41-09-123. (9-628) Nonliability and limitation on liability of secured party - Liability of
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secondary obligor.
1. Subject to subsection 5, 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 chapter; and
b. The secured party's failure to comply with this chapter does not affect the liability
of the person for a deficiency.
2. Subject to subsection 5, 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:
(1)That the person is a debtor or obligor;
(2)The identity of the person; and
(3)How to communicate with the person; or
b. To a secured party or lienholder that has filed a financing statement against a
person, unless the secured party knows:
(1)That the person is a debtor; and
(2)The identity of the person.
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
b. An obligor's representation concerning the purpose for which a secured obligation
was incurred. 4. A secured party is not liable under subdivision b of subsection 3 of section 41-09-120
more than once with respect to any one secured obligation. 5. 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
b. The secured party knows that the information in subdivision a of subsection 2
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.
41-09-124. (9-702) Savings clause. 1. Except as otherwise provided in this part, this chapter applies to a transaction or lien
within its scope, even if the transaction or lien was entered into or created before
July 1, 2001. 2. Except as otherwise provided in subsection 3 and sections 41-09-125 through
41-09-131:
a. Transactions and liens that were not governed by the former chapter 41-09 were
validly entered into or created before July 1, 2001, and would be subject to this
chapter if they had been entered into or created on or after July 1, 2001, and the
rights, duties, and interests flowing from those transactions and liens remain valid
after July 1, 2001; and
b. The transactions and liens may be terminated, completed, consummated, and
enforced as required or permitted by this chapter or by the law that otherwise
would apply if this chapter had not taken effect. 3. This chapter does not affect an action, case, or proceeding commenced before July 1,
2001.
41-09-125. (9-703) Security interest perfected before effective date. 1. A security interest that is enforceable immediately before July 1, 2001, and would have
priority over the rights of a person that becomes a lien creditor at that time is a
perfected security interest under this chapter if, on July 1, 2001, the applicable
requirements for enforceability and perfection under this chapter are satisfied without
further action. 2. Except as otherwise provided in section 41-09-127, if, immediately before July 1,
2001, a security interest is enforceable and would have priority over the rights of a
person that becomes a lien creditor at that time, but the applicable requirements for
enforceability or perfection under this chapter are not satisfied on July 1, 2001, the
security interest:
a. Is a perfected security interest for one year after this chapter takes effect;
b. Remains enforceable thereafter only if the security interest becomes enforceable
under section 41-09-13 before the year expires; and
c. Remains perfected thereafter only if the applicable requirements for perfection
under this chapter are satisfied before the year expires.