1. When so agreed and in any event on default the secured party is entitled to notify an account debtor or the obligor on an instrument to make payment to the secured party whether or not the assignor was theretofore making collections on the collateral, and also to take control of any proceeds to which the secured party is entitled under section 554.9306.
2. A secured party who by agreement is entitled to charge back uncollected collateral or otherwise to full or limited recourse against the debtor and who undertakes to collect from the account debtors or obligors must proceed in a commercially reasonable manner and may deduct the secured party's reasonable expenses of realization from the collections. If the security agreement secures an indebtedness, the secured party must account to the debtor for any surplus, and unless otherwise agreed, the debtor is liable for any deficiency. But, if the underlying transaction was a sale of accounts or chattel paper, the debtor is entitled to any surplus or is liable for any deficiency only if the security agreement so provides.
[C51, § 2072; R60, § 3650; C73, § 3308; C97, § 4274; C24, 27, 31, 35, 39, § 12353; C46, 50, 54, 58, 62, § 652.2; C66, 71, 73, 75, 77, 79, 81, § 554.9502]
Referred to in § 15E.91, 16.26, 16A.9, 537.5103, 554.9112, 554.9501
For future amendments to this section effective July 1, 2001, see 2000 Acts, ch 1149, §73, 185, 187
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