New Jersey Revised Statutes § 12a:9-340 - Effectiveness Of Right Of Recoupment Or Set-off Against Deposit Account.

12A:9-340 Effectiveness of right of recoupment or set-off against deposit account.

12A:9-340. Effectiveness of Right of Recoupment or Set-off Against Deposit Account.

(a)Exercise of recoupment or set-off. Except as otherwise provided in subsection (c), a bank with which a deposit account is maintained may exercise any right of recoupment or set-off against a secured party that holds a security interest in the deposit account.

(b)Recoupment or set-off not affected by security interest. Except as otherwise provided in subsection (c), the application of this chapter to a security interest in a deposit account does not affect a right of recoupment or set-off of the secured party as to a deposit account maintained with the secured party.

(c)When set-off ineffective. The exercise by a bank of a set-off 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 12A:9-104 (a) (3), if the set-off is based on a claim against the debtor.

L.2001, c.117, s.1; amended 2001, c.386, s.55.


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Last modified: October 11, 2016