§ 6A-9-628 - Nonliability and limitation on liability of secured party; liability of secondary obligor.
SECTION 6A-9-628
§ 6A-9-628 Nonliability and limitation onliability of secured party; liability of secondary obligor. – (a) Limitation of liability of secured party for noncompliance withchapter. 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:
(1) The secured party is not liable to the person, or to asecured party or lienholder that has filed a financing statement against theperson, for failure to comply with this chapter; and
(2) The secured party's failure to comply with this chapterdoes not affect the liability of the person for a deficiency.
(b) Limitation of liability based on status as securedparty. A secured party is not liable because of its status as secured party:
(1) To a person that is a debtor or obligor, unless thesecured 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
(2) To a secured party or lienholder that has filed afinancing statement against a person, unless the secured party knows:
(i) That the person is a debtor; and
(ii) The identity of the person.
(c) Limitation of liability if reasonable belief thattransaction not a consumer-goods transaction or consumer transaction. Asecured party is not liable to any person, and a person's liability for adeficiency is not affected, because of any act or omission arising out of thesecured party's reasonable belief that a transaction is not a consumer-goodstransaction or a consumer transaction or that goods are not consumer goods, ifthe secured party's belief is based on its reasonable reliance on:
(1) A debtor's representation concerning the purpose forwhich collateral was to be used, acquired, or held; or
(2) An obligor's representation concerning the purpose forwhich a secured obligation was incurred.
(d) Limitation of liability for statutory damages. Asecured party is not liable to any person under § 6A-9-625(c)(2) for itsfailure to comply with § 6A-9-616.
(e) Limitation of multiple liability for statutorydamages. A secured party is not liable under § 6A-9-625(c)(2) morethan once with respect to any one secured obligation.