California Commercial Code Section 9340
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California Laws > Commercial Code > California Commercial Code Section 9340
9340. (a) Except as otherwise provided in subdivision (c), a bank
with which a deposit account is maintained may exercise any right of
recoupment or setoff against a secured party that holds a security
interest in the deposit account.
(b) Except as otherwise provided in subdivision (c), the
application of this division to a security interest in a deposit
account does not affect a right of recoupment or setoff of the
secured party as to a deposit account maintained with the secured
party.
(c) The exercise by a bank of a setoff against a deposit account
is ineffective against a secured party that holds a security interest
in the deposit account which is perfected by control under paragraph
(3) of subdivision (a) of Section 9104, if the setoff is based on a
claim against the debtor.
Section: 9340
Last modified: February 22, 2013
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