§ 25-9-626. Action in which deficiency or surplus is in issue. - North Carolina Statutes

§25‑9‑626.  Action in which deficiency or surplus is in issue.

(a)        Applicable rules ifamount of deficiency or surplus in issue. – In an action arising from atransaction, other than a consumer transaction, in which the amount of adeficiency or surplus is in issue, the following rules apply:

(1)        A secured party neednot prove compliance with the provisions of this Part relating to collection,enforcement, disposition, or acceptance unless the debtor or a secondaryobligor places the secured party's compliance in issue.

(2)        If the securedparty's compliance is placed in issue, the secured party has the burden ofestablishing that the collection, enforcement, disposition, or acceptance wasconducted in accordance with this Part.

(3)        Except as otherwiseprovided in G.S. 25‑9‑628, if a secured party fails to prove thatthe collection, enforcement, disposition, or acceptance was conducted inaccordance with the provisions of this Part relating to collection,enforcement, disposition, or acceptance, the liability of a debtor or asecondary obligor for a deficiency is limited to an amount by which the sum ofthe secured obligation, expenses, and attorney's fees exceeds the greater of:

a.         The proceeds of thecollection, enforcement, disposition, or acceptance; or

b.         The amount ofproceeds that would have been realized had the noncomplying secured partyproceeded in accordance with the provisions of this Part relating tocollection, enforcement, disposition, or acceptance.

(4)        For purposes of sub‑subdivision(a)(3)b. of this section, the amount of proceeds that would have been realizedis equal to the sum of the secured obligation, expenses, and attorney's feesunless the secured party proves that the amount is less than that sum.

(5)        If a deficiency orsurplus is calculated under G.S. 25‑9‑615(f), the debtor or obligorhas the burden of establishing that the amount of proceeds of the dispositionis significantly below the range of prices that a complying disposition to aperson other than the secured party, a person related to the secured party, ora secondary obligor would have brought.

(b)        Nonconsumertransactions; no inference. – The limitation of the rules in subsection (a) ofthis section to transactions other than consumer transactions is intended toleave to the court the determination of the proper rules in consumertransactions. The court may not infer from that limitation the nature of theproper rule in consumer transactions and may continue to apply establishedapproaches. (2000‑169, s. 1.)