MISSISSIPPI LEGISLATURE
2011 Regular Session
To: Judiciary A
By: Representative Lane
AN ACT TO PROHIBIT A PROVISION IN A CONTRACT THAT ALLOWS A REPOSSESSING PARTY TO TAKE PROPERTY THAT IS NOT SUBJECT TO THE CONTRACT; TO AMEND SECTIONS 75-9-609 AND 75-9-610, MISSISSIPPI CODE OF 1972, IN CONFORMITY; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. No contract to purchase goods which allows for the repossession of the collateral which is the subject of the contract shall contain a provision which allows the taking of any other property which may be within or on the collateral property. Whenever the collateral is repossessed, the party repossessing the collateral shall return any other property not subject to the contract to the owner within three (3) days of repossession.
SECTION 2. Section 75-9-609, Mississippi Code of 1972, is amended as follows:
75-9-609. (a) After default, a secured party:
(1) May take possession of the collateral; and
(2) Without removal, may render equipment unusable and dispose of collateral on a debtor's premises under Section 75-9-610.
(b) A secured party may proceed under subsection (a):
(1) Pursuant to judicial process; or
(2) Without judicial process, if it proceeds without breach of the peace.
(c) If so agreed, and in any event after default, a secured party may require the debtor to assemble the collateral and make it available to the secured party at a place to be designated by the secured party which is reasonably convenient to both parties. (d) Repossession of collateral shall be subject to the provisions of Section 1 of House Bill No.____, 2011 Regular Session.
SECTION 3. Section 75-9-610, Mississippi Code of 1972, is amended as follows:
75-9-610. (a) After default, a secured party may sell, lease, license, or otherwise dispose of any or all of the collateral in its present condition or following any commercially reasonable preparation or processing.
(b) Every aspect of a disposition of collateral, including the method, manner, time, place, and other terms, must be commercially reasonable. If commercially reasonable, a secured party may dispose of collateral by public or private proceedings, by one or more contracts, as a unit or in parcels, and at any time and place and on any terms.
(c) A secured party may purchase collateral:
(1) At a public disposition; or
(2) At a private disposition only if the collateral is of a kind that is customarily sold on a recognized market or the subject of widely distributed standard price quotations.
(d) A contract for sale, lease, license, or other disposition includes the warranties relating to title, possession, quiet enjoyment, and the like which by operation of law accompany a voluntary disposition of property of the kind subject to the contract.
(e) A secured party may disclaim or modify warranties under subsection (d):
(1) In a manner that would be effective to disclaim or modify the warranties in a voluntary disposition of property of the kind subject to the contract of disposition; or
(2) By communicating to the purchaser a record evidencing the contract for disposition and including an express disclaimer or modification of the warranties.
(f) A record is sufficient to disclaim warranties under subsection (e) if it indicates "There is no warranty relating to title, possession, quiet enjoyment or the like in this disposition" or uses words of similar import.
(g) Repossession of collateral shall be subject to the provisions of Section 1 of House Bill No.____, 2011 Regular Session.
SECTION 4. This act shall take effect and be in force from and after July 1, 2011.