Idaho State Statutes - Idaho Attorney Directory

RESTRICTIONS ON ASSIGNMENT OF PROMISSORY NOTES, HEALTH CARE
INSURANCE RECEIVABLES, AND CERTAIN GENERAL INTANGIBLES INEFFECTIVE. (a) Except
as otherwise provided in subsection (b) of this section, a term in a
promissory note or in an agreement between an account debtor and a debtor
which relates to a health care insurance receivable or a general intangible,
including a contract, permit, license, or franchise, and which term prohibits,
restricts, or requires the consent of the person obligated on the promissory
note or the account debtor to, the assignment or transfer of, or creation,
attachment, or perfection of a security interest in, the promissory note,
health care insurance receivable, or general intangible, is ineffective to the
extent that the term:
(1) Would impair the creation, attachment or perfection of a security
interest; or
(2) Provides that the assignment or transfer or the creation, attachment,
or perfection of the security interest may give rise to a default, breach,
right of recoupment, claim, defense, termination, right of termination, or
remedy under the promissory note, health care insurance receivable, or
general intangible.
(b) Subsection (a) of this section applies to a security interest in a
payment intangible or promissory note only if the security interest arises out
of a sale of the payment intangible or promissory note.
(c) A rule of law, statute, rule or regulation that prohibits, restricts,
or requires the consent of a government, governmental body or official, person
obligated on a promissory note, or account debtor to the assignment or
transfer of, or creation of a security interest in, a promissory note, health
care insurance receivable, or general intangible, including a contract,
permit, license, or franchise between an account debtor and a debtor, is
ineffective to the extent that the rule of law, statute or regulation:
(1) Would impair the creation, attachment or perfection of a security
interest; or
(2) Provides that the assignment or transfer or the creation, attachment,
or perfection of the security interest may give rise to a default, breach,
right of recoupment, claim, defense, termination, right of termination, or
remedy under the promissory note, health care insurance receivable, or
general intangible.
(d) To the extent that a term in a promissory note or in an agreement
between an account debtor and a debtor which relates to a health care
insurance receivable or general intangible or a rule of law, statute or
regulation described in subsection (c) of this section would be effective
under law other than this chapter but is ineffective under subsection (a) or
(c) of this section, the creation, attachment, or perfection of a security
interest in the promissory note, health care insurance receivable, or general
intangible:
(1) Is not enforceable against the person obligated on the promissory
note or the account debtor;
(2) Does not impose a duty or obligation on the person obligated on the
promissory note or the account debtor;
(3) Does not require the person obligated on the promissory note or the
account debtor to recognize the security interest, pay or render
performance to the secured party, or accept payment or performance from
the secured party;
(4) Does not entitle the secured party to use or assign the debtor's
rights under the promissory note, health care insurance receivable, or
general intangible, including any related information or materials
furnished to the debtor in the transaction giving rise to the promissory
note, health care insurance receivable, or general intangible;
(5) Does not entitle the secured party to use, assign, possess, or have
access to any trade secrets or confidential information of the person
obligated on the promissory note or the account debtor; and
(6) Does not entitle the secured party to enforce the security interest
in the promissory note, health care insurance receivable, or general
intangible.

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