Alabama § 7-9A-917 - Liability.

§ 7-9A-917. Liability.

(a) An assignor is not personally liable for an act or omission by the assignee.

(b) An assignee is not personally liable for an act or omission by the assignor.

(c) If an assignor designates a representative that may act on behalf of the assignor under Section 7-9A-908(b)(4), the representative is exculpated to the same extent as a person acting on behalf of the assignor under other law had there been no assignment, except for an act or omission resulting from the representative’s gross negligence or willful misconduct.

(d) A term of an assignment agreement relieving the assignee of liability is unenforceable to the extent the agreement relieves the assignee of liability for an act or omission committed in bad faith or with reckless indifference to the purposes of the assignment or the interests of the creditors of the assignment estate.

(e) Subject to subsection (f), an assignee is personally liable for breach of a fiduciary duty under Section 7-9A-909(a). If the assignee is liable:

(1) The assignee is personally liable to a creditor for an individualized harm to the creditor, if the harm is not shared by all creditors or a class of creditors; and

(2) The assignee is personally liable to the assignment estate for a harm shared by all creditors or a class of creditors.

(f) An assignee is not liable if, in the performance of the assignee’s duties and exercise of the assignee’s powers, the assignee relies in good faith on:

(1) A record of the assignor;

(2) Information, an opinion, a report, or a statement presented to the assignee by the assignor’s officer or employee, a committee of the assignor’s board of directors, an independent director or manager of the assignor, or another representative of the assignor; or

(3) Information, an opinion, a report, or a statement presented to the assignee by another person that has been selected with reasonable care by or on behalf of the assignee as to a matter the assignee reasonably believes is within the other person’s professional or expert competence.