Term
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Definition
Article 9 = personal property
common law = real property |
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Term
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Definition
Article 9
-creditor acquires security interest and becomes secured party
three attachment events
-value
-debtor has rights in collateral
-secured party satisfies Article 9 SOF |
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Term
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Definition
essential for after-acquired inventory
can provide for SI in after-acquired consumer goods but only if those goods are acquired by consumer within 10 days of when the secured party gave value |
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Term
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Definition
| eliminates need for multiple security agreements |
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Term
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Definition
| security interest automatically attaches to identifiable proceeds and proceeds of proceeds |
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Term
| Perfection by filing financing statement |
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Definition
can perfect security interest by filing financing statement in all types of collateral by filing a financing statement, except for deposit account, money, or letter-of-credit rights
-secured party cannot perfect SI in deposit account as initial collateral by filing a financing statement; secured party must obtain control of account |
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Term
| Where to file financing statement |
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Definition
Article 9 provides for central filing
state where debtor is located, which is individual's principal residence, registered organization's state it is registered in and unregistered organization's state where it does busienss |
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| What to include in financing statemetn |
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Definition
| debtor's name, secured party's name, and description of collateral |
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Term
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Definition
-financing statements have a life of 5 years
-must file a continuation within six months of its expiration and it will extend another five years
-if D changes location to new state, secured party has 4 months to re-file in new state |
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Term
| Lien notation on certificate of title |
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Definition
automobiles are subject to certificate of title statutes
in general, if goods are subject to certificate of title, the only way to perfect a SI in such goods is to have lien noted on certificate of title |
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Definition
| can't do so if it is an account, commercial tort claim, general intangible, deposit account |
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Term
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Definition
can perfect SI in deposit account by taking control (has ability to get at D's account without D's cooperation)
control is gained by:
-having bank agree in an authenticated record to follow secured party's instrucitons or
-changing name on account from D's to secured party's |
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Term
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Definition
indefinite period of perfection
-PMSI (as a seller or as a lender): automatically perfected upon attachment
temporary perfection
-new value: SI in certified securities, negotiable documents, or instruments is automatically perfected for 20 days from attachment
-delivery of collateral to D: if collateral delivered to D for purpose of selling or exchanging it, SI in collateral remains temporarily perfected for 20 days
-movement of D to another state: 4 month grade period for perfected SI
-transfer of collateral to D in another state: one year grace period
-transfer of collateral subject to perfected possessory SI: no effect on perfection when IS is perfected under new state's laws
-effect of a lapse of temporary perfection: generally ceases to be perfected upon expiration of temporary perfection period
proceeds
-temporary perfection: if SI in original collateral perfected, SI in proceeds perfected for 20 days from attachment
-indefinite perfection: cash: if SI in original collateral perfected, identifiable cash proceeds indefinitely protected
-indefinite perfection: same office: if filed financing statement covers original collateral and proceeds are collateral in which SI may be perfected by filing in office in which financing statement has been filed (doesn't apply to proceeds acquired with cash proceeds) |
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Term
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Definition
obtains full title to collateral as result of purchase from debtor
general rule
-buyer's rights v unperfected SI: buyer takes collateral free of SI if buyer: gives value and receives delivery without knowledge of SI
-buyer's rights v perfected SI: generally takes collateral subject to SI
buyer in ordinary course of business: buys goods by giving new value in ordinary course of business from merchant in business of selling goods of that kind in good faith and without actual knowledge sale violates another's rights in goods
-buyer takes free of any SI in goods given by buyer's seller
consumer buyer: buys consumer goods for value; for own personal, family, household use; from a consumer seller; and without knowledge or record notice of SI
-consumer buyer takes free of any SI in consumer goods unless secured party has filed financing statement covering goods |
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Term
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Definition
-SI in fixtures v. RP interests: SI in fixtures has priority over interest in RP with which fixtures are associated if SI in fixtures perfected by fixture filing before RP interest recorded
-perfected SI in fixtures v. subsequent judicial lien: perfected SI in fixtures has priority
-PMSI in fixtures v. prior RP interest: PMSI in fixtures has priority if perfected by fixture filing before goods become fixtures or within 20 days thereafter
-SI in fixtures v. prior construction mortgage: prior construction mortgage has priority if recorded before goods become fixtures |
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Term
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Definition
ignore default
SI in fixture: secured party may remove fixture from RP if SI has priority; liable for repair costs
SI in accession: secured party may remove accession from other property if accession SI has priority
secured party and account debtors: upon default, secured party may notify account debtor to pay secured party |
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