{"data":{"id":"us-ok/okla.-stat.-tit.-12a-12a-1-9-406","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 12A, § 12A-1-9-406","heading":"Discharge of account debtor; notification of","body":"assignment; identification and proof of assignment; restrictions on\n\nassignment of accounts, chattel paper, payment intangibles, and\n\npromissory notes ineffective.\n\nDISCHARGE OF ACCOUNT DEBTOR; NOTIFICATION OF ASSIGNMENT;\n\nIDENTIFICATION AND PROOF OF ASSIGNMENT; RESTRICTIONS ON\n\nASSIGNMENT OF ACCOUNTS, CHATTEL PAPER, PAYMENT\n\nINTANGIBLES, AND PROMISSORY NOTES INEFFECTIVE\n\n(a) Subject to subsections (b) through (k) of this section, an\n\naccount debtor on an account, chattel paper, or a payment intangible\n\nmay discharge its obligation by paying the assignor until, but not\n\nafter, the account debtor receives a notification, signed by the\n\nassignor or the assignee, that the amount due or to become due has\n\nbeen assigned and that payment is to be made to the assignee. After\n\nreceipt of the notification, the account debtor may discharge its\n\nobligation by paying the assignee and may not discharge the\n\nobligation by paying the assignor.\n\n(b) Subject to subsections (h) and (k) of this section,\n\nnotification is ineffective under subsection (a) of this section:\n\n(1) if it does not reasonably identify the rights assigned;\n\n(2) to the extent that an agreement between an account debtor\n\nand a seller of a payment intangible limits the account debtor's\n\nduty to pay a person other than the seller and the limitation is\n\neffective under law other than this article; or\n\n(3) at the option of an account debtor, if the notification\n\nnotifies the account debtor to make less than the full amount of any\n\ninstallment or other periodic payment to the assignee, even if:\n\n(A) only a portion of the account, chattel paper, or\n\ngeneral intangible has been assigned to that assignee;\n\n(B) a portion has been assigned to another assignee; or\n\n(C) the account debtor knows that the assignment to that\n\nassignee is limited.\n\n(c) Subject to subsections (h) and (k) of this section, if\n\nrequested by the account debtor, an assignee shall seasonably\n\nfurnish reasonable proof that the assignment has been made. Unless\n\nthe assignee complies, the account debtor may discharge its\n\nobligation by paying the assignor, even if the account debtor has\n\nreceived a notification under subsection (a) of this section.\n\n(d) (1) In this subsection, \"promissory note\" includes a\n\nnegotiable instrument that evidences chattel paper. Except as\n\notherwise provided in paragraph (2) of this subsection and\n\nsubsections (e) and (j) of this section and Sections 2A-303 and 1-9-\n\n407 of this title, and subject to subsection (h) of this section, a\n\nterm in an agreement between an account debtor and an assignor or in\n\na promissory note is ineffective to the extent that it:\n\n(A) prohibits, restricts, or requires the consent of the\n\naccount debtor or person obligated on the promissory\n\nnote to the assignment or transfer of, or the\n\ncreation, attachment, perfection, or enforcement of a\n\nsecurity interest in, the account, chattel paper,\n\npayment intangible, or promissory note; or\n\n(B) provides that the assignment or transfer or the\n\ncreation, attachment, perfection, or enforcement of\n\nthe security interest may give rise to a default,\n\nbreach, right of recoupment, claim, defense,\n\ntermination, right of termination, or remedy under the\n\naccount, chattel paper, payment intangible, or\n\npromissory note.\n\n(2) This subsection does not apply to the assignment or\n\ntransfer of or creation of a security interest in the following:\n\n(A) a claim or right to receive compensation for injuries\n\nor sickness as described in 26 U.S.C., Section 104\nbreach, right of recoupment, claim, defense,\n\ntermination, right of termination, or remedy under the\n\naccount, chattel paper, payment intangible, or\n\npromissory note.\n\n(2) This subsection does not apply to the assignment or\n\ntransfer of or creation of a security interest in the following:\n\n(A) a claim or right to receive compensation for injuries\n\nor sickness as described in 26 U.S.C., Section 104\n\n(a)(1) or (2), as amended from time to time;\n\n(B) a claim or right to receive benefits under a special\n\nneeds trust as described in 42 U.S.C., Section\n\n1396p(d)(4), as amended from time to time; or\n\n(C) a structured settlement payment right as defined in\n\nparagraph 16 of Section 3239 of Title 12 of the\n\nOklahoma Statutes to the extent of any conflict\n\nbetween the Uniform Commercial Code and the Structured\n\nSettlement Protection Act of 2001.\n\n(e) Subsection (d) of this section does not apply to the sale\n\nof a payment intangible or promissory note, other than a sale\n\npursuant to a disposition under Section 1-9-610 of this title or an\n\nacceptance of collateral under Section 1-9-620 of this title.\n\n(f) Except as otherwise provided in subsection (j) of this\n\nsection and Sections 2A-303 and 1-9-407 of this title and subject to\n\nsubsections (h) and (i) of this section, a rule of law, statute, or\n\nregulation, that prohibits, restricts, or requires the consent of a\n\ngovernment, governmental body or official, or account debtor to the\n\nassignment or transfer of, or creation of a security interest in, an\n\naccount or chattel paper is ineffective to the extent that the rule\n\nof law, statute, or regulation:\n\n(1) prohibits, restricts, or requires the consent of the\n\ngovernment, governmental body or official, or account debtor to the\n\nassignment or transfer of, or the creation, attachment, perfection,\n\nor enforcement of a security interest in, the account or chattel\n\npaper; or\n\n(2) provides that the assignment or transfer or the creation,\n\nattachment, perfection, or enforcement of the security interest may\n\ngive rise to a default, breach, right of recoupment, claim, defense,\n\ntermination, right of termination, or remedy under the account or\n\nchattel paper.\n\n(g) Subject to subsections (h) and (k) of this section, an\n\naccount debtor may not waive or vary its option under paragraph (3)\n\nof subsection (b) of this section.\n\n(h) This section is subject to law other than this article\n\nwhich establishes a different rule for an account debtor who is an\n\nindividual and who incurred the obligation primarily for personal,\n\nfamily, or household purposes.\n\n(i) This section does not apply to an assignment of a health-\n\ncare-insurance receivable.\n\n(j) Subsections (d) and (f) of this section do not apply to a\n\nsecurity interest in an ownership interest in a general partnership,\n\nlimited partnership, or limited liability company.\n\n(k) Subsections (a), (b), (c), and (g) of this section do not\n\napply to a controllable account or controllable payment intangible.","path":["OK Code","Title 12A"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os12A.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"905c5a3ca068563ff0b050ab952b31307829b9f0d84c055808be1636a5982b3b","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-12a-12a-1-9-405","next":"us-ok/okla.-stat.-tit.-12a-12a-1-9-407"},"notice":"GroundRules: Original legal text. Not legal advice."}