Nashua Manufacturing Company v. Hooper Trailer Sales, Inc., Bankrupts

This case presents a single question: whether the failure of an assignee of accounts receivable to use the filing provisions of the Idaho Assignment of Accounts Receivable Act, Idaho Code Title 64, ch. 9, particularly the annual refiling provision of § 64-903(2), renders the assignment void as against creditors, including the trustee in bankruptcy of the assignor, even though the assignee had given notice of the assignment to the account debtor. The trial court held for the creditor and the trustee, and against the assignee. We affirm.

On appeal, the assignee argues that the Act merely establishes an alternative method of perfecting such an assignment. It points out that before the adoption of the Act, notification by the assignee to the account debtor sufficiently perfected the assignment to protect the assignee against subsequent assignees of the same account, and that even such notice was not necessary for protection against subsequent creditors, as distinguished from assignees. See Porter v. Title Guaranty and Surety Co., 1912, 21 Idaho 312 , 121 P. 548 ; Gem State Lumber Co. v. Galion Irrigated Land Co., 1935, 55 Idaho 314 , 41 P.2d 620 . Next, it points to the fact that the…