38Right of recovery if principal fails to pay

38 Right of recovery if principal fails to pay (1) An assignment effected by operation of this Division is valid at law. (2) Accordingly, if the principal fails to make any payment required to be made by this Division, the claimant may sue for and recover the debt assigned to the claimant, in the claimant's own name. (3) Proceedings for recovery of the debt may be taken in any manner in which the respondent might have taken them if there had been no assignment. (4) A claimant's right of recovery under this section is subject to any defence that the principal would have had against recovery of the debt by the respondent had there been no assignment, other than a defence based on something done by the principal after the notice of claim was served by the claimant. **Example** If the principal continues to make contract payments to the respondent, rather than the claimant, after having been served with a notice of claim, the claimant is still entitled to recover the money from the principal.