“Strict foreclosure” under UCC Article 9 is a remedy that allows a secured party to accept collateral in full or partial satisfaction of a debtor’s secured obligation. The collateral can be acquired free of competing claims and without a sale or any judicial process. In exchange, all or a portion of the secured debt will be cancelled. Of course, all of this is subject to the specific requirements of UCC §$9-620 and 9-621, among them being a willing debtor and creditor. In the rancorous world of restructuring that is more often than not a major hurdle.

Just recently the New York Court of Appeals issued a ruling in a case involving strict foreclosure. In CNH Diversified Opportunities Master Account, L.P. v. Cleveland Unlimited, 2020 WL 6163305 (N.Y. Ct. App. Oct. 22, 2020), the Court of Appeals sustained a challenge by a group of minority noteholders claiming that they were entitled to consent to the foreclosure process.