California · Commercial Code

COM §1310: An obligation may be issued as subordinated to performance of another obligation of the person obligated, or a creditor may subordinate its right to performance of an obligation by agreement with eith

What this law says, in plain English

An obligation may be made subordinate to another obligation, or a creditor may agree to subordinate its right to payment through agreement.

Read the full statutory text

An obligation may be issued as subordinated to performance of another obligation of the person obligated, or a creditor may subordinate its right to performance of an obligation by agreement with either the person obligated or another creditor of the person obligated. Subordination does not create a security interest as against either the common debtor or a subordinated creditor.

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