Barbara owes Arthur $2,000. On July 1, Arthur assigns the debt to Caleb. Thereafter on July 15, Arthur assigns the same right to David, who in good faith gives value for it and knows nothing about the first assignee. David immediately notifies Barbara of the assignment. In this case:
A) under the majority rule, David has priority.
B) under the English Rule, a second assignment of the same claim can never be effective.
C) under the English Rule, David has priority.
D) under all of the rules, Caleb has priority since he was the first assignee in time.

Question

Quizplus · Accepted Answer

DUnder the English Rule, the priority is given to the first assignee to notify the debtor, which in this case would be David, as he immediately notifies Barbara of the assignment. However, under general principles and in many jurisdictions, the first assignee in time (Caleb) has priority over subsequent assignees, regardless of notification, hence why Caleb would have priority under a broad application of rules.

Barbara Owes Arthur $2,000