questions & answers

Question: I purchased a farm using two different private loans(no banks). One loan was on a promissory note. Animals were used as the collateral on the note. Having defaulted on the note, I have turned over all the animals to the party owed. Is there an Arizona law or case that establishes the turnover of collateral as discharge of the note? Can you recommend a method for me to find this specific information. Thanks

Answer:

Title 47 of the Arizona Revised Statutes (A.R.S.) contains the Uniform Commercial Code. The uniform commercial code contains laws pertaining to loans, collateral and loan deficiencies. Much depends on the type of agreement that you had with the private lenders. You may want to consult with an attorney and show the attorney your loan documents so that the attorney can explain how the law applies in your specific situation.

If you are interested in doing your own research on the topic, you may want to go to your local library or local law library where you may be able to search through cases on the topic.