Legislation
SECTION 9-625
Remedies for Secured Party's Failure to Comply with Article
Uniform Commercial Code (UCC) CHAPTER 38, ARTICLE 9, PART 6, SUBPART 2
Section 9--625. Remedies for Secured Party's Failure to Comply with
Article.
(a) Judicial orders concerning noncompliance. If it is established
that a secured party is not proceeding in accordance with this article,
a court may order or restrain collection, enforcement, or disposition of
collateral on appropriate terms and conditions.
(b) Damages for noncompliance. Subject to subsections (c), (d), and
(f), a person is liable for damages in the amount of any loss caused by
a failure to comply with this article. Loss caused by a failure to
comply may include loss resulting from the debtor's inability to obtain,
or increased costs of, alternative financing.
(c) Persons entitled to recover damages; statutory damages if
collateral is consumer goods. Except as otherwise provided in Section
9--628:
(1) a person that, at the time of the failure, was a debtor, was
an obligor, or held a security interest in or other lien on
the collateral may recover damages under subsection (b) for
its loss; and
(2) if the collateral is consumer goods, a person that was a
debtor or a secondary obligor at the time a secured party
failed to comply with this part may recover for that failure
in any event an amount not less than the credit service
charge plus 10 percent of the principal amount of the
obligation or the time-price differential plus 10 percent of
the cash price.
(d) Recovery when deficiency eliminated or reduced. A debtor whose
deficiency is eliminated under Section 9--626 may recover damages for
the loss of any surplus. However, a debtor or secondary obligor whose
deficiency is eliminated or reduced under Section 9--626 may not
otherwise recover under subsection (b) for noncompliance with the
provisions of this part relating to collection, enforcement,
disposition, or acceptance.
(e) Statutory damages: noncompliance with specified provisions. In
addition to any damages recoverable under subsection (b), the debtor,
consumer obligor, or person named as a debtor in a filed record, as
applicable, may recover five hundred dollars in each case from a person
that:
(1) fails to comply with Section 9--208;
(2) fails to comply with Section 9--209;
(3) files a record that the person is not entitled to file under
Section 9--509 (a);
(4) fails to cause the secured party of record to file or send a
termination statement as required by Section 9--513 (a), (c),
or (e);
(5) fails to comply with Section 9--616 (b) (1) and whose failure
is part of a pattern, or consistent with a practice, of
noncompliance; or
(6) fails to comply with Section 9--616 (b) (2).
(f) Statutory damages: noncompliance with Section 9--210. A debtor or
consumer obligor may recover damages under subsection (b) and, in
addition, five hundred dollars in each case from a person that, without
reasonable cause, fails to comply with a request under Section 9--210. A
recipient of a request under Section 9--210 which never claimed an
interest in the collateral or obligations that are the subject of a
request under that section has a reasonable excuse for failure to comply
with the request within the meaning of this subsection.
(g) Limitation of security interest: noncompliance with Section
9--210. If a secured party fails to comply with a request regarding a
list of collateral or a statement of account under Section 9--210, the
secured party may claim a security interest only as shown in the list or
statement included in the request as against a person that is reasonably
misled by the failure.
Article.
(a) Judicial orders concerning noncompliance. If it is established
that a secured party is not proceeding in accordance with this article,
a court may order or restrain collection, enforcement, or disposition of
collateral on appropriate terms and conditions.
(b) Damages for noncompliance. Subject to subsections (c), (d), and
(f), a person is liable for damages in the amount of any loss caused by
a failure to comply with this article. Loss caused by a failure to
comply may include loss resulting from the debtor's inability to obtain,
or increased costs of, alternative financing.
(c) Persons entitled to recover damages; statutory damages if
collateral is consumer goods. Except as otherwise provided in Section
9--628:
(1) a person that, at the time of the failure, was a debtor, was
an obligor, or held a security interest in or other lien on
the collateral may recover damages under subsection (b) for
its loss; and
(2) if the collateral is consumer goods, a person that was a
debtor or a secondary obligor at the time a secured party
failed to comply with this part may recover for that failure
in any event an amount not less than the credit service
charge plus 10 percent of the principal amount of the
obligation or the time-price differential plus 10 percent of
the cash price.
(d) Recovery when deficiency eliminated or reduced. A debtor whose
deficiency is eliminated under Section 9--626 may recover damages for
the loss of any surplus. However, a debtor or secondary obligor whose
deficiency is eliminated or reduced under Section 9--626 may not
otherwise recover under subsection (b) for noncompliance with the
provisions of this part relating to collection, enforcement,
disposition, or acceptance.
(e) Statutory damages: noncompliance with specified provisions. In
addition to any damages recoverable under subsection (b), the debtor,
consumer obligor, or person named as a debtor in a filed record, as
applicable, may recover five hundred dollars in each case from a person
that:
(1) fails to comply with Section 9--208;
(2) fails to comply with Section 9--209;
(3) files a record that the person is not entitled to file under
Section 9--509 (a);
(4) fails to cause the secured party of record to file or send a
termination statement as required by Section 9--513 (a), (c),
or (e);
(5) fails to comply with Section 9--616 (b) (1) and whose failure
is part of a pattern, or consistent with a practice, of
noncompliance; or
(6) fails to comply with Section 9--616 (b) (2).
(f) Statutory damages: noncompliance with Section 9--210. A debtor or
consumer obligor may recover damages under subsection (b) and, in
addition, five hundred dollars in each case from a person that, without
reasonable cause, fails to comply with a request under Section 9--210. A
recipient of a request under Section 9--210 which never claimed an
interest in the collateral or obligations that are the subject of a
request under that section has a reasonable excuse for failure to comply
with the request within the meaning of this subsection.
(g) Limitation of security interest: noncompliance with Section
9--210. If a secured party fails to comply with a request regarding a
list of collateral or a statement of account under Section 9--210, the
secured party may claim a security interest only as shown in the list or
statement included in the request as against a person that is reasonably
misled by the failure.