Oregon Statutes 79.0615 – UCC 9-615. Application of proceeds of disposition; liability for deficiency and right to surplus
(1) A secured party shall apply or pay over for application the cash proceeds of disposition under ORS § 79.0610 in the following order to:
Terms Used In Oregon Statutes 79.0615
- Agricultural lien: means an interest, other than a security interest or a lien created under ORS § 87. See Oregon Statutes 79.0102
- Cash proceeds: means proceeds that are money, checks, deposit accounts or the like. See Oregon Statutes 79.0102
- 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 software used in the 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 Oregon Statutes 79.0102
- Collateral: means the property subject to a security interest or agricultural lien. See Oregon Statutes 79.0102
- Consignor: means a person that delivers goods to a consignee in a consignment. See Oregon Statutes 79.0102
- Lien: A claim against real or personal property in satisfaction of a debt.
- Noncash proceeds: means proceeds other than cash proceeds. See Oregon Statutes 79.0102
- 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:
(i) Owes payment or other performance of the obligation;
(ii) Has provided property other than the collateral to secure payment or other performance of the obligation; or
(iii) Is otherwise accountable in whole or in part for payment or other performance of the obligation. See Oregon Statutes 79.0102
- Person: includes individuals, corporations, associations, firms, partnerships, limited liability companies and joint stock companies. See Oregon Statutes 174.100
- Secondary obligor: means an obligor to the extent that:
(A) The obligor's obligation is secondary; or
(B) The obligor has a right of recourse with respect to an obligation secured by collateral against the debtor, another obligor, or property of either. See Oregon Statutes 79.0102
(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 fees and legal expenses incurred by the secured party;
(b) The satisfaction of obligations secured by the security interest or agricultural lien under which the disposition is made;
(c) The satisfaction of obligations secured by any subordinate security interest in or other subordinate lien on the collateral if:
(A) 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
(B) 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
(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.
(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)(c) of this section.
(3) A secured party need not apply or pay over for application noncash proceeds of disposition under ORS § 79.0610 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.
(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) of this section and permitted by subsection (3) of this section:
(a) Unless subsection (1)(d) of this section 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
(b) The obligor is liable for any deficiency.
(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
(b) The obligor is not liable for any deficiency.
(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 ORS § 79.0601 to 79.0628 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
(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.
(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;
(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
(c) Is not obligated to account to or pay the holder of the security interest or other lien for any surplus. [2001 c.445 § 113]