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Texas Business & Commerce Code - Section 9.628. Nonliability And Limitation On Liability Of Secured Party; Liability Of Secondary Obligor

Legal Research Home > Texas Laws > Business & Commerce Code > Texas Business & Commerce Code - Section 9.628. Nonliability And Limitation On Liability Of Secured Party; Liability Of Secondary Obligor

§ 9.628. NONLIABILITY AND LIMITATION ON LIABILITY OF 
SECURED PARTY;  LIABILITY OF SECONDARY OBLIGOR.  (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 
Section 9.625(c)(2) for its failure to comply with Section 9.616.
	(e)  A secured party is not liable under Section 9.625(c)(2) 
more than once with respect to any one secured obligation.

Added by Acts 1999, 76th Leg., ch. 414, § 1.01, eff. July 1, 
2001.       

Last modified: August 11, 2007