Ark. Code Ann. § 4-9-621 (2020)
Notification of proposal to accept collateral
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A secured party that desires to accept collateral in full or partial satisfaction of the obligation it secures shall send its proposal to:
- any person from which the secured party has received, before the debtor consented to the acceptance, an authenticated notification of a claim of an interest in the collateral;
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any other secured party or lienholder that, ten (10) days before the debtor consented to the acceptance, held a security interest in or other lien on the collateral perfected by the filing of a financing statement that:
- identified the collateral;
- was indexed under the debtor's name as of that date; and
- was filed in the office or offices in which to file a financing statement against the debtor covering the collateral as of that date; and
- any other secured party that, ten (10) days before the debtor consented to the acceptance, held a security interest in the collateral perfected by compliance with a statute, regulation, or treaty described in § 4-9-311(a).
- A secured party that desires to accept collateral in partial satisfaction of the obligation it secures shall send its proposal to any secondary obligor in addition to the persons described in subsection (a).
History. Acts 2001, No. 1439, § 1.
Case Notes
Notice.
Letter was not the written notice contemplated in this section, since it was not written by the secured party, it did not notify debtor that creditor intended to retain the collateral in satisfaction of the obligation, and the secured party was not in possession of the equipment; thus, the secured party was required to dispose of the collateral and account for any surplus to the debtor under former § 4-9-504, and, where it failed to do so, the debtor was entitled to recover from the secured party under former § 4-9-507 for failure to comply. McIlroy Bank & Trust v. Seven Day Bldrs. of Ark., Inc., 1 Ark. App. 121, 613 S.W.2d 837 (1981) (decision under prior law).
Cited: Everett v. Parts, Inc., 4 Ark. App. 213, 628 S.W.2d 875 (1982); Ark. Iron & Metal Co. v. First Nat'l Bank, 16 Ark. App. 245, 701 S.W.2d 380 (1985); Pollack v. Pulaski Bank & Trust Co., 30 Ark. App. 20, 781 S.W.2d 497 (1989); Smith v. Paul, 317 Ark. 182, 876 S.W.2d 266 (1994) (decisions under prior law).