Also known as: account statements · statements of account · statement of account
Written by attorneys · grounded in primary & secondary sources — see below
A record signed by a debtor requesting that the recipient approve or correct a statement indicating the aggregate amount of unpaid obligations secured by collateral as of a specified date and reasonably identifying the transaction or relationship that is the subject of the request.
Anchor Bank held a security interest in Amelia Amari's equipment to secure a loan. Amelia sent Anchor a signed record stating her belief that the unpaid balance was $45,000 as of June 1 and asking the bank to approve or correct that figure. Anchor replied within fourteen days with a signed letter confirming the balance at $47,200 after adding accrued interest.
Avalon Pharmaceuticals borrowed from Alliance Holdings using its patents as collateral. Avalon prepared and signed a record listing the outstanding secured debt at $1.2 million as of March 15 and identifying the loan agreement. The record asked Alliance to approve or correct the stated amount before Avalon pursued refinancing.
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The secured party must sign and send the debtor an approval or correction of the statement within fourteen days after receipt. The response must address the aggregate unpaid obligations secured by the collateral as of the date specified in the request.
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No. The secured party satisfies its duty by signing and sending an approval or correction of the debtor's proposed statement. The response need not restate every transaction if it adequately approves or corrects the aggregate balance and identifies the relevant relationship.
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The secured party violates its statutory duty under Article 9. The debtor may then pursue remedies available for the secured party's noncompliance with information requests, including potential liability for resulting damages.
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