47-1202

47-1202. Notice; knowledge

A. Subject to subsection F, a person has "notice" of a fact if the person:

1. Has actual knowledge of it;

2. Has received a notice or notification of it; or

3. From all the facts and circumstances known to the person at the time in
question, has reason to know that it exists.

B. "Knowledge" means actual knowledge. "Knows" has a corresponding meaning.

c. "Discover", "learn" or words of similar import refer to knowledge rather than to
reason to know.

D. A person "notifies" or "gives" a notice or notification to another person by
taking such steps as may be reasonably required to inform the other person in ordinary
course, whether or not the other person actually comes to know of it.

E. Subject to subsection F, a person "receives" a notice or notification when:

1. It comes to that person's attention; or

2. It is duly delivered in a form reasonable under the circumstances at the place
of business through which the contract was made or at another location held out by that
person as the place for receipt of such communications.

F. Notice, knowledge or a notice or notification received by an organization is
effective for a particular transaction from the time it is brought to the attention of
the individual conducting that transaction and, in any event, from the time it would have
been brought to the individual's attention if the organization had exercised due
diligence. An organization exercises due diligence if it maintains reasonable routines
for communicating significant information to the person conducting the transaction and
there is reasonable compliance with the routines. Due diligence does not require an
individual acting for the organization to communicate information unless the
communication is part of the individual's regular duties or the individual has reason to
know of the transaction and that the transaction would be materially affected by the
information.