North Dakota Code 41-09-35 – (9-315) Secured party’s rights on disposition of collateral and in proceeds
1. Except as otherwise provided in this chapter and in subsection 2 of section 41-02-48:
Terms Used In North Dakota Code 41-09-35
- Authorized: when used with reference to a financing statement record, means that the financing statement record was filed by a person authorized to do so as provided in sections 41-09-80 and 41-09-130. See North Dakota Code 41-10-01
- Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
- following: when used by way of reference to a chapter or other part of a statute means the next preceding or next following chapter or other part. See North Dakota Code 1-01-49
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Lien: A claim against real or personal property in satisfaction of a debt.
- Property: includes property, real and personal. See North Dakota Code 1-01-49
a. A security interest or agricultural lien continues in collateral notwithstanding sale, lease, license, exchange, or other disposition thereof unless the secured party authorized the disposition free of the security interest or agricultural lien; and
b. A security interest attaches to any identifiable proceeds of collateral.
2. Proceeds that are commingled with other property are identifiable proceeds:
a. If the proceeds are goods, to the extent provided by section 41-09-56; and
b. If the proceeds are not goods, to the extent that the secured party identifies the proceeds by a method of tracing, including application of equitable principles, that is permitted under law other than this chapter with respect to commingled property of the type involved.
3. A security interest in proceeds is a perfected security interest if the security interest in the original collateral was perfected.
4. A perfected security interest in proceeds becomes unperfected on the twenty-first day after the security interest attaches to the proceeds unless:
a. The following conditions are satisfied:
(1) A filed financing statement covers the original collateral; (2) The proceeds are collateral in which a security interest may be perfected by filing in the office in which the financing statement has been filed; and
(3) The proceeds are not acquired with cash proceeds; b. The proceeds are identifiable cash proceeds; or
c. The security interest in the proceeds is perfected other than under subsection 3 when the security interest attaches to the proceeds or within twenty days thereafter.
5. If a filed financing statement covers the original collateral, a security interest in proceeds which remains perfected under subdivision a of subsection 4 becomes unperfected at the later of:
a. When the effectiveness of the filed financing statement lapses under section 41-09-86 or is terminated under section 41-09-84; or
b. The twenty-first day after the security interest attaches to the proceeds.