Fix-It Auto Company contracts to sell a car to Garth for $3,500. Garth gives Fix-It a worthless check for the price. Garth assigns his right to the car to Herb. If Fix-It refuses to deliver the car to Herb and Herb sues, can Fix-It raise Garth's fraud as a defense against delivery of the car to Herb? Explain.
What will be an ideal response?
Yes. An assignee takes only those rights that the assignor originally had, and those rights are subject to any defenses that the obligor has against the assignor. In this problem, Fix-It is the obligor, Garth is the assignor, and Herb is the assignee. Garth's delivery of a worthless check to Fix-It means that Fix-It has a right to refuse to deliver the car to Garth. Fix-It can also refuse to deliver the car to Herb, for the same reason.
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