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336.9-507 Effect of certain events on effectiveness of financing statement.

(a) Disposition. A filed financing statement remains effective with respect to collateral that is sold, exchanged, leased, licensed, or otherwise disposed of and in which a security interest or agricultural lien continues, even if the secured party knows of or consents to the disposition.

(b) Information becoming seriously misleading. Except as otherwise provided in subsection (c) and section 336.9-508, a financing statement is not rendered ineffective if, after the financing statement is filed, the information provided in the financing statement becomes seriously misleading under section 336.9-506.

(c) Change in debtor's name. If a debtor so changes its name that a filed financing statement becomes seriously misleading under section 336.9-506:

(1) the financing statement is effective to perfect a security interest in collateral acquired by the debtor before, or within four months after, the change; and

(2) the financing statement is not effective to perfect a security interest in collateral acquired by the debtor more than four months after the change, unless an amendment to the financing statement which renders the financing statement not seriously misleading is filed within four months after the change.

HIST: 2000 c 399 art 1 s 78

* NOTE: This section, as added by Laws 2000, chapter 399, *article 1, section 78, is effective July 1, 2001. Laws 2000, *chapter 399, article 1, section 130.

* NOTE: Minnesota Statutes 1998, section 336.9-507, which *reads as follows, is repealed July 1, 2001. Laws 2000, chapter *399, article 1, section 130.

* "336.9-507 Secured party's liability for failure to *comply with this part.

* (1) If it is established that the secured party is not *proceeding in accordance with the provisions of this part *disposition may be ordered or restrained on appropriate terms *and conditions. If the disposition has occurred the debtor or *any person entitled to notification or whose security interest *has been made known to the secured party prior to the *disposition has a right to recover from the secured party any *loss caused by a failure to comply with the provisions of this *part. If the collateral is consumer goods, the debtor has a *right to recover in any event an amount not less than the credit *service charge plus ten percent of the principal amount of the *debt or the time price differential plus ten percent of the cash *price.

* (2) The fact that a better price could have been obtained *by a sale at a different time or in a different method from that *selected by the secured party is not of itself sufficient to *establish that the sale was not made in a commercially *reasonable manner. If the secured party either sells the *collateral in the usual manner in any recognized market therefor *or if the secured party sells at the price current in such *market at the time of the sale or if the secured party has *otherwise sold in conformity with reasonable commercial *practices among dealers in the type of property sold the sale *has been made in a commercially reasonable manner. The *principles stated in the two preceding sentences with respect to *sales also apply as may be appropriate to other types of *disposition. A disposition which has been approved in any *judicial proceeding or by any bona fide creditors' committee or *representative of creditors shall conclusively be deemed to be *commercially reasonable, but this sentence does not indicate *that any such approval must be obtained in any case nor does it *indicate that any disposition not so approved is not *commercially reasonable."

Official Publication of the State of Minnesota
Revisor of Statutes