12A:9-622 Effect of acceptance of collateral.
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/nj/title-12a/chapter-9/12a-9-622A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Effect of Acceptance of Collateral.
(a)Effect of acceptance. A secured party's acceptance of collateral in full or partial satisfaction of the obligation it secures:
(1)discharges the obligation to the extent consented to by the debtor;
(2)transfers to the secured party all of a debtor's rights in the collateral;
(3)discharges the security interest or agricultural lien that is the subject of the debtor's consent and any subordinate security interest or other subordinate lien; and
(4)terminates any other subordinate interest.
(b)Discharge of subordinate interest notwithstanding noncompliance. A subordinate interest is discharged or terminated under subsection (a), even if the secured party fails to comply with this chapter.
L.2001, c.117, s.1; amended 2001, c.386, s.111.