New York Laws
Sub Part 1 - Effectiveness and Attachment
9-205 - Use or Disposition of Collateral Permissible.

(a) When security interest not invalid or fraudulent. A security
interest is not invalid or fraudulent against creditors solely because:
(1) the debtor has the right or ability to:
(A) use, commingle, or dispose of all or part of the
collateral, including returned or repossessed goods;
(B) collect, compromise, enforce, or otherwise deal with
collateral;
(C) accept the return of collateral or make repossessions; or
(D) use, commingle, or dispose of proceeds; or
(2) the secured party fails to require the debtor to account for
proceeds or replace collateral.
(b) Requirements of possession not relaxed. This section does not
relax the requirements of possession if attachment, perfection, or
enforcement of a security interest depends upon possession of the
collateral by the secured party.

Structure New York Laws