Part Ⅱ Obligations
Chapter II Particular Kinds Of Obligations
Section 20 - Security Payable By An Assigned Person
A security payable by an assigned person is an instrument whereby a person directs another person to deliver to a third party money or valuable securities or other fungible things.
Under the preceding paragraph, the person who directs is called the assignor; the person who is directed is called the assignee; and the person to whom presentation is made is called the payee.
When the assignee has notified the payee that he accepts to perform the order of payment, he is bound to perform it in accordance with the tenor of the order.
In the case specified in the preceding paragraph, the assignee may only take such defenses as arises from the tenor of the order or from his legal relationship with the payee as valid defenses against the payee.
If a security payable by an assigned person is made by the assignor for the performance of a debt due to the payee, the debt is extinguished when prestation is made by the assignee.
In the case specified in the preceding paragraph, the creditor who has accepted an order of payment shall not claim payment of the original debt from the assignor, except he has been unable to procure prestation of the order by the assignee within the time specified in the securities, or, if no time is specified, within a reasonable time.
A creditor who is not willing to accept a security payable by an assigned person from his debtor shall notify the latter of his refusal without delay.
Even though the assignee is indebted to the assignor, he is not bound to accept the assignment of payment or to perform it. If he performs it, he is released from his debt to the assignor to the amount of his performance.
If the assignee refuses acceptance or performance of the security payable by an assigned person, the payee shall notify the assignor of the refusal without delay.
An assignor may revoke his security payable by an assigned person so long as the assignee has not notified the payee of his acceptance or performance of the order. Such revocation shall be made by an expression of intent to the assignee.
The order is deemed to be revoked, if the assignor declares bankrupt before the acceptance or performance of the order by the assignee.
The payee may transfer the security payable by an assigned person to a third party, except the assignor has inserted in the securities itself that transfer is forbidden.
The transfer specified in the preceding paragraph shall be made by endorsement.
If the assignee accepts the assignment in favor of the transferee, he shall not take whatever resulting from his legal relationship with the payee as valid defenses against the transferee.
The claim of the payee or the transferee against the assignee who has accepted the security payable by an assigned person is extinguished by prescription, if not exercised within three years from date of acceptance.
In case securities has been lost, stolen or destroyed, the court may, on the application of the bearer, declare the order invalid by means of proceedings by public summons.