400.9-405. Modification of assigned contract.
Modification of assigned contract.
400.9-405. (a) A modification of or substitution for an assignedcontract is effective against an assignee if made in good faith. The assigneeacquires corresponding rights under the modified or substituted contract. Theassignment may provide that the modification or substitution is a breach ofcontract by the assignor. This subsection is subject to subsections (b)through (d).
(b) Subsection (a) applies to the extent that:
(1) The right to payment or a part thereof under an assigned contracthas not been fully earned by performance; or
(2) The right to payment or a part thereof has been fully earned byperformance and the account debtor has not received notification of theassignment under section 400.9-406(a).
(c) This section is subject to law other than this article whichestablishes a different rule for an account debtor who is an individual andwho incurred the obligation primarily for personal, family, or householdpurposes.
(d) This section does not apply to an assignment of ahealth-care-insurance receivable.
(L. 1963 p. 503 § 9-405, A.L. 1965 p. 595, A.L. 1978 S.B. 755, A.L. 1988 S.B. 583, A.L. 2001 S.B. 288)Effective 7-01-01