N.Y. Uniform Commercial Code Law § 9-628: Nonliability and Limitation on Liability of Secured Party; Liability of Secondary Obligor

Section 9--628. Nonliability and Limitation on Liability of Secured

Party; Liability of Secondary Obligor.

(a) Limitation of liability of secured party for noncompliance with

article. 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

article; and

(2) the secured party's failure to comply with this article 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 that 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 Section 9--625 (c) (2) for its failure to

comply with Section 9--616.

(e) Limitation of multiple liability for statutory damages. A secured

party is not liable under Section 9--625 (c) (2) more than once with

respect to any one secured obligation.