§ 39-1-60 Commingling.
The validity of the interest of an assignee or secured party in intangible transition property, and in all revenues or other proceeds arising in respect of such property whenever realized, as herein provided, and the relative priority of the security interest of a secured party therein, when perfected in accordance with the rules of the commission established pursuant to § 39-1-56, shall not be defeated or adversely affected by the commingling of any such revenues or other proceeds with other funds, including those of the electric distribution company or assignee, a successor to either such party, another party providing electric service as described in § 39-1-45(4) or a party performing collection functions on behalf of any of the foregoing. All of the foregoing parties shall for purposes of this section be referred to as a "collection party". Nor shall such interest be defeated by the existence of any security interest in a deposit account of any such collection party perfected under Article 9, commencing with § 9-101, of the Uniform Commercial Code (chapter 9 of title 6A), in which such revenues or other proceeds may have been deposited; and, to the extent that moneys of an assignee of intangible transition property are at any time held in a deposit or other account of a collection party, such moneys shall be considered to be held in trust for the benefit of such assignee. For this purpose:
(1) An assignee of intangible transition property arising under a securitization order shall have a perfected interest, and the holders of a perfected security interest in intangible transition property of the electric distribution company or assignee arising under such order shall have a perfected security interest, in all cash and deposit accounts of any collection party in which amounts collected, recovered or received in respect of intangible transition charges pursuant to such order have been deposited and commingled with other funds, provided, that any such perfected security interest in deposit accounts of the electric distribution company or assignee or a successor thereof, if such party is the debtor of the party holding the perfected security interest, shall be subject to any applicable right of set-off and, in the event of insolvency of the electric distribution company or assignee or a successor thereof, the perfected security interest in intangible transition property of such insolvent party and any revenues or other proceeds arising in respect of such property shall be limited to an amount not greater than the amounts collected or recovered by such party in respect of intangible transition charges, whether or not actually deposited in the deposit accounts of such party, within the twelve (12) months preceding the commencement of insolvency proceedings, less the sum of such amounts paid to or for the account of the holders of such security interest in intangible transition property, or transferred to a segregated account held solely for their benefit, during such twelve (12) month period; and
(2) In the event that proceeds of intangible transition property which have been recovered, collected, or otherwise received by a collection party shall have been transferred by such party from a commingled account that includes other funds to a segregated account identified as held solely for the benefit of the holders of transition bonds, which bonds are secured by a security interest, perfected in accordance with the rules of the commission established pursuant to § 39-1-56, in the intangible transition property and all revenues and other proceeds arising in respect of such property, the security interest of the holders of the transition bonds shall apply to any such segregated account, and shall have priority over any other interest or security interest therein, and over the lien of any judgment lien creditor or other lien creditor to which the security interest of the transition bonds is senior, in accordance with § 39-1-55(vi) of this chapter.
(P.L. 1997, ch. 142, § 1.)