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Paula, an accountant, lent money to a company that was already indebted to her for services rendered. As security for the loan and to secure
Paula, an accountant, lent money to a company that was already indebted to her for services rendered. As security for the loan and to secure payment for the services, the company assigned to Paula a portion of its expected recovery of a pending lawsuit. Paula did not file a financing statement with regard to the assign- ment. Subsequently, Debra was awarded a judgment against the company in another lawsuit. Debra, without knowledge of the assignment to Paula, had the sheriff levy against the company's property. At the sheriff's execution sale, all of the company's rights in the pend- lawsuit were sold to Debra. When the lawsuit was ettled, Paula claimed rights to the proceeds. Is Paula entitled to the proceeds of the lawsuit pursuant to her ecuritv interest? Explain. ing
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