Document ID: chunk:federal_register_of_legislation:C2024C00719:section:140:p2
Version: federal_register_of_legislation:C2024C00719
Segment Type: section
Provision Reference: s 140 (pt 2/2)
Character Range: 252682–253733

applies in the order of their priority (whether under this Act or otherwise).
 (4) This section applies in relation to a security interest in collateral even if a person takes the collateral free of the security interest under section 133.
 (5) An amount paid, or personal property or proceeds applied, in accordance with subsection (2) discharges an obligation secured by an interest in the collateral to the extent of the amount paid or the value of the proceeds or property applied.
 (6) To avoid doubt, any amount paid by the higher priority party to an enforcing party in accordance with section 127 is, for the purposes of this section, an expense incurred by the higher priority party in relation to the enforcement of the security interest in the collateral.
 (7) A secured party is not liable to an action, suit or proceeding in relation to an application of proceeds in accordance with this section if:
 (a) the secured party applied the proceeds honestly; and
 (b) the secured party applied the proceeds in a commercially reasonable manner.