§9-1628. Nonliability and limitation on liability of secured party; liability of secondary obligor
(CONTAINS TEXT WITH VARYING EFFECTIVE DATES)
(1).
(TEXT EFFECTIVE UNTIL 7/01/25) Unless a secured party knows that a person is a debtor or obligor, knows the identity of the person and knows how to communicate with the person:
(a).
The secured party is not liable to the person or to a secured party or lienholder that has filed a financing statement against the person for failure to comply with this Article; and
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b).
The secured party's failure to comply with this Article does not affect the liability of the person for a deficiency.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(1).
(TEXT EFFECTIVE 7/01/25) Subject to subsection (6), unless a secured party knows that a person is a debtor or obligor, knows the identity of the person and knows how to communicate with the person:
(a).
The secured party is not liable to the person or to a secured party or lienholder that has filed a financing statement against the person for failure to comply with this Article; and
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b).
The secured party's failure to comply with this Article does not affect the liability of the person for a deficiency.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 2023, c. 669, Pt. A, §166 (AMD); PL 2023, c. 669, Pt. E, §1 (AFF).]
(2).
(TEXT EFFECTIVE UNTIL 7/01/25) A secured party is not liable because of its status as secured party:
(a).
To a person that is a debtor or obligor, unless the secured party knows:
(i)
That the person is a debtor or obligor;
(ii)
The identity of the person; and
(iii)
How to communicate with the person; or
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b).
To a secured party or lienholder that has filed a financing statement against a person, unless the secured party knows:
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(i)
That the person is a debtor; and
(ii)
The identity of the person.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(2).
(TEXT EFFECTIVE 7/01/25) Subject to subsection (6), a secured party is not liable because of its status as secured party:
(a).
To a person that is a debtor or obligor, unless the secured party knows:
(i)
That the person is a debtor or obligor;
(ii)
The identity of the person; and
(iii)
How to communicate with the person; or
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b).
To a secured party or lienholder that has filed a financing statement against a person, unless the secured party knows:
[PL 2023, c. 669, Pt. A, §167 (AMD); PL 2023, c. 669, Pt. E, §1 (AFF).]
(i)
That the person is a debtor; and
(ii)
The identity of the person.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(3).
A secured party is not liable to any person, and a person's liability for a deficiency is not affected because of any act or omission arising out of the secured party's reasonable belief that a transaction is not a consumer-goods transaction or a consumer transaction or that goods are not consumer goods, if the secured party's belief is based on its reasonable reliance on:
(a).
A debtor's representation concerning the purpose for which collateral was to be used, acquired or held; or
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b).
An obligor's representation concerning the purpose for which a secured obligation was incurred.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(4).
A secured party is not liable to any person under section 9‑1625, subsection (3), paragraph (b) for its failure to comply with section 9‑1616.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(5).
A secured party is not liable under section 9‑1625, subsection (3), paragraph (b) more than once with respect to any one secured obligation.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(6).
(TEXT EFFECTIVE 7/01/25)
Subsections (1) and (2) do not apply to limit the liability of a secured party to a person if, at the time the secured party obtains control of collateral that is a controllable account, controllable electronic record or controllable payment intangible or at the time the security interest attaches to the collateral, whichever is later:
(a).
The person is a debtor or obligor; and
[PL 2023, c. 669, Pt. A, §168 (NEW); PL 2023, c. 669, Pt. E, §1 (AFF).]
(b).
The secured party knows that the information in subsection (2), paragraph (a), subparagraph (i), (ii) or (iii) relating to the person is not provided by the collateral, a record attached to or logically associated with the collateral or the system in which the collateral is recorded.
[PL 2023, c. 669, Pt. A, §168 (NEW); PL 2023, c. 669, Pt. E, §1 (AFF).]
[PL 2023, c. 669, Pt. A, §168 (NEW); PL 2023, c. 669, Pt. E, §1 (AFF).]
SECTION HISTORY
PL 1999, c. 699, §A2 (NEW). PL 1999, c. 699, §A4 (AFF). PL 2023, c. 669, Pt. A, §§166-168 (AMD). PL 2023, c. 669, Pt. E, §1 (AFF).