Cap. t4:35
Movnrm Pnornnrr Srcurury lursnnsrs
No.9l20L7
(2) Notification of a security interest in a receivable nny relate to receivables
arising after notifi cation.
(3) Until the obligorof the receivable receiyes notification of a security interest
it is discharged by payrng it in accordance with the original contract;
whercafter if the obligor of the receivable receives notifcation of a security intercst
in a raeivable, it is dischaqged only by paylng the secured creditor; unless odrcnvise
instnrcted in t$e notifcation or subsequendy by the secured creditor in writing received
by the obligor of the receivable.
in
a receivable,
(4) Ifthe obligorofthe receivable receives notificationof more thanore secwity
interest in the sams receivable created by ttrc same debtor, it is discharged by payrng
it in accordance with the first notification received-
(5) The obligor of the receivable is entitled to request the secured creditor to
prcvide him orher, within a reasonable period of time, adequate prcof that the security
intercst in a receivable has been created.
(6) Until the secured crcditor complies with subparagraph (5), the obligor of
the receivable may discharge his or her obligation by payrng the debtor, even if the
obligor of the receivable has received a notificatiou of a security intereet.
Deferces and rights of set-offaf obligor of rcceivable
25 . ( I ) In a claim by the secured creditor against the obligor of the receivable for
payment of the €ncumberd receivable, the obligor of the receivable may raise against
the secured creditor-
(a)
all defences and rights of set-olf arising from the mntract gviog rise to
the receivable,or any otherc,ontract that waspart of the same transaction,
of which the obligor of the receivable could avail hiurself or herself as
if the security interest had not been created and the claim were made by
the debtor; and
(b)
any dher right of set-offtlat was available to the obligor of the receivable
at the time it received notification of the security interest.
(2) Notwithstandingsu@aragr4h (l),theobligorof thercceivable rnaynotraise
a defence or right of set-off based upon the detfior's brmch of an agreerpnt refened to
in paragraph 4 limiting in any way the debtor's right to create the security interest.
(3) The obligc of the rcceivable may agree with the debtorin a sigred agreernent
not to raise against the secured creditor the defences and rights of set-off rpferred to in
subparagraph (l),
(4) The obligor of the receivable may m waive defences arising from fraudulent
acts on the part of the secured creditor or based on his o'r her own incapacity.
Modifuation of original agrcerrznt
?-6.
An agreement concluded before notffication of a security interest in a
receivable created by a security agreement between the detts and the obligor of the
receivable that affects the secured creditor's rights is effective as against the securEd
credittr, and the secured creditor acquires corresponding rights.
Entitlemcnt
n dunagesfor
breach of obligation
n.Q) If a person fails to discharge any &ty or obligation imposed by this
Act, the per$on to wtrom,the duty or obligation is owed or any other person who can
reasonably be expected to rely on performance of the duty or obligation shall have a
right to recover damages for any loss or damage that was reasonably foreseeable as
likelv to result from the failure.
17l
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