12A:9-628. Nonliability and Limitation on Liability of Secured Party; Liability of Secondary Obligor.

   (a)   Limitation of liability of secured party for noncompliance with chapter. 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)   Limitation of liability based on status as secured party. A secured party is not liable because of its status as secured party:

   (1)   to a person who 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)   Limitation of liability if reasonable belief that transaction not a consumer-goods transaction or consumer transaction. 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)   Limitation of liability for statutory damages. A secured party is not liable to any person under

12A:9-625 (c) (2) for its failure to comply with 12A:9-616.

   (e)   Limitation of multiple liability for statutory damages. A secured party is not liable under 12A:9-625 (c) (2) more than once with respect to any one secured obligation.

   L.2001, c.117, s.1; amended 2001, c.386, s.117.