§ 25-9-611. Notification before disposition of collateral.

473 words·~2 min read·/nc/chapter-25/25-9-611

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(a)Notification Date. - In this section, notification date means the date of the earlier of the following:

(1)A secured party sends to the debtor and any secondary obligor a signed notification of disposition.

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

(b)Notification of Disposition Required. - Except as otherwise provided in subsection

(d)of this section, a secured party that disposes of collateral under G.S. 25-9-610 shall send to the persons specified in subsection

(c)of this section a reasonable signed notification of disposition.

(c)Persons to be Notified. - To comply with subsection

(b)of this section, the secured party shall send a signed notification of disposition to all of the following:

(1)The debtor.

(2)Any secondary obligor.

(3)If the collateral is other than consumer goods, all of the following:

a. Any other person from which the secured party has received, before the notification date, a signed 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 meets all of the following requirements:

1. Identified the collateral.

2. Was indexed under the debtor's name as of that date.

3. Was filed in the office in which to file a financing statement against the debtor covering the collateral as of that date.

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 G.S. 25-9-311(a).

(d)Subsection

(b)Inapplicable to Perishable Collateral or Recognized Market. - Subsection

(b)of this section 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 Sub-Subdivision (c)(3)b. - A secured party complies with the requirement for notification prescribed by sub-subdivision (c)(3)b. of this section if both of the following apply:

(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 sub-subdivision (c)(3)b. of this section.

(2)Before the notification date, either of the following applied:

a. The secured party did not receive a response to the request for information.

b. The secured party received a response to the request for information and sent a signed notification of disposition to each secured party or other lienholder named in that response whose financing statement covered the collateral. (1965, c. 700, s. 1; 1975, c. 862, s. 7; 2000-169, s. 1; 2025-25, s. 98.)