Iowa Code 554.9628 – Nonliability and limitation on liability of secured party — liability of secondary obligor
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:
Terms Used In Iowa Code 554.9628
- Account: means the same as defined in section 554. See Iowa Code 554E.1
- Controllable electronic record: means an electronic record that can be subjected to control under any applicable article of the uniform commercial code. See Iowa Code 554E.1
- Controllable payment intangible: means a payment intangible evidenced by a controllable electronic record that provides that the account debtor undertakes to pay a person that under any applicable article of the uniform commercial code has control of the controllable electronic record. See Iowa Code 554E.1
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Electronic: means the same as defined in section 554D. See Iowa Code 554E.1
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- person: means individual, corporation, limited liability company, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, or any other legal entity. See Iowa Code 4.1
- Transaction: means a sale, trade, exchange, transfer, payment, or conversion of a digital asset or any other property or any other action or set of actions occurring between two or more persons relating to the conduct of business, commercial, or governmental affairs. See Iowa Code 554E.1
Subject to subsection 6, a secured party is not liable because of its status as secured party:
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:
A secured party is not liable to any person under section 554.9625, subsection 3, paragraph “b”, for its failure to comply with section 554.9616.
A secured party is not liable under section 554.9625, subsection 3, paragraph “b”, more than once with respect to any one secured obligation.
A secured party owes a duty based on its status as a secured party to a person that is a debtor if, at the time the secured party obtains control of a controllable account, controllable electronic record, or controllable payment intangible, the secured party has knowledge that the nature of the collateral or a system in which the collateral is recorded would prevent the secured party from acquiring the knowledge specified in subsection 2, paragraph “a”, subparagraph (1), (2), or (3).