---
title: O.C.G.A. § 11-9-403. Agreement not to assert defenses against assignee.
collection: code
id: 11-9-403
cite_as: O.C.G.A. § 11-9-403 (2025)
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date: 2025
status: active
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heading_path: COMMERCIAL CODE / SECURED TRANSACTIONS / RIGHTS OF THIRD PARTIES
---

# O.C.G.A. § 11-9-403. Agreement not to assert defenses against assignee.

(a) “Value.” As used in this Code section, the term “value” has the meaning provided in subsection (a) of Code Section 11-3-303.

(b) Agreement not to assert claim or defense. Except as otherwise provided in this Code section, an agreement between an account debtor and an assignor not to assert against an assignee any claim or defense that the account debtor may have against the assignor is enforceable by an assignee that takes an assignment:

(1) For value;

(2) In good faith;

(3) Without notice of a claim of a property or possessory right to the property assigned; and

(4) Without notice of a defense or claim in recoupment of the type that may be asserted against a person entitled to enforce a negotiable instrument under subsection (a) of Code Section 11-3-305.

(c) When subsection (b) of this Code section not applicable. Subsection (b) of this Code section does not apply to defenses of a type that may be asserted against a holder in due course of a negotiable instrument under subsection (b) of Code Section 11-3-305.

(d) Omission of required statement in consumer transaction. In a consumer transaction, if a record evidences the account debtor’s obligation, law other than this article requires that the record include a statement to the effect that the rights of an assignee are subject to claims or defenses that the account debtor could assert against the original obligee, and the record does not include such a statement:

(1) The record has the same effect as if the record included such a statement; and

(2) The account debtor may assert against an assignee those claims and defenses that would have been available if the record included such a statement.

(e) Rule for individual under other law. This Code 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.

(f) Other law not displaced. Except as otherwise provided in subsection (d) of this Code section, this Code section does not displace law other than this article which gives effect to an agreement by an account debtor not to assert a claim or defense against an assignee.

## History

Code 1981, § 11-9-403, enacted by Ga. L. 2001, p. 362, § 1.

## Law Reviews

For comment on Geiger Fin. Co. v. Graham, 123 Ga. App. 771, 182 S.E.2d 521 (1971), see 8 Ga. St. B.J. 400 (1972).

For note analyzing consumer protection in retail installment contracts with reference to waiver of defenses by purchaser and the denial of holder in due course status to assignee of contract, in light of Geiger Fin. Co. v. Graham, 123 Ga. App. 771, 182 S.E.2d 521 (1971), see 23 Mercer L. Rev. 673 (1972).

For article supporting the retention of waiver of defense clauses in credit card agreements, see 10 Ga. St. B.J. 17 (1973).

For article discussing the implied warranty of fitness for a particular purpose, see 9 Ga. L. Rev. 149 (1974).

For article, “The Good Faith Purchase Idea and the Uniform Commercial Code,” see 15 Ga. L. Rev. 605 (1981).