A is corrent. A debtor who does not have knowledge of a creditor’s assignment of his/her right to receive payment can extinguish all of his/her liability regarding the debt by paying the assignor. It is the duty of the assignee to notify the debtor of the assignment. In addition, an assignor who receives payment from the debtor after the assignment has occurred will always be liable to the assignee for payment received. In this case, since Baker paid the debt owed to Sable prior to receiving notice of the assignment, he/she has extinguished all liability on the debt. However, Sable is liable to Rich for payment received. Consequently, Rich is entitled to collect $50,000 from Sable only.
B is incorrect. A debtor who does not have knowledge of a creditor’s assignment of his/her right to receive payment can extinguish all of his/her liability regarding the debt by paying the assignor. It is the duty of the assignee to notify the debtor of the assignment. In addition, an assignor who receives payment from the debtor after the assignment has occurred will always be liable to the assignee for payment received. In this case, since Baker paid the debt owed to Sable prior to receiving notice of the assignment, he/she has extinguished all liability on the debt. However, Sable is liable to Rich for payment received. Consequently, Rich is entitled to collect $50,000 from Sable only.
B is incorrect. A debtor who does not have knowledge of a creditor’s assignment of his/her right to receive payment can extinguish all of his/her liability regarding the debt by paying the assignor. It is the duty of the assignee to notify the debtor of the assignment. In addition, an assignor who receives payment from the debtor after the assignment has occurred will always be liable to the assignee for payment received. In this case, since Baker paid the debt owed to Sable prior to receiving notice of the assignment, he/she has extinguished all liability on the debt. However, Sable is liable to Rich for payment received. Consequently, Rich is entitled to collect $50,000 from Sable only.
D is incorrect. A debtor who does not have knowledge of a creditor’s assignment of his/her right to receive payment can extinguish all of his/her liability regarding the debt by paying the assignor. It is the duty of the assignee to notify the debtor of the assignment. In addition, an assignor who receives payment from the debtor after the assignment has occurred will always be liable to the assignee for payment received. In this case, since Baker paid the debt owed to Sable prior to receiving notice of the assignment, he/she has extinguished all liability on the debt. However, Sable is liable to Rich for payment received. Consequently, Rich is entitled to collect $50,000 from Sable only.
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