Texas Business & Commerce Code
§ 9.608 — APPLICATION OF PROCEEDS OF COLLECTION OR ENFORCEMENT; LIABILITY FOR DEFICIENCY AND RIGHT TO SURPLUS
BC § 9.608Title 1. UNIFORM COMMERCIAL CODE · Ch. 9. SECURED TRANSACTIONS · Art. F. DEFAULT
Statute text
View on source(a)If a security interest or agricultural lien secures payment or performance of an obligation, the following rules apply:
(1)A secured party shall apply or pay over for application the cash proceeds of collection or enforcement under Section 9.607 in the following order to:
(A)the reasonable expenses of collection and enforcement and, to the extent provided for by agreement and not prohibited by law, reasonable attorney's fees and legal expenses incurred by the secured party;
(B)the satisfaction of obligations secured by the security interest or agricultural lien under which the collection or enforcement is made; and
(C)the satisfaction of obligations secured by any subordinate security interest in or other lien on the collateral subject to the security interest or agricultural lien under which the collection or enforcement is made if the secured party receives an authenticated demand for proceeds before distribution of the proceeds is completed.
(2)If requested by a secured party, a holder of a subordinate security interest or other lien shall furnish reasonable proof of the interest or lien within a reasonable time. Unless the holder complies, the secured party need not comply with the holder's demand under Subdivision (1)(C).
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Legislative history
Added by Acts 1999, 76th Leg., ch. 414, Sec. 1.01, eff. July 1, 2001. Amended by Acts 2001, 77th Leg., ch. 705, Sec. 19, eff. June 13, 2001.