Pennsylvania § 9313 - When possession by or delivery to secured party perfects security interest without filing.

§ 9313. When possession by or delivery to secured party perfects security interest without filing.

(a) Perfection by possession or delivery.--Except as otherwise provided in subsection (b), a secured party may perfect a security interest in goods, instruments, negotiable tangible documents or money by taking possession of the collateral. A secured party may perfect a security interest in certificated securities by taking delivery under section 8301 (relating to delivery).

(b) Goods covered by certificate of title.--With respect to goods covered by a certificate of title issued by the Commonwealth, a secured party may perfect a security interest in the goods by taking possession of the goods only in the circumstances described in section 9316(d) (relating to effect of change in governing law).

(c) Collateral in possession of person other than debtor.--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:

(1) the person in possession signs a record acknowledging that the person holds possession of the collateral for the secured party's benefit; or

(2) the person takes possession of the collateral after having signed a record acknowledging that the person will hold possession of the collateral for the secured party's benefit.

(d) Time of perfection by possession; continuation of perfection.--If perfection of a security interest depends upon possession of the collateral by a secured party, perfection occurs not earlier than the time the secured party takes possession and continues only while the secured party retains possession.

(e) Time of perfection by delivery; continuation of perfection.--A security interest in a certificated security in registered form is perfected by delivery when delivery of the certificated security occurs under section 8301 and remains perfected by delivery until the debtor obtains possession of the security certificate.

(f) Acknowledgment not required.--A person in possession of collateral is not required to acknowledge that the person holds possession for a secured party's benefit.

(g) Effectiveness of acknowledgment; no duties or confirmation.--If a person acknowledges that the person holds possession for the secured party's benefit:

(1) the acknowledgment is effective under subsection (c) or section 8301(a) (relating to delivery of certificated security) even if the acknowledgment violates the rights of a debtor; and

(2) unless the person otherwise agrees or law other than this division otherwise provides, the person does not owe any duty to the secured party and is not required to confirm the acknowledgment to another person.

(h) Secured party's delivery to person other than debtor.--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:

(1) to hold possession of the collateral for the secured party's benefit; or

(2) to redeliver the collateral to the secured party.

(i) Effect of delivery under subsection (h); no duties or confirmation.--A secured party does not relinquish possession even if a delivery under subsection (h) violates the rights of a debtor. A person to which collateral is delivered under subsection (h) 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 division otherwise provides.

(Apr. 16, 2008, P.L.57, No.13, eff. 60 days; June 27, 2013, P.L.154, No.30, eff. July 1, 2013; July 1, 2024, P.L.450, No.41, eff. 60 days)

2024 Amendment. Act 41 amended subsecs. (a), (c) and (d). See section 1 of Act 41 in the appendix to this title for special provisions relating to findings and declarations.

2013 Amendment. Act 30 amended subsec. (b).

Cross References. Section 9313 is referred to in sections 9203, 9310, 9311, 9312, 9314.1, 9316, 9320, 9328 of this title.