An action by the assignee of a thing in action shall be without prejudice to any counterclaim or defense existing between the original parties; but this section shall not apply to negotiable bonds, promissory notes, or bills of exchange, transferred in good faith, and upon good consideration before due.
§ 25-303.Assignee; defenses and counterclaims available.
Article 3: Parties · Not amended since original codification · Last verified July 22, 2026
In one sentenceThis section preserves whatever defenses or counterclaims a defendant had against the original owner of a claim when the assignee of that claim sues, except for negotiable notes or bills of exchange transferred in good faith before they came due.
Full Text of § 25-303
Source
R.S.1867, Code § 31, p. 398; R.S.1913, § 7584; C.S.1922, § 8527; C.S.1929, § 20-303; R.S.1943, § 25-303.
Plain-English Summary
Section 25-303 protects defendants when a claim against them changes hands. If the assignee of a thing in action sues, the lawsuit proceeds without prejudice to any counterclaim or defense that existed between the original parties. In practical terms, the assignee steps into the assignor’s shoes and takes the claim subject to the same weaknesses it already had, whether that is a payment already made, a breach by the original claimant, or an offsetting claim the defendant could have raised against the assignor.
The section carves out one important exception. It does not apply to negotiable bonds, promissory notes, or bills of exchange that were transferred in good faith and for good consideration before they were due. Those instruments follow the more protective rule that lets a good-faith holder take free of many defenses that would otherwise be available, encouraging the free circulation of negotiable paper.
Together with Section 25-302, this section strikes a balance: an assignee can sue on an assigned claim without joining the assignor, but ordinary assignments do not improve the claim’s legal position or strip the defendant of defenses that were already good against the original owner.
Frequently Asked Questions
If my claim gets assigned to someone else, do I lose my defenses against the original creditor?
Generally no. Section 25-303 lets you raise the same counterclaims and defenses against the assignee that you had against the original party, with a narrow exception for certain negotiable instruments.
What is the exception for negotiable instruments?
The protection does not apply to negotiable bonds, promissory notes, or bills of exchange transferred in good faith and for good consideration before they were due.
Why are negotiable instruments treated differently?
The law favors the free circulation of negotiable paper, so a good-faith holder who takes it before maturity and for value generally takes it free of many defenses that would apply to an ordinary assigned claim.
Does this section apply if the assignment happened after the claim was already in default?
The section addresses which defenses survive the assignment rather than the timing of default; the key questions are whether the defense or counterclaim existed between the original parties and whether the narrow negotiable-instrument exception applies.
Can I still sue the original assignor directly instead of the assignee?
This section addresses what defenses apply when the assignee sues; whether the original assignor remains a proper party depends on the nature of the assignment and other sections in this article.
Source & verification. Section text and the amendment-history citation are
reproduced verbatim from the Nebraska Legislature, Revisor of Statutes, enacted by the
Nebraska Legislature. Last verified July 22, 2026. ·
Official source
Also known as: defenses against assignee nebraskacounterclaim against assigned claimnegotiable instrument exception nebraskaassignee takes subject to defensesholder in due course nebraska statute