Other Law Commons^™

Searching For Commercial Reasonableness Under The Revised Article 9, Michael Korybut

All Faculty Scholarship

Under U.C.C. Article 9, a secured party selling repossessed collateral must conduct a commercially reasonable sale. Under the old Article 9, courts and commentators debated the question of whether the foreclosure sale process and its procedural regularity should measure the sale's commercial reasonableness or whether instead the main focus of inquiry should be the reasonableness of the proceeds produced by the sale. This question spawned conflicting and non-uniform judicial approaches, most simply described as the "procedures test" versus "proceeds test."

In 2001 Article 9 was revised. The revisions included changes that addressed, but did not explicitly resolve, the question of …

Online Auctions Of Repossessed Collateral Under Article 9, Michael Korybut

All Faculty Scholarship

Under U.C.C. Article 9, a secured creditor selling repossessed collateral must do so in a commercially reasonable manner. A traditional form of foreclosure sale is an auction conducted by a professional auctioneer. With the rapid growth of online auctions like eBay, secured parties may want to use the new platform to sell their collateral. But conceived in the 1940s, Article 9 was not drafted with the Internet in mind. The secured creditor will face many novel issues, including whether the defining characteristics distinguishing a real-world public sale from a private sale remain coherent and applicable in cyberspace; whether an online …