New York Uniform Commercial Code Law Section 9-208 - Additional Duties of Secured Party Having Control of Collateral.

Section 9--208. Additional Duties of Secured Party Having Control of

Collateral.

(a) Applicability of section. This section applies to cases in which there is no outstanding secured obligation and the secured party is not committed to make advances, incur obligations, or otherwise give value.

(b) Duties of secured party after receiving demand from debtor. Within 10 days after receiving an authenticated demand by the debtor:

(1) a secured party having control of a deposit account under

Section 9--104(a)(2) shall send to the bank with which the

deposit account is maintained an authenticated statement that

releases the bank from any further obligation to comply with

instructions originated by the secured party;

(2) a secured party having control of a deposit account under

Section 9--104(a)(3) shall:

(A) pay the debtor the balance on deposit in the deposit

account; or

(B) transfer the balance on deposit into a deposit account in

the debtor's name;

(3) a secured party, other than a buyer, having control of

electronic chattel paper under Section 9--105 shall:

(A) communicate the authoritative copy of the electronic

chattel paper to the debtor or its designated custodian;

(B) if the debtor designates a custodian that is the

designated custodian with which the authoritative copy of

the electronic chattel paper is maintained for the

secured party, communicate to the custodian an

authenticated record releasing the designated custodian

from any further obligation to comply with instructions

originated by the secured party and instructing the

custodian to comply with instructions originated by the

debtor; and

designated custodian to make copies of or revisions to

the authoritative copy which add or change an identified

assignee of the authoritative copy without the consent of

the secured party;

(4) a secured party having control of investment property under

Section 8--106(d)(2) or 9--106(b) shall send to the

securities intermediary or commodity intermediary with which

the security entitlement or commodity contract is maintained

an authenticated record that releases the securities

intermediary or commodity intermediary from any further

obligation to comply with entitlement orders or directions

originated by the secured party;

(5) a secured party having control of a letter-of-credit right

under Section 9--107 shall send to each person having an

unfulfilled obligation to pay or deliver proceeds of the

letter-of-credit to the secured party an authenticated

release from any further obligation to pay or deliver

proceeds of the letter-of-credit to the secured party; and

(6) a secured party having control of an electronic document

shall:

(A) give control of the electronic document to the debtor or

its designated custodian;

(B) if the debtor designates a custodian that is the

designated custodian with which the authoritative copy of

the electronic document is maintained for the secured

party, communicate to the custodian an authenticated

record releasing the designated custodian from any

further obligation to comply with instructions originated

by the secured party and instructing the custodian to

comply with instructions originated by the debtor; and

designated custodian to make copies of or revisions to

the authoritative copy which add or change an identified

assignee of the authoritative copy without the consent of

the secured party.

Last modified: February 3, 2019