Georgia § 11-9-205 - Use or disposition of collateral permissible.

§ 11-9-205. Use or disposition of collateral permissible.

When security interest not invalid or fraudulent. A security interest is not invalid or fraudulent against creditors solely because: The debtor has the right or ability to: Use, commingle, or dispose of all or part of the collateral, including returned or repossessed goods; Collect, compromise, enforce, or otherwise deal with collateral; Accept the return of collateral or make repossessions; or Use, commingle, or dispose of proceeds; or The secured party fails to require the debtor to account for proceeds or replace collateral. Requirements of possession not relaxed. This Code section does not relax the requirements of possession if attachment, perfection, or enforcement of a security interest depends upon possession of the collateral by the secured party. (Code 1981, § 11-9-205 , enacted by Ga. L. 2001, p. 362, § 1.) Law reviews. - For article discussing the classification of a continuing security interest in changing collateral as an unenforceable preference under Section 60a of the Bankruptcy Act, see 1 Ga. L. Rev. 257 (1967). For article, "The Good Faith Purchase Idea and the Uniform Commercial Code," see 15 Ga. L. Rev. 605 (1981). For note examining the conflict between the floating lien in after-acquired property under the Uniform Commercial Code and the voidable preferences provisions of the Bankruptcy Act, see 9 Ga. L. Rev. 685 (1975).