(A) A modification of or substitution for an assigned contract is effective against an assignee if made in good faith. The assignee acquires corresponding rights under the modified or substituted contract. The assignment may provide that the modification or substitution is a breach of contract by the assignor. This division is subject to divisions (B) to (D) of this section.

Terms Used In Ohio Code 1309.405

  • Account: includes health-care insurance receivables. See Ohio Code 1309.102
  • Account debtor: means a person who is obligated on an account, chattel paper, or general intangible. See Ohio Code 1309.102
  • Contract: A legal written agreement that becomes binding when signed.
  • Debtor: means :

    (a) A person having an interest, other than a security interest or other lien, in the collateral, whether or not the person is an obligor;

    (b) A seller of accounts, chattel paper, payment intangibles, or promissory notes; or

    (c) A consignee. See Ohio Code 1309.102

  • Health-care-insurance receivable: means an interest in or claim under a policy of insurance that is a right to payment of a monetary obligation for health-care goods or services provided. See Ohio Code 1309.102
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Rule: includes regulation. See Ohio Code 1.59

(B) Division (A) of this section applies to the extent that:

(1) The right to payment or a part thereof under an assigned contract has not been fully earned by performance; or

(2) The right to payment or a part thereof has been fully earned by performance, and the account debtor has not received notification of the assignment under division (A) of section 1309.406 of the Revised Code.

(C) This section is subject to law other than this chapter that establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

(D) This section does not apply to an assignment of a health-care-insurance receivable.

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