§490:9-406  Discharge of account debtor;
notification of assignment; identification and proof of assignment;
restrictions on assignment of accounts, chattel paper, payment intangibles, and
promissory notes ineffective.  (a)  Subject to subsections (b) through (i),
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.



(b)  Subject to subsection (h), notification is
ineffective under subsection (a):



(1)  If it does not reasonably identify the rights
assigned;



(2)  To the extent that an agreement between an
account debtor and a seller of a payment intangible limits the account debtor's
duty to pay a person other than the seller and the limitation is effective
under law other than this article; or



(3)  At the option of an account debtor, if the
notification notifies the account debtor to make less than the full amount of
any installment or other periodic payment to the assignee, even if:



(A)  Only a portion of the account, chattel
paper, or payment intangible has been assigned to that assignee;



(B)  A portion has been assigned to another
assignee; or



(C)  The account debtor knows that the
assignment to that assignee is limited.



(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).



(d)  Except as otherwise provided in subsection
(e) and sections 490:2A-303 and 490:9-407, and subject to subsection (h), a
term in an agreement between an account debtor and an assignor or in a
promissory note is ineffective to the extent that it:



(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.



(e)  Subsection (d) does not apply to the sale
of a payment intangible or promissory note.



(f)  Except as otherwise provided in sections
490:2A-303 and 490:9-407, and subject to subsections (h) and (i), 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:



(1)  Prohibits, restricts, or requires the consent of
the government, governmental body or official, or account debtor to the
assignment or transfer of, or the creation, attachment, perfection, or
enforcement of a security interest in, the account or chattel paper; 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 or chattel
paper.



(g)  Subject to subsection (h), an account
debtor may not waive or vary its option under subsection (b)(3).



(h)  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.



(i)  This section does not apply to an
assignment of a health-care-insurance receivable. [L 2000, c 241, pt of §1; am
L 2001, c 228, §5]