SECURED CREDITORS' NON-STATUTORY REMEDIES: UNFINISHED BUSINESS

Abstract

When personal property collateral taken under a security agreement has been damaged, destroyed or otherwise cannot be seized, the secured party must look to remedies outside the Personal Property Security Act. In almost all cases, this will involve a traditional “property tort” action. In this article, the author examines the actions of trespass, detinue, conversion and damage to a reversionary interest and concludes that none of them provides an appropriate method of addressing damage to or loss of a secured creditor’s in rem interest in the collateral. In the balance of the article, the author proposes a new statutory remedy that interfaces with the Personal Property Security Act and reflects the limited proprietary nature of a security interest.