§ 7-9A-622 — Effect of Acceptance of Collateral

Alabama § 7-9A-622

• Jurisdiction: Alabama
• Title 7: Commercial Code
• Art. 9A: Secured Transactions
• Div. 1: Default and Enforcement of Security Interest
• Part 6: Default

Text

(a) Effect of acceptance. A secured party’s acceptance of collateral in full or partial satisfaction of the obligation it secures:
(1) discharges the obligation to the extent consented to by the debtor;
(2) transfers to the secured party all of a debtor’s rights in the collateral;
(3) discharges the security interest or agricultural lien that is the subject of the debtor’s consent and any subordinate security interest or other subordinate lien; and
(4) terminates any other subordinate interest.
(b) Discharge of subordinate interest notwithstanding noncompliance. A subordinate interest is discharged or terminated under subsection (a), even if the secured party fails to comply with this article.

Legislative History

(Act 2001-481, p. 647, §1.)