When is an assignment of accounts or payment intangibles automatically perfected?

The assignment of accounts or payment intangibles is automatically perfected when it does not transfer a significant part of the outstanding accounts. This principle stems from the idea that a secured party can achieve automatic perfection in situations involving accounts or payment intangibles without needing to file a financing statement or take possession of the collateral, provided that certain conditions are met.

When an assignment is made that does not transfer a significant part of the accounts, the assignee enjoys a level of protection against other users of the collateral and third-party claims, minimizing risks associated with competing claims on the same collateral. This rule is largely beneficial in commercial transactions where large volumes of accounts or payment intangibles are common and allows for easier flow of credit and less administrative burden.

The other choices do not align with the automatic perfection rule for accounts or payment intangibles as outlined in UCC Article 9. For instance, transferring the entire account (first option) could lead to complexities in perfection depending on the nature of the assignment, while assigning in the context of a consumer (third option) introduces additional factors that may not lead to automatic perfection. The presence of a written agreement (fourth option) is beneficial for clarity and enforceability but does not, on its own, trigger automatic