25-303. Assignee; defenses and counterclaims available.

An action by the assignee of a thing in action shall be without prejudice to any counterclaim or defense existing between the original parties; but this section shall not apply to negotiable bonds, promissory notes, or bills of exchange, transferred in good faith, and upon good consideration before due.

Source

Annotations

1. General

2. Promissory notes

3. Miscellaneous

1. General

The assignee of a chose in action acquires no greater rights than those of the assignor, and takes it subject to all the defenses existent at the time. Midwest Renewable Energy v. American Engr. Testing, 296 Neb. 73, 894 N.W.2d 221 (2017).

The fundamental test to be applied in ascertaining whether the plaintiff is the real party in interest is whether or not the prosecution of the action will save the defendant from further harassment or vexation at the hands of other claimants to the same demand. Archer v. Musick, 147 Neb. 1018, 25 N.W.2d 908 (1947).

Defenses arising against the assignor, after notice of the assignment, cannot be set off against the claim of the assignee. Cronkleton v. Hastings Theatre and Realty Corp., 134 Neb. 168, 278 N.W. 144 (1938).

2. Promissory notes

Where promissory note was purchased after maturity, it was subject to any set-off or other defense against prior holder. Wilbur v. Jeep, 37 Neb. 604, 56 N.W. 198 (1893).

An endorsement of a promissory note not for value, but for the purpose of collection, does not cut off defenses of maker defendant. Roberts v. Snow, 27 Neb. 425, 43 N.W. 241 (1889).

A promissory note assigned by a separate writing rather than by endorsement is not transferred within the meaning of this section and the maker's defense of usury is available against the assignee. Doll v. Hollenbeck, 19 Neb. 639, 28 N.W. 286 (1886).

The purchaser of a note after maturity takes it subject to any set-off good between the original parties. Davis v. Neligh, 7 Neb. 78 (1878).

3. Miscellaneous

Purchaser of village warrants takes same subject to any equities existing against holder. Union Nat. Bank of Fremont v. Village of Beemer, 123 Neb. 778, 244 N.W. 303 (1932).

Account cannot be assigned free from right of set-off. Olsen v. Marquis, 88 Neb. 610, 130 N.W. 267 (1911).

Future earnings or profits under an existing contract are assignable. First Nat. Bank of Madison v. School Dist. No. 1, 77 Neb. 570, 110 N.W. 349 (1906).

In action on certificate of deposit transferred after due, maker may set off any cross-demand against original payee which existed at time of transfer. First Nat. Bank of Rapid City v. Security Nat. Bank of Sioux City, 34 Neb. 71, 51 N.W. 305 (1892).