Judgment For Reading Co-Operative Bank Upheld On Appeal

A jury in the Business Litigation Session of Suffolk Superior Court in Boston returned a verdict in favor of Nutter's client, Reading Co-operative Bank, and against Suffolk Constr. Co., Inc. Suffolk appealed and the SJC affirmed the verdict. A major issue before the SJC was whether Article 9 of the UCC displaced the common law on the question of the proper measure of a secured creditor's recovery under G. L. c. 106, § 9-405. The SJC held that it did and that "[w]here an account debtor receives notification of an assignment but nonetheless makes payments to the assignor, it remains obligated in full under the operative contract." And the proper measure of the assignee's recovery is the total value of all payments wrongfully misdirected.