§ 9-620. Acceptance of collateral in full or partial satisfaction of obligation; notification of proposal; effect of acceptance; compulsory disposition of collateral.
A. Proposal to Accept Collateral in Full or Partial Satisfaction of Obligation. Except as provided in subsection (E) of this section, a secured party may, after default, propose to retain the collateral in full satisfaction of the obligation it secures or, in a transaction other than a consumer transaction, in partial satisfaction of such obligation.
B. Notification of Proposal to Accept Collateral. The secured party shall send notice of such proposal to:
1. The debtor;
2. Any person from whom the secured party has received, before the debtor consented to the acceptance, a signed notification of a claim of an interest in the collateral;
3. Any person that, fourteen (14) calendar days before the debtor consented to the acceptance, held a security interest in or other lien on the collateral perfected by means of a financing statement or compliance with other law (27A ONC § 9-311(A)) that makes such interest reasonably discoverable; and
4. If the proposal is for partial satisfaction of the obligation, any secondary obligor.
C. Conditions to Acceptance. The proposal is not effective unless it is covered by subsection (A) of this section and:
1. The debtor consents to the acceptance in a record signed after default;
2. No other person specified in subsection (B) of this section, and no other person holding an interest in the collateral subject to the secured party’s interest, objects to the acceptance within fourteen (14) Tribal business days after notification was sent;
3. If the collateral is consumer goods, the collateral is not in the possession of the debtor when the debtor consents to the acceptance.
D. Effect of Acceptance. A secured party’s acceptance of collateral pursuant to this section:
1. Discharges the obligation to the extent consented to by the debtor;
2. Transfers to the secured party all of the debtor’s rights in the collateral;
3. Discharges the security interest that is the subject of the debtor’s consent, and any security interest or other lien or interest that is subordinate thereto, even if the secured party accepting the collateral fails to comply with this article.
E. Mandatory Disposition of Consumer Goods. A secured party that has taken possession of collateral shall dispose of the collateral pursuant to 27A ONC §§ 9-610 through 9-616 if:
1. Sixty percent (60%) of the cash price has been paid in the case of a purchase-money security interest in consumer goods; or
2. Sixty percent (60%) of the principal amount of the obligation secured has been paid in the case of a non-purchase-money security interest in consumer goods. Such disposition shall be made within ninety (90) calendar days after taking possession, or within any longer period to which the debtor and all secondary obligors have agreed in an agreement to that effect entered into and signed after default. ONCA 07-22, eff. June 18, 2007.