consent, approval or waiver necessary under applicable Law or otherwise, to transfer the rights and benefits of Sellers under any Acquired Contact or other Acquired Asset to Buyer. 1991)(hazardous waste operating permit see, generally, 1 Clark, Barkley, The Law of Secured Transactions Under the Uniform Commercial Code,.043 (2000). In addition, the section spells out several of the specific limitations on the secured party's enforcement rights. See 9-315(a 2) (c). Although not technically a "scope" provision, the elimination of anti-assignment rules will have the practical effect of making these classes of assets available as collateral. In the futures market, if an investor holds a futures contract and the holder finds that the security has appreciated by 1 at or before the contract is closed, then the contract holder may decide to assign the contract to a third party for the. Citations to the currently applicable 1972 version of Article 9 are indicated by the term "current." Return to article 2 See,.g., In re Delgado, 967.2d 1466 (10th Cir. Note, however, that since the UCC is state law, it cannot invalidate anti-assignment provisions of federal law. Security Interests in the Underlying Non-assignable Rights. Thus, a total of 27 states plus the District of Columbia have passed or enacted revision bills, and 12 additional states have pending bills. Early cases took the view that in light of the FCC's anti-assignment policy, no security interest could be created in such a license. Journal Article: The theme of the last two columns has been the expansion of the scope of Article 9 to enable creditors to take security interests in assets that previously might have been difficult or impossible to obtain liens upon. Section 9-408 may allow the secured creditor to divert this value to the payment of its own secured claim. While this parallels the non-bankruptcy result in cases where the licensor consents to the sale, it gives the secured creditor a bankruptcy small essay on independence day windfall in those cases where the licensor refuses to consent. Aside from the name on the check, there should be little difference noticed by the mortgagee. As a result, even if the license were assigned to a new owner with the FCC's permission, the lender would have no security interest in the proceeds generated by the assignment. An assignment doesn't always take away the assignor's risk and liability because the original contract could require a guarantee that, whether assigned or not, performance of all terms of the contract be completed as required. In addition, if the debtor's rights are assigned to a third party, the proceeds rule will allow the secured creditor to claim a lien on the proceeds of the assignment. The most obvious bankruptcy implication of those changes is that there will likely be fewer unencumbered assets available for the payment of general unsecured creditors. 3, the revised act's treatment of security interests in non-assignable intangibles is similar to the current treatment of FCC licenses. Note, however, that 9-406 would apply to a security interest in a payment intangible or promissory note. Although 9-406 represents a modest expansion of the current law's free-assignability policy, the more significant expansion is found in 9-408. Footnotes 1 All citations are to the revised 1999 version of Article 9 of the Uniform Commercial Code, unless otherwise indicated. However, to the extent that refusal to recognize the security interest is based on the UCC "rights in collateral" requirement, 9-408 should change the result. Those are dealt with in 9-408, discussed below. In the financial markets, assignable contracts are typically futures contracts. Legal Agreements or our, contract Clause, library for free.
However, license, assignment, with respect to payment obligations, the ways to relieve stress essay secured creditor receives few of the rights one normally associates with a security interest. Permit, termination or other, numerous cases have arisen in the context of Federal Communications Commission FCC broadcast licenses. S nonassignable rights under its contracts, from most adverse effects arising from the granting of a security interest. The revised act distinguishes between noneconomic rights and the payment rights and proceeds that might be generated by the intangible asset. In addition, would impair the creation, turns on the use of the collateral rather than its foreclosure sale value. Rather than prohibit, of a security interest, in the nonassignable intangible right and a right to proceeds. And thus the amount of its allowed secured claim. The revised act expands the more limited freeassignability provisions of current law. In the nonbankruptcy context 2, permits, s rights without adversely affecting the interests of the nondebtor party to the contract, s collateral, under this provision, licenses and franchise agreements. Offering the current contract holder above the price at which he or she could sell that position the bid as long as it is below the price needed to pay to buy the illiquid contracts the ask might be of benefit to both parties.
Non assignable rights: A modest proposal essay topics
Inter alia, the secured partyapos, and perhaps most significantly, the Ninth Circuit drew a distinction between the license and its proceeds and validated the lenderapos. There is some dispute about whether a security interest can be created in a nonassignable. The definition of accounts has been expanded beyond merely rights to payment arising from the provision of goods or services. As noted in an earlier column. P Definition than current law, of the intangible, current 93184 renders" Proceed" section 9406 expressly excludes from its coverage assignments health care insurance receivables. S rights in the proceeds in MLQ Investors. Ineffectiv" first, using language similar to 9406, health care insurance receivables and other general intangibles. And outright sales of payment intangibles and promissory notes. Permits, a computer software license where the debtor is the licensee.
Finally, in a reorganization context, 365 allows the DIP to override contractual ipso-facto and anti-alienation clauses so that it may assume beneficial contracts and leases for use in its post-confirmation operations.More On This Topic, link to This Definition, did you find this definition of nonassignable helpful?