Jerry Payne owed the First State Bank of Pflugerville $342,000. The loan was secured by a 9.25-carat diamond ring. The bank claimed a default on the loan and, without notifying Payne, sold the ring. But the proceeds did not pay off the full debt, and the bank sued Payne for the deficiency. Is Payne liable for the deficiency? 

Strategy: A secured party may dispose of the collateral in any commercially reasonable way. What must the secured party do to ensure commercial reasonableness?

Answer rating: 100% (QA)

In the given scenario whether Jerry Payne is liable for the deficiency depends on the specifics of t... View the full answer