Current through 2024 Legislative Session Act Chapter 531
Section 9-205 - Use or disposition of collateral permissible(a) When security interest not invalid or fraudulent. -- A security interest is not invalid or fraudulent against creditors solely because: (1) the debtor has the right or ability to: (A) use, commingle, or dispose of all or part of the collateral, including returned or repossessed goods;(B) collect, compromise, enforce, or otherwise deal with collateral;(C) accept the return of collateral or make repossessions; or(D) use, commingle, or dispose of proceeds; or(2) the secured party fails to require the debtor to account for proceeds or replace collateral.(b) Requirements of possession not relaxed. -- This section does not relax the requirements of possession if attachment, perfection, or enforcement of a security interest depends upon possession of the collateral by the secured party. 72 Del. Laws, c. 401, § 1.;