legal entity. See Iowa Code 4.1
- property: includes personal and real property. See Iowa Code 4.1
- Rule: includes "regulation". See Iowa Code 4.1
554.9403 Agreement not to assert defenses against assignee.
1. Value. In this section, “”value”” has the meaning provided in § 554.3303, subsection 1.
2. Agreement not to assert claim or defense. Except as otherwise provided in this section, an agreement between an account debtor and an assignor not to assert against an assignee any claim or defense that the account debtor may have 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 asserted
against a person entitled to enforce a negotiable instrument under § 554.3305,
subsection 1.
3. When subsection 2 not applicable. Subsection 2 does not apply to defenses of a type
that may be asserted against a holder in due course of a negotiable instrument under section
554.3305, subsection 2.
4. Omission of required statement in consumer transaction. In a consumer transaction,
if a record evidences the account debtor’s obligation, law other than this Article requires that
the record include a statement to the effect that the rights of an assignee are subject to claims
or defenses that the account debtor could assert against the original obligee, 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 that would
have been available if the record included such a statement.
5. Rule for individual under other law. This section is subject to law other than this Article
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.
6. Other law not displaced. Except as otherwise provided in subsection 4, this section
does not displace law other than this Article which gives effect to an agreement by an account
debtor not to assert a claim or defense against an assignee.
2000 Acts, ch 1149, §65, 185, 187
1. Value. In this section, “”value”” has the meaning provided in § 554.3303, subsection 1.
2. Agreement not to assert claim or defense. Except as otherwise provided in this section, an agreement between an account debtor and an assignor not to assert against an assignee any claim or defense that the account debtor may have 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 asserted
against a person entitled to enforce a negotiable instrument under § 554.3305,
subsection 1.
3. When subsection 2 not applicable. Subsection 2 does not apply to defenses of a type
that may be asserted against a holder in due course of a negotiable instrument under section
554.3305, subsection 2.
4. Omission of required statement in consumer transaction. In a consumer transaction,
if a record evidences the account debtor’s obligation, law other than this Article requires that
the record include a statement to the effect that the rights of an assignee are subject to claims
or defenses that the account debtor could assert against the original obligee, 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 that would
have been available if the record included such a statement.
5. Rule for individual under other law. This section is subject to law other than this Article
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.
6. Other law not displaced. Except as otherwise provided in subsection 4, this section
does not displace law other than this Article which gives effect to an agreement by an account
debtor not to assert a claim or defense against an assignee.
2000 Acts, ch 1149, §65, 185, 187