§ 9340. Effectiveness of right of recoupment or set-off against deposit account.

178 words·~1 min read·/pa/title-13/chapter-93/9340

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(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 division 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 section 9104(a)(3) (relating to requirements for control) if the set-off is based on a claim against the debtor.

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Cross References. Section 9340 is referred to in sections 9109, 9341 of this title.

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