Secured Transactions
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1) Is there a SI? 1-207(37) 2) Does Art 9 care? (9-109 = we care, 9-109d = exceptions & we don't care) 3) Is the SI enforceable? a) SA: 9-203 1) authenticated by the debtor, 9-102 any mark symbol executed w/ present intent to adopt writing as your own 2) describes the collateral (can't be super generic), & (i) rzbly identifies what it describes (ii) can use code category = safe harbor enough of a description 9-108 A. goods inventory: held for sale or lease equipment: catch all for goods farm products: farmer, bsns of farming consumer goods: personal HH or family purposes B. quasi intangibles: chattel paper instruments docs C. intangibles: accounts, health care receivables etc. (iii) type of collateral ("all bsns machines) (iv) computational formula (v) quantity 3) words of grant (not expressly in 9-203, but need) b) will SA attach? 4) value 5) debtor has rights in collateral remember => (FA, AAP) 4) attached SI => PERFECTION a) general rule: 1) perfect by filing 9-310 a) FS 9-502 minimums 1. name debtor 2. name SP 3. id collateral (can be super generic) req's for clerk to accept [506, 507] 1. not seriously misleading = still effective 2. seriously misleading (no debtor's name, etc) 9-507 name change: if new name makes name seriously misleading => must refile under correct name in 4 mos. of name change 9-xx: change of location (retroactive lapse) 9-506b requirements: [address of SP, name of debtor, readable, which is first/last name, address of debtor, if debtor is org (jx, origin, type of org, id #)] ???not sure about this section??? a) w/o these, clerk should reject => fix b) if clerk accepts anyway =>
Secured Transactions
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ok as long as 502 reqs are present, but not effective against PFV c) clerk accepts w/ incorrect info: 9-338: subsequent purchaser of collateral who relies takes free of SI (or takes priority over) d) clerk should have accepted but didn't? where to file: SOS [501] (unless extracted minerals, timber, fixtures) Choice of law: JX: where debtor is located [501] bsns: place of bsns; chief exec office, 2 at most person: place of residence registered org: jx where registered exceptions 2) possession [313] a) agent; if not in possession of SP, but in Agent of SP => debtor cant have any control!!! (authenticated writing issues, etc) 3) control [314] a) deposit accts b) LOCs c) investment property 4) PMSI in consumer goods [309] 5) temporary [312] 6) COT (don't file FS, but comply w/ applicable COT act) 5) Priority: a) perfected interests: general rule 9-322 first in time b) exceptions: 1) PMSI [324] a) good = 20 days from day debtor gets possession b) inventory: must be perfected before debtor gets possession notice 1. describe collateral 2. indicated you're taking pmsi in collateral 3. before 5 years before 2) BIOC [320] 3) Garage Sale [320] 4) Possessory Statutory Liens 5) Chattel Paper [330] 6) Negotiable Instruments [331] c) 9-317: unperfected SI's d) Fixtures: their own priority rules 1) priority rules a) 2) perfection: fixture filing a) file in RE records b) describe land c) say I am taking SI in fixture d) if debtor not owner => must say owner of land's name, too 6) Remedies a) default: def'd by SA (not paying, no maintenance, insurance)
Secured Transactions
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1) non-payment 2) insecurity b) obligation is accellerated ($100 * 120 months; you are in month 10, but you have to pay all 120,000) c) remedies (can do both remedies!!! to get what debt is worth; you can get deficiency jj) 1) outside art 9 => court => jj => execute 2) repossess the collateral condition: can't breach the peace! take collateral, disable the collateral (change a password), foreclose & sell a) strictly foreclosure: SP keep the collateral in lieu of what is owed b) sell the collateral (may have deficiency after sale, so then go to ct. and get jj) i. public sale - auction; a sale that is open to the public w/ competitive bidding 1. notice: time and place 2. exceptions: (certain types of collateral don't require notice) perishable goods sold in recognized, organized market (stock market) if value of collateral is rapidly deteriorating ii. private sale - sell to highest bidder; run ad in newspaper 1. notice: date after which you will sell the collateral 2. exception: see exceptions for types of collateral above d) debtor wants to see if cr. has violated art 9 1. creditor (after default) must act in a commercially reasonable way (things that don't comply with the terms or spirit of art. 9 [has to act comm'ly rzbl in...] a. manner b. method c. place d. time e. terms 2. burdens: SP (creditor) when it sues for a deficiency doesn't have to est. that it acted in a commercially reasonable matter unless the debtor puts that to issue (which any debtor should do!) (if that's done, creditor must est. it was commercially rzbl) 3. failure to est. compliance with art 9 => a) non consumer situation: presumption created that sale $ is equal to the entire obligation of the debtor; burden shifts to SP to show even if he had acted in commercially rzbl manner, he wouldn't have gotten the all debtor owed. b) consumer context: code doesn't say