A later assignee for consideration may prevail if what condition exists?

A later assignee for consideration may prevail if what condition exists?

• A. The earlier assignee prevails
• B. The assignee who files last prevails
• C. The later assignee prevails if he did not know of earlier assignments and is the first to obtain payment or a judgment against the obligor
• D. The first assignee for consideration prevails

Answer: (C)

When multiple people hold an assignment of the same claim, priority isn’t simply about who acted first. A later assignee for value can prevail only if he took without knowledge of any earlier assignment and he is the first to obtain payment or a judgment against the obligor. This protects good-faith transfers and rewards prompt collection, preventing a debtor from using prior transfers to dodge payment to later holders. If the later assignee knew about the earlier assignment, or if someone else is the first to collect, the later’s advantage is lost and the earlier rights control.

When multiple people hold an assignment of the same claim, priority isn’t simply about who acted first. A later assignee for value can prevail only if he took without knowledge of any earlier assignment and he is the first to obtain payment or a judgment against the obligor. This protects good-faith transfers and rewards prompt collection, preventing a debtor from using prior transfers to dodge payment to later holders. If the later assignee knew about the earlier assignment, or if someone else is the first to collect, the later’s advantage is lost and the earlier rights control.