Maine Revised Statutes Title 11 Sec. 9-1615 – Application of proceeds of disposition; liability for deficiency and right to surplus
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(1). A secured party shall apply or pay over for application the cash proceeds of disposition under section 9-1610 in the following order to:
(a). The reasonable expenses of retaking, holding, preparing for disposition, processing and disposing and, to the extent provided for by agreement and not prohibited by law, reasonable attorney’s fees and legal expenses incurred by the secured party; [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b). The satisfaction of obligations secured by the security interest or agricultural lien under which the disposition is made; [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(c). The satisfaction of obligations secured by any subordinate security interest in or other subordinate lien on the collateral if:
(i) The secured party receives from the holder of the subordinate security interest or other lien an authenticated demand for proceeds before distribution of the proceeds is completed; and
(ii) In a case in which a consignor has an interest in the collateral, the subordinate security interest or other lien is senior to the interest of the consignor; and [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(d). A secured party that is a consignor of the collateral if the secured party receives from the consignor an authenticated demand for proceeds before distribution of the proceeds is completed. [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
Terms Used In Maine Revised Statutes Title 11 Sec. 9-1615
- Account: includes health-care-insurance receivables. See Maine Revised Statutes Title 11 Sec. 9-1102
- Agricultural lien: means an interest, other than a security interest, in farm products:
(a). See Maine Revised Statutes Title 11 Sec. 9-1102Cash proceeds: means proceeds that are money, checks, deposit accounts or the like. See Maine Revised Statutes Title 11 Sec. 9-1102 Chattel paper: means a record or records that evidence both a monetary obligation and a security interest in specific goods, a security interest in specific goods and license of software used in the goods, a lease of specific goods or a lease of specific goods and license of software used in the goods. See Maine Revised Statutes Title 11 Sec. 9-1102 Collateral: includes :
(a). See Maine Revised Statutes Title 11 Sec. 9-1102Consignor: means a person that delivers goods to a consignee in a consignment. See Maine Revised Statutes Title 11 Sec. 9-1102 Debtor: means :
(a). See Maine Revised Statutes Title 11 Sec. 9-1102Lien: A claim against real or personal property in satisfaction of a debt. Noncash proceeds: means proceeds other than cash proceeds. See Maine Revised Statutes Title 11 Sec. 9-1102 Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period. Obligor: means a person that, with respect to an obligation secured by a security interest in or an agricultural lien on the collateral:
(a). See Maine Revised Statutes Title 11 Sec. 9-1102Proceeds: means the following property:
(a). See Maine Revised Statutes Title 11 Sec. 9-1102Secondary obligor: means an obligor to the extent that:
(a). See Maine Revised Statutes Title 11 Sec. 9-1102Secured party: means :
(2). If requested by a secured party, a holder of a subordinate security interest or other lien shall furnish reasonable proof of the interest or lien within a reasonable time. Unless the holder does so, the secured party need not comply with the holder’s demand under subsection (1), paragraph (c).
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(3). A secured party need not apply or pay over for application noncash proceeds of disposition under section 9-1610 unless the failure to do so would be commercially unreasonable. A secured party that applies or pays over for application noncash proceeds shall do so in a commercially reasonable manner.
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(4). If the security interest under which a disposition is made secures payment or performance of an obligation, after making the payments and applications required by subsection (1) and permitted by subsection (3):
(a). Unless subsection (1), paragraph (d) requires the secured party to apply or pay over cash proceeds to a consignor, the secured party shall account to and pay a debtor for any surplus; and [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b). The obligor is liable for any deficiency. [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(5). If the underlying transaction is a sale of accounts, chattel paper, payment intangibles or promissory notes:
(a). The debtor is not entitled to any surplus; and [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b). The obligor is not liable for any deficiency. [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(6). The surplus or deficiency following a disposition is calculated based on the amount of proceeds that would have been realized in a disposition complying with this part to a transferee other than the secured party, a person related to the secured party or a secondary obligor if:
(a). The transferee in the disposition is the secured party, a person related to the secured party or a secondary obligor; and [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b). The amount of proceeds of the disposition is significantly below the range of proceeds that a complying disposition to a person other than the secured party, a person related to the secured party or a secondary obligor would have brought. [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(7). A secured party that receives cash proceeds of a disposition in good faith and without knowledge that the receipt violates the rights of the holder of a security interest or other lien that is not subordinate to the security interest or agricultural lien under which the disposition is made:
(a). Takes the cash proceeds free of the security interest or other lien; [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(b). Is not obligated to apply the proceeds of the disposition to the satisfaction of obligations secured by the security interest or other lien; and [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
(c). Is not obligated to account to or pay the holder of the security interest or other lien for any surplus. [PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
[PL 1999, c. 699, Pt. A, §2 (NEW); PL 1999, c. 699, Pt. A, §4 (AFF).]
SECTION HISTORY
PL 1999, c. 699, §A2 (NEW). PL 1999, c. 699, §A4 (AFF).