2016 Kentucky Revised Statutes CHAPTER 355 - UNIFORM COMMERCIAL CODE Article 9 - Secured Transactions -- Sales of Accounts, Contract Rights, and Chattel Paper 355.9-626 Action in which deficiency or surplus is in issue.
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355.9-626 Action in which deficiency or surplus is in issue.
(1)
(2)
In an action arising from a transaction, other than a consumer transaction, in which
the amount of a deficiency or surplus is in issue, the following rules apply:
(a) A secured party need not prove compliance with the provisions of this part of
this article relating to collection, enforcement, disposition, or acceptance
unless the debtor or a secondary obligor places the secured party's compliance
in issue.
(b) If the secured party's compliance is placed in issue, the secured party has the
burden of establishing that the collection, enforcement, disposition, or
acceptance was conducted in accordance with this part of this article.
(c) Except as otherwise provided in KRS 355.9-628, if a secured party fails to
prove that the collection, enforcement, disposition, or acceptance was
conducted in accordance with the provisions of this part of this article relating
to collection, enforcement, disposition, or acceptance, the liability of a debtor
or a secondary obligor for a deficiency is limited to an amount by which the
sum of the secured obligation, expenses, and attorney's fees exceeds the
greater of:
1.
The proceeds of the collection, enforcement, disposition, or acceptance;
or
2.
The amount of proceeds that would have been realized had the
noncomplying secured party proceeded in accordance with the
provisions of this part of this article relating to collection, enforcement,
disposition, or acceptance.
(d) For purposes of paragraph (c)2. of this subsection, the amount of proceeds that
would have been realized is equal to the sum of the secured obligation,
expenses, and attorney's fees unless the secured party proves that the amount
is less than that sum.
(e) If a deficiency or surplus is calculated under KRS 355.9-615(6), the debtor or
obligor has the burden of establishing that the amount of proceeds of the
disposition is significantly below the range of prices that a complying
disposition to a person other than the secured party, a person related to the
secured party, or a secondary obligor would have brought.
The limitation of the rules in subsection (1) of this section to transactions other than
consumer transactions is intended to leave to the court the determination of the
proper rules in consumer transactions. The court may not infer from that limitation
the nature of the proper rule in consumer transactions and may continue to apply
established approaches.
Effective: July 1, 2001
History: Created 2000 Ky. Acts ch. 408, sec. 144, effective July 1, 2001.
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