Montana Code 30-9A-607. Collection and enforcement by secured party
30-9A-607. Collection and enforcement by secured party. (1) If so agreed, and in any event on default, a secured party:
Terms Used In Montana Code 30-9A-607
- Account debtor: means a person obligated on an account, chattel paper, or general intangible. See Montana Code 30-9A-102
- Bank: means an organization that is engaged in the business of banking. See Montana Code 30-9A-102
- Collateral: means the property subject to a security interest or agricultural lien. See Montana Code 30-9A-102
- Debtor: means :
(i)a person having a property interest, other than a security interest or other lien, in the collateral, whether or not the person is an obligor;
(ii)a seller of accounts, chattel paper, payment intangibles, or promissory notes; or
(iii)a consignee. See Montana Code 30-9A-102
- Deposit account: means a demand, time, savings, passbook, or similar account maintained with a bank. See Montana Code 30-9A-102
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Mortgage: means a consensual interest in real property, including fixtures, that is created by a mortgage, trust deed, or similar transaction. See Montana Code 30-9A-102
- 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)owes payment or other performance of the obligation;
(B)has provided property other than the collateral to secure payment or other performance of the obligation; or
(C)is otherwise accountable in whole or in part for payment or other performance of the obligation. See Montana Code 30-9A-102
- Person: includes a corporation or other entity as well as a natural person. See Montana Code 1-1-201
- Property: means real and personal property. See Montana Code 1-1-205
- Recourse: An arrangement in which a bank retains, in form or in substance, any credit risk directly or indirectly associated with an asset it has sold (in accordance with generally accepted accounting principles) that exceeds a pro rata share of the bank's claim on the asset. If a bank has no claim on an asset it has sold, then the retention of any credit risk is recourse. Source: FDIC
- Secured party: means :
(i)a person in whose favor a security interest is created or provided for under a security agreement, whether or not any obligation to be secured is outstanding;
(ii)a person that holds an agricultural lien;
(iii)a consignor;
(iv)a person to which accounts, chattel paper, payment intangibles, or promissory notes have been sold;
(v)a trustee, indenture trustee, agent, collateral agent, or other representative in whose favor a security interest or agricultural lien is created or provided for; or
(vi)a person that holds a security interest arising under 30-2-401, 30-2-505, 30-2-711(3), 30-2A-508(5), 30-4-208, or 30-5-118. See Montana Code 30-9A-102
- Security agreement: means an agreement that creates or provides for a security interest. See Montana Code 30-9A-102
(a)may notify an account debtor or other person obligated on collateral to make payment or otherwise render performance to or for the benefit of the secured party;
(b)may take any proceeds to which the secured party is entitled under 30-9A-315;
(c)may enforce the obligations of an account debtor or other person obligated on collateral and exercise the rights and remedies of the debtor with respect to the obligation of the account debtor or other person obligated on collateral to make payment or otherwise render performance to the debtor and with respect to any property that secures the obligations of the account debtor or other person obligated on the collateral;
(d)if it holds a security interest in a deposit account perfected by control under 30-9A-104(1)(a), may apply the balance of the deposit account to the obligation secured by the deposit account; and
(e)if it holds a security interest in a deposit account perfected by control under 30-9A-104(1)(b) or (1)(c), may instruct the bank to pay the balance of the deposit account to or for the benefit of the secured party.
(2)If necessary to enable a secured party to exercise under subsection (1)(c) the right of a debtor to enforce nonjudicially any mortgage, the secured party may record in the office in which the mortgage is recorded:
(a)a copy of the security agreement that creates or provides for a security interest in the obligation secured by the mortgage; and
(b)the secured party’s sworn affidavit in recordable form stating that:
(i)a default has occurred with respect to the obligation secured by the mortgage; and
(ii)the secured party is entitled to enforce the mortgage nonjudicially.
(3)A secured party shall proceed in a commercially reasonable manner if the secured party:
(a)undertakes to collect from or enforce an obligation of an account debtor or other person obligated on collateral; and
(b)is entitled to charge back uncollected collateral or otherwise to full or limited recourse against the debtor or a secondary obligor.
(4)A secured party may deduct from the collections made pursuant to subsection (3) reasonable expenses of collection and enforcement, including reasonable attorneys fees and legal expenses incurred by the secured party.
(5)This section does not determine whether an account debtor, bank, or other person obligated on collateral owes a duty to a secured party.