Section 57A-9-628 - Limitations on liability of secured party.
57A-9-628. Limitations on liability of secured party. (a) 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 a secured party or lienholder that has filed a financing statement against the person, for failure to comply with this chapter; and
(2) The secured party's failure to comply with this chapter does not affect the liability of the person for a deficiency.
(b) A secured party is not liable because of its status as secured party:
(1) To a person that is a debtor or obligor, unless the secured party knows:
(A) That the person is a debtor or obligor;
(B) The identity of the person; and
(C) How to communicate with the person; or
(2) To a secured party or lienholder that has filed a financing statement against a person, unless the secured party knows:
(A) That the person is a debtor; and
(B) The identity of the person.
(c) A secured party is not liable to any person, and a person's liability for a deficiency is not affected, because of any act or omission arising out of the secured party's reasonable belief that a transaction is not a consumer-goods transaction or a consumer transaction or that goods are not consumer goods, if the secured party's belief is based on its reasonable reliance on:
(1) A debtor's representation concerning the purpose for which collateral was to be used, acquired, or held; or
(2) An obligor's representation concerning the purpose for which a secured obligation was incurred.
(d) A secured party is not liable to any person under § 57A-9-625(c)(2) for its failure to comply with § 57A-9-616.
(e) A secured party is not liable under § 57A-9-625(c)(2) more than once with respect to any one secured obligation.
Source: SL 2000, ch 231.