Welcome to the on-line
August issue of the
Community Bankers' Advisor
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The Advisor is
prepared by attorneys at Olson & Burns, P.C. to provide information
pertaining to legal developments affecting the field of banking.
In order to accomplish this objective, we welcome any comments
our readers have regarding the content and format of this publication.
Please address your comments to:
Community Bankers' Advisor
c/o
Olson & Burns, P.C.
PO Box 1180
Minot, ND 58702-1180
email: Olson & Burns P.C.
The attorneys
at Olson & Burns represent a wide range of clients in the financial
and commercial areas. Our attorneys have expertise in banking
regulations, employment law, bank charter issues, bankruptcy,
commercial paper, real estate, probate, and UCC matters. |
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You are asking. . .
Q.We are going to sell personal property collateral
that secured a loan. Do we have to give the guarantor notice
of the sale when he waived his right to notice in the guaranty?
A.
Yes. He must receive notice. Case law has established that a
guarantor is a "debtor" for purposes of Article 9 of
the U.C.C., and as such, is unable to waive the protections afforded
under U.C.C. § 9-504(3) (N.D.C.C. § 41-09-05(3)). Accordingly,
before default, the guarantor cannot validly waive his right
to notice of disposition of the collateral, he cannot waive the
creditor's duty to sell the collateral in a commercially reasonable
manner, nor can the debtor waive the creditor's duty to act in
good faith.
Q. I know that a security interest is indicated on the
title, but are there any additional procedures required to obtain
and perfect a purchase money security interest in a snowmobile?
A. Because recreational vehicles
such as snowmobiles are "motor vehicles" under North
Dakota law, they must have the security interest clearly indicated
upon the certificate of title to the vehicle, unless such certificate
of title is in the possession of the secured party.
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