§ 25-9-622.  Effect of acceptance of collateral.

(a)        Effect of acceptance. - A secured party's acceptance of collateral in full or partial satisfaction of the obligation it secures:

(1)        Discharges the obligation to the extent consented to by the debtor;

(2)        Transfers to the secured party all of a debtor's rights in the collateral;

(3)        Discharges the security interest or agricultural lien that is the subject of the debtor's consent and any subordinate security interest or other subordinate lien; and

(4)        Terminates any other subordinate interest.

(b)        Discharge of subordinate interest notwithstanding noncompliance. - A subordinate interest is discharged or terminated under subsection (a) of this section, even if the secured party fails to comply with this Article. (2000-169, s. 1.)