HRS §490:9-627

How to tell if a sale of collateral was fair

Read the official text at capitol.hawaii.gov ↗

This section explains how a court decides if a secured party's sale or collection of collateral was commercially reasonable. It says that getting a higher price at a different time or way does not by itself prove the sale was unfair. A sale is fair if done in a usual market, at the current price, or in line with common dealer practices. Approval by a court or creditors' group can also show fairness, but lack of approval does not mean it was unfair.

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The statute, as written — Determination of whether conduct was commercially reasonable

A copy, taken August 20, 2026. The version published by the Legislature is the one that governs, and it may have changed since. Check it before relying on anything here.

(a) The fact that a greater amount could have been obtained by a collection, enforcement, disposition, or acceptance at a different time or in a different method from that selected by the secured party is not of itself sufficient to preclude the secured party from establishing that the collection, enforcement, disposition, or acceptance was made in a commercially reasonable manner. (b) A disposition of collateral is made in a commercially reasonable manner if the disposition is made: (1) In the usual manner on any recognized market; (2) At the price current in any recognized market at the time of the disposition; or (3) Otherwise in conformity with reasonable commercial practices among dealers in the type of property that was the subject of the disposition. (c) A collection, enforcement, disposition, or acceptance is commercially reasonable if it has been approved: (1) In a judicial proceeding; (2) By a bona fide creditors' committee; (3) By a representative of creditors; or (4) By an assignee for the benefit of creditors. (d) Approval under subsection (c) need not be obtained, and lack of approval does not mean that the collection, enforcement, disposition, or acceptance is not commercially reasonable.

Read the official text at capitol.hawaii.gov ↗as published Jan 6, 2026our copy taken Aug 20, 2026

LawTrove is not legal advice. The summary above is a computer-generated restatement — the authoritative text is the official version linked above.