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90_HB1412
810 ILCS 5/9-507 from Ch. 26, par. 9-507
Amends the Secured Transactions Article of the Uniform
Commercial Code. In provisions giving the debtor a right to
recover an amount not less than the credit service charge
plus 10% of the principal amount of the debt or the time
price differential plus 10% of the cash price if the
collateral is consumer goods and the secured party is not
proceeding in accordance with this Article regarding secured
transactions, provides that the debtor can recover in an
individual action. Effective immediately.
LRB9004774SMdv
LRB9004774SMdv
1 AN ACT to amend the Uniform Commercial Code by changing
2 Section 9-507.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Uniform Commercial Code is amended by
6 changing Section 9-507 as follows:
7 (810 ILCS 5/9-507) (from Ch. 26, par. 9-507)
8 Sec. 9-507. Secured party's liability for failure to
9 comply with this part.
10 (1) If it is established that the secured party is not
11 proceeding in accordance with the provisions of this Part
12 disposition may be ordered or restrained on appropriate terms
13 and conditions. If the disposition has occurred the debtor or
14 any person entitled to notification or whose security
15 interest has been made known to the secured party prior to
16 the disposition has a right to recover from the secured party
17 any loss caused by a failure to comply with the provisions of
18 this Part. If the collateral is consumer goods, the debtor in
19 an individual action has a right to recover in any event an
20 amount not less than the credit service charge plus 10% of
21 the principal amount of the debt or the time price
22 differential plus 10% of the cash price.
23 (2) The fact that a better price could have been
24 obtained by a sale at a different time or in a different
25 method from that selected by the secured party is not of
26 itself sufficient to establish that the sale was not made in
27 a commercially reasonable manner. If the secured party either
28 sells the collateral in the usual manner in any recognized
29 market therefor or if he sells at the price current in such
30 market at the time of his sale or if he has otherwise sold in
31 conformity with reasonable commercial practices among dealers
-2- LRB9004774SMdv
1 in the type of property sold he has sold in a commercially
2 reasonable manner. The principles stated in the two preceding
3 sentences with respect to sales also apply as may be
4 appropriate to other types of disposition. A disposition
5 which has been approved in any judicial proceeding or by any
6 bona fide creditors' committee or representative of creditors
7 shall conclusively be deemed to be commercially reasonable,
8 but this sentence does not indicate that any such approval
9 must be obtained in any case nor does it indicate that any
10 disposition not so approved is not commercially reasonable.
11 (Source: Laws 1961, p. 2101.)
12 Section 99. Effective date. This Act takes effect upon
13 becoming law.