Section 400.9-611

Title XXVI TRADE AND COMMERCE

Chapter 400

Effective - 28 Aug 2002, 2 histories   

  400.9-611.  Notification before disposition of collateral. — (a)  In this section, "notification date" means the earlier of the date on which:

  (1)  A secured party sends to the debtor and any secondary obligor an authenticated notification of disposition; or

  (2)  The debtor and any secondary obligor waive the right to notification.

  (b)  Except as otherwise provided in subsection (d), a secured party that disposes of collateral under section 400.9-610 shall send to the persons specified in subsection (c) a reasonable authenticated notification of disposition.

  (c)  To comply with subsection (b), the secured party shall send an authenticated notification of disposition to:

  (1)  The debtor;

  (2)  Any secondary obligor; and

  (3)  If the collateral is other than consumer goods:

  (A)  Any other person from which the secured party has received, before the notification date, an authenticated notification of a claim of an interest in the collateral;

  (B)  Any other secured party or lienholder that, ten days before the notification date, held a security interest in or other lien on the collateral perfected by the filing of a financing statement that:

  (i)  Identified the collateral;

  (ii)  Was indexed under the debtor's name as of that date; and

  (iii)  Was filed in the office in which to file a financing statement against the debtor covering the collateral as of that date; and

  (C)  Any other secured party that, ten days before the notification date, held a security interest in the collateral perfected by compliance with a statute, regulation, or treaty described in section 400.9-311(a).

  (d)  Subsection (b) does not apply if the collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market.

  (e)  A secured party complies with the requirement for notification prescribed by subsection (c)(3)(B) if:

  (1)  Not later than twenty days or earlier than thirty days before the notification date, the secured party requests, in a commercially reasonable manner, information concerning financing statements indexed under the debtor's name in the office indicated in subsection (c)(3)(B); and

  (2)  Before the notification date, the secured party:

  (A)  Did not receive a response to the request for information; or

  (B)  Received a response to the request for information and sent an authenticated notification of disposition to each secured party or other lienholder named in that response whose financing statement covered the collateral.

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(L. 2001 S.B. 288, A.L. 2002 S.B. 895)