Article 59 - Rights of assignees
(1) In this Article, "assignee" includes a
Secured Party and an administrator.
(2) Unless an
Account Debtor has made an enforceable agreement not to assert defences to claims arising out of a contract, the rights of an assignee of the Account are subject to:
(A) the terms of the contract between the
Account Debtor and the assignor and any defence or claim arising from the contract or a closely connected contract; and
(B) any other defence or claim of the
Account Debtor against the assignor which accrues before the Account Debtor acquires knowledge of the assignment.
(3) Subject to paragraph (4), if
Collateral which is an Account is assigned, the Account Debtor may make payments under the contract to the assignor until, but not after, the Account Debtor receives a notice that:
(A) states that the amount payable or to become payable under the contract has been assigned and that payment is to be made to the assignee; and
(B) identifies the contract under which the amount payable is to become payable.
(4) If the
Account Debtor reasonably requests the assignee to supply proof of the assignment, the Account Debtor may continue to make payments under the contract to the assignor until the assignee supplies reasonable proof of the assignment.
(5) Payment by an
Account Debtor to an assignee under a notice mentioned in paragraph (3) discharges the obligation of the Account Debtor to the extent of the payment.
(6) A term in a contract between an
Account Debtor and an assignor which prohibits or restricts assignment of, or the giving of a Security Interest in, the whole of the Account or Chattel Paper for Money due or to become due or that requires the Account Debtor's consent to such assignment or such giving of a Security Interest:
(A) is binding on the assignor only to the extent of making the assignor liable to the
Account Debtor in damages for breach of contract; and
(B) is unenforceable against third parties.