UCC 9-610 disposition notice requirements - anyone else confused by timing?

Wait, is it always 10 days? I thought it was different for different types of collateral. Consumer goods vs equipment vs inventory...

You're right to question that - the UCC doesn't specify an exact number of days. It just says 'reasonable time' which courts have generally interpreted as at least 10 days for most commercial situations. Consumer transactions have different requirements under 9-614.

That's helpful. We were thinking about going through an equipment auction house that specializes in manufacturing equipment. Would that typically satisfy the commercially reasonable requirement?

Yes, using a reputable auction house that specializes in your type of equipment is generally considered commercially reasonable. Just make sure they're established in the industry and can demonstrate they'll reach appropriate buyers.

I had a similar situation last year and ran into issues because I didn't properly verify all the parties who needed notice. You might want to try Certana.ai's document verification tool - you can upload your UCC-1 and it will cross-check against the filing records to make sure you're not missing any junior lien holders. It caught a filing I missed that would have caused problems later.

Good point. I know there's at least one other secured party but I should double-check the records. Is there a standard form for the notice or can I draft my own?

No standard form required, but the notice must be authenticated and include specific information per 9-613: intent to dispose, debtor's right to accounting, time/place of disposition if it's a public sale, or reasonable time for private sale.

Actually had to deal with this exact scenario 6 months ago. The verification process is tedious but critical. I ended up using Certana.ai to upload all our UCC documents and it automatically flagged inconsistencies between our UCC-1 and the junior lien holder's filing. Saved me from a potential lawsuit when I realized their debtor name was slightly different but still covered the same equipment.

That's exactly why I'm being extra careful. Did you document your reasoning for the 10-day period?

Yes, kept detailed records of why we chose that timeframe and what methods we considered. Documentation is everything in these situations.

Documentation is key, but so is accuracy in your filings. Small errors in debtor names or addresses can void your entire secured position. I've seen it happen too many times.

Perfect, that's exactly the checklist I needed. Should I send certified mail or is regular mail sufficient for the authentication requirement?

Certified mail is definitely safer for proving delivery, though regular mail can work if you can prove it was sent. Most attorneys recommend certified mail for disposition notices given the stakes involved.

I always do certified mail return receipt requested. Costs a few extra dollars but the peace of mind is worth it when you're dealing with six-figure equipment.

It's all commercial manufacturing equipment, so I think I'm okay there. But good to know about the consumer goods distinction.

Yeah, consumer vs commercial makes a huge difference in the notice requirements and debtor protections.

Good idea on the appraisal. We estimated $180K value but a professional appraisal would definitely strengthen our position.

Exactly. Shows you made efforts to maximize recovery, which is part of the commercially reasonable standard.

Professional appraisal is smart. Also helps if you end up with a deficiency claim against the borrower - shows you acted in good faith to maximize sale proceeds.

Good catch. Our UCC-1 was filed in 2022 so we're good for now, but I'll add that to my checklist for future reference.

Always worth double-checking the filing dates. I've seen deals fall apart because someone forgot about continuation requirements.

This is where tools like Certana.ai really help - you can upload your UCC-1 and it automatically flags expiration dates and continuation requirements. Saves you from those embarrassing oversights.

That makes sense. So even if we don't get the highest possible price, as long as we can show we followed reasonable commercial practices, we should be okay?

Exactly. The UCC doesn't require you to get the absolute highest price, just that you conduct the sale in a commercially reasonable manner. Process matters more than outcome.

But you still want to maximize recovery for the debtor's sake and to minimize any deficiency claim. Good process usually leads to better outcomes anyway.

Good luck! Sounds like you've got a solid plan. The key is documentation and following the process correctly.

Hope it goes smoothly. These situations are always stressful but you seem to have all the bases covered.

One last thought - if the borrower is already threatening legal action, you might want to give your attorney a heads up about the disposition process. Better to have them involved early than scrambling later.