70A-9a-313. When possession by or delivery to secured party perfects security
interest without filing.
(1) Except as otherwise provided in Subsection (2), a secured party may perfect a
security interest in tangible negotiable documents, goods, instruments, money, or tangible chattel
paper by taking possession of the collateral. A secured party may perfect a security interest in
certificated securities by taking delivery of the certificated securities under Section 70A-8-301.
(2) With respect to goods covered by a certificate of title issued by this state, a secured
party may perfect a security interest in the goods by taking possession of the goods only in the
circumstances described in Subsection 70A-9a-316(4).
(3) With respect to collateral other than certificated securities and goods covered by a
document, a secured party takes possession of collateral in the possession of a person other than
the debtor, the secured party, or a lessee of the collateral from the debtor in the ordinary course of
the debtor's business, when:
(a) the person in possession authenticates a record acknowledging that it holds
possession of the collateral for the secured party's benefit; or
(b) the person takes possession of the collateral after having authenticated a record
acknowledging that it will hold possession of collateral for the secured party's benefit.
(4) If perfection of a security interest depends upon possession of the collateral by a
secured party, perfection occurs no earlier than the time the secured party takes possession and
continues only while the secured party retains possession.
(5) A security interest in a certificated security in registered form is perfected by delivery
when delivery of the certificated security occurs under Section 70A-8-301 and remains perfected
by delivery until the debtor obtains possession of the security certificate.
(6) A person in possession of collateral is not required to acknowledge that it holds
possession for a secured party's benefit.
(7) If a person acknowledges that it holds possession for the secured party's benefit:
(a) the acknowledgment is effective under Subsection (3) or Subsection 70A-8-301(1),
even if the acknowledgment violates the rights of a debtor; and
(b) unless the person otherwise agrees or law other than this chapter otherwise provides,
the person does not owe any duty to the secured party and is not required to confirm the
acknowledgment to another person.
(8) A secured party having possession of collateral does not relinquish possession by
delivering the collateral to a person other than the debtor or a lessee of the collateral from the
debtor in the ordinary course of the debtor's business if the person was instructed before the
delivery or is instructed contemporaneously with the delivery:
(a) to hold possession of the collateral for the secured party's benefit; or
(b) to redeliver the collateral to the secured party.
(9) A secured party does not relinquish possession, even if a delivery under Subsection
(8) violates the rights of a debtor. A person to which collateral is delivered under Subsection (8)
does not owe any duty to the secured party and is not required to confirm the delivery to another
person unless the person otherwise agrees or law other than this chapter otherwise provides.
Amended by Chapter 42, 2006 General Session
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Last revised: Thursday, May 28, 2009