Vermont § 406 - § 9—406.

§ 406. § 9—406.

• Discharge of account debtor; notification of assignment; identification and proof
  of assignment; restrictions on assignment of accounts, chattel paper, payment intangibles,
  and promissory notes ineffective (a) Subject to subsections (b) through (i) and (l) of this section, an account debtor on an account, chattel paper, or a payment intangible
  may discharge its obligation by paying the assignor until, but not after, the account
  debtor receives a notification, signed by the assignor or the assignee, that the amount
  due or to become due has been assigned and that payment is to be made to the assignee.
  After receipt of the notification, the account debtor may discharge its obligation
  by paying the assignee and may not discharge the obligation by paying the assignor. (b) Subject to subsections (h) and (l) of this section, notification is ineffective under subsection (a) of this section: (1) if it does not reasonably identify the rights assigned; (2) to the extent that an agreement between an account debtor and a seller of a payment
  intangible limits the account debtor’s duty to pay a person other than the seller
  and the limitation is effective under law other than this article; or (3) at the option of an account debtor, if the notification notifies the account debtor
  to make less than the full amount of any installment or other periodic payment to
  the assignee, even if: (A) only a portion of the account, chattel paper, or payment intangible has been assigned
  to that assignee; (B) a portion has been assigned to another assignee; or (C) the account debtor knows that the assignment to that assignee is limited. (c) Subject to subsections (h) and (l) of this section, if requested by the account debtor, an assignee shall seasonably
  furnish reasonable proof that the assignment has been made. Unless the assignee complies,
  the account debtor may discharge its obligation by paying the assignor, even if the
  account debtor has received a notification under subsection (a) of this section. (d) In this subsection, “promissory note” includes a negotiable instrument that evidences
  chattel paper. Except as otherwise provided in subsections (e) and (k) of this section
  and sections 2A—303 and 9—407 of this title, and subject to subsection (h) of this section, a term in an agreement between an
  account debtor and an assignor or in a promissory note is ineffective to the extent
  that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated
  on the promissory note to the assignment or transfer of, or the creation, attachment,
  perfection, or enforcement of a security interest in, the account, chattel paper,
  payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection,
  or enforcement of the security interest may give rise to a default, breach, right
  of recoupment, claim, defense, termination, right of termination, or remedy under
  the account, chattel paper, payment intangible, or promissory note. (e) Subsection (d) of this section does not apply to the sale of a payment intangible
  or promissory note, other than a sale pursuant to a disposition under section 9—610 of this title or an acceptance of collateral under section 9—620 of this title. (f) Except as otherwise provided in subsection (k) of this section and sections 2A—303 and 9—407 of this title and subject to subsections (h) and (i) of this section, a rule of law, statute, or
  regulation that prohibits, restricts, or requires the consent of a government, governmental
  body or official, or account debtor to the assignment or transfer of, or creation
  of a security interest in, an account or chattel paper is ineffective to the extent
  that the rule of law, statute, or regulation: (1) prohibits, restricts, or requires the consent of the government, governmental body
  or official, or account debtor to the assignment or transfer of, or the creation,
  attachment, perfection, or enforcement of, a security interest in the account or chattel
  paper; or (2) provides that the assignment or transfer or the creation, attachment, perfection,
  or enforcement of the security interest may give rise to a default, breach, right
  of recoupment, claim, defense, termination, right of termination, or remedy under
  the account or chattel paper. (g) Subject to subsections (h) and (l) of this section, an account debtor may not waive or vary its option under subdivision
  (b)(3) of this section. (h) This section is subject to law other than this article which establishes a different
  rule for an account debtor who is an individual and who incurred the obligation primarily
  for personal, family, or household purposes. (i) This section does not apply to an assignment of a health care insurance receivable. (j) This section prevails over any inconsistent provisions of this title. (k) Subsections (d), (f), and (j) of this section do not apply to a security interest
  in an ownership interest in a general partnership, limited partnership, or limited
  liability company. (l) Subsections (a), (b), (c), and (g) of this section do not apply to a controllable
  account or controllable payment intangible. (Added 1999, No. 106 (Adj. Sess.), § 2, eff. July 1, 2001; amended 2001, No. 46, § 4; 2013, No. 157 (Adj. Sess.), § 1; 2025, No. 17, § 9, eff. July 1, 2025.)