Nonliability and limitation on liability of secured party - liability of secondary obligor

4-9-628. Nonliability and limitation on liability of secured party - liability of secondary obligor. (a) Subject to subsection (f) of this section, unless a secured party knows that a person is a debtor or obligor, knows the identity of the person, and knows how to communicate with the person: (1) The secured party is not liable to the person, or to a secured party or lienholder that has filed a financing statement against the person, for failure to comply with this article; and (2) The secured party's failure to comply with this article does not affect the liability of the person for a deficiency. (b) Subject to subsection (f) of this section, a secured party is not liable because of its status as secured party: (1) To a person that is a debtor or obligor, unless the secured party knows: (A) That the person is a debtor or obligor; (B) The identity of the person; and (C) How to communicate with the person; or (2) To a secured party or lienholder that has filed a financing statement against a person, unless the secured party knows: (A) That the person is a debtor; and (B) The identity of the person. (c) A secured party is not liable to any person, and a person's liability for a deficiency is not affected, because of any act or omission arising out of the secured party's reasonable belief that a transaction is not a consumer-goods transaction or a consumer transaction or that goods are not consumer goods, if the secured party's belief is based on its reasonable reliance on: (1) A record authenticated by the debtor concerning the purpose for which collateral was to be used, acquired, or held, or indicating that collateral is not a consumer deposit account; or (2) A record authenticated by the obligor concerning the purpose for which a secured obligation was incurred. (d) (1) A secured party is not liable under section 4-9-625 (c)(2) for its failure to comply with section 4-9-616. (2) Repealed. (e) A secured party is not liable under section 4-9-625 (c)(2) more than once with respect to any one secured obligation. (f) Subsections (a) and (b) of this section do not apply to limit the liability of a secured party to a person if, at the time the secured party obtains control of collateral that is a controllable account, controllable electronic record, or controllable payment intangible or at the time the security interest attaches to the collateral, whichever is later: (1) The person is a debtor or obligor; and (2) The secured party knows that the information in subsection (b)(1)(A), (b)(1)(B), or (b)(1)(C) of this section relating to the person is not provided by the collateral, a record attached to or logically associated with the collateral, or the system in which the collateral is recorded. Source: L. 2001: Entire article R&RE, p. 1421, � 1, effective July 1. L. 2002: (d)(2) repealed, p. 939, � 9, effective August 7. L. 2023: IP(a) and IP(b) amended and (f) added, (SB 23-090), ch. 136, p. 568, � 88, effective August 7. Editor's note - Colorado legislative change: Colorado substituted the phrase A record authenticated by the debtor for the phrase A debtor's representation and added the phrase or indicating that collateral is not a consumer deposit account in subsection (c)(1), substituted the phrase A record authenticated by the obligor for the phrase An obligor's representation in subsection (c)(2), and did not adopt subsection (d) of the uniform act. The uniform act's subsection (e) states: A secured party is not liable under section 4-9-625(c)(2) more than once with respect to any one secured obligation.