Notification before disposition of collateral

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  • (a) “Notification date.” 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) Notification of disposition required. Except as otherwise provided in subsection (d), a secured party that disposes of collateral under § 9–610 shall send to the persons specified in subsection (c) a reasonable authenticated notification of disposition.

  • (c) Persons to be notified. To comply with subsection (b), the secured party 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, 10 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, 10 days before the notification date, held a security interest in the collateral perfected by compliance with a statute, regulation, or treaty described in § 9–311(a).

  • (d) Subsection (b) inapplicable: perishable collateral; recognized market. 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) Compliance with subsection (c)(3)(B). A secured party complies with the requirement for notification prescribed by subsection (c)(3)(B) if:

    • (1) not later than 20 days or earlier than 30 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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