Current through Pa Acts 2024-53, 2024-56 through 2024-111
Section 9205 - Use or disposition of collateral permissible(a) When security interest not invalid or fraudulent.--A security interest is not invalid or fraudulent against creditors solely because any of the following apply: (1) The debtor has the right or ability to: (i) use, commingle or dispose of all or part of the collateral, including returned or repossessed goods;(ii) collect, compromise, enforce or otherwise deal with collateral;(iii) accept the return of collateral or make repossessions; or(iv) use, commingle or dispose of proceeds.(2) The secured party fails to require the debtor to account for proceeds or replace collateral.(b) Requirements of possession not relaxed.--This section does not relax the requirements of possession if attachment, perfection or enforcement of a security interest depends upon possession of the collateral by the secured party.2001, June 8, P.L. 123, No. 18, § 16, effective 7/1/2001.