ANALYSIS: (1) UCC Art 9 apply? (2) SI attached? (3) SI perfected?

(4) POSSESSION: tangible collateral (goods, docs, money); can give back
multiple claimants priority? (5) means of SI enforcement? possession to sell, exchange, or enforce debtors rts in it & remain
DOES UCC ARTICLE 9 APPLY? perfected for 20 days (either file FS or repossess by then).
SCOPE: (1) consensual SI, (2) involving personal prop or fixtures CONTROL: intangible collateral (deposit acct, letter of credit rt, e-docs).
(not real prop), (3) regardless of form (substance of transaction). Deposit Accts: (1) secured pty is the bank, (2) control agmt btwn
Agricultural Liens: SI in farm products for goods, services, or real secured pty & bank & debtor, or (3) secured pty becomes bank’s
prop rent provided for farming operations. customer w/ respect to acct. **Control is exclusive method to perfect!
Sale of Payment Rts: chattel paper, promissory notes, accounts, & ALTERNATE SYSTEM: statute reqs alt method; SI must be noted on
payment intangibles. certificate of title to perfect on vehicles unless held as inventory.
Lease: Art 9 if economic reality is secured transaction; bright line test AUTOMATIC PERFECTION: PMSI in consumer goods (except vehicles);
- lessee is obligated to pay full amt under lease regardless of early PMSI exists when secured pty (1) sells debtor the collateral or (2)
termination & any one of (1) orig term = econ life of goods, (2) req’d to loans debtor $ to buy the specific collateral & takes SI in item.
renew lease for econ life of goods, (3) option to renew lease for econ life FILING
of goods for no cons’n, (4) option to buy goods for no cons’n; if bright WHAT: financing stmt w/ (1) debtor’s name, (2) secured pty’s
line test not met, ct looks at facts of case to determine if secured name, (3) description of collateral, (4) maturity date or lack
transaction exists (ask if lessor gets something of value back at end). thereof if collateral is consumer goods & orig obligation is ≤
Consignments: consignor gives possession to consignee to sell goods $5000, & (5) real prop info if collateral is growing crops, (6)
for consignor; treat consignor under PMSI in inventory rules; apply authorization of debtor (need not sign FS, can be signed SI).
when (1) goods delivered to merchant in goods of the kind, (2) value Debtor Name: individual – name on ID; registered org – name in
$1000+ per delivery, (3) not consumer goods immediately before public records; trade name – insufficient; name change – 4 mo to
delivery, & (4) merchant’s creditors wouldn’t gen know merchant amend stmt or prop acquired after 4 mo window not covered.
engaged in selling goods of others (not consignment store). Collateral: generic description ok (3rd pty notice to inquire further).
CLASSIFY COLLATERAL: based on debtor’s principal use at time of Addresses: filing office can reject if not incl, but if accepted perfected.
SI; affects attachment, perfection, & priority. Errors: no effect unless seriously misleading; debtor name errors
Consumer Goods: personal/family uses. almost always srsly misleading unless search would show FS.
Farm Product Goods: used/produced in farming (not equipment). WHERE: collateral related to real prop (incl uncut timber, mineral,
Inventory Goods: held for sale/lease/service use (not farm products). crops, & fixtures) – real prop records where prop located; other
Equipment Goods: other movable goods (eg, machinery). collateral – state where debtor located (if GA, office of clerk of
Fixtures: attached to real prop. superior ct of any cty; if other state, gen filed w/ secretary of state).
Rts to Payment: commercial paper, chattel paper, business accts. Individual: state of principal residence.
Deposit Accts: bank accounts. Partnership: state of chief executive office/pl of business.
ATTACHMENT: SI EFFECTIVE AGAINST DEBTOR Corporation: state of incorporation.
1. VALUE: consideration given any time (already given; binding Debtor Moves: 4 mo window to re-file in new state.
promise of future value) Collateral Moves: same debtor – no effect; new debtor – 1 yr to file.
2. RIGHTS: debtor owns rts in collateral; ok if voidable (no thieves). WHEN: upon delivery to filing office & payment of filing fee;
3. SECURITY AGMT: either (1) a record of agmt signed by debtor w/ effective 5 yrs or 20th day after specified earlier maturity date.
description reas identifying collateral (generic not ok) or (2) Continuation Stmt: extends add’l 5 yrs from date orig stmt would
possession/control of collateral pursuant to oral/unsigned agmt lapse; debtor sign not req’d.
(secured pty has duty of reas care of possessed collateral & must return it REFUSED: if justified, no perfection; if unjustified perfected
upon satisfaction, may charge debtor reas exp of maintaining it). against other creditors but not BFP that buys collateral.
AFTER-ACQUIRED: can be implied if suff described (eg, “inventory”). INCORRECT INDEX: no effect on perfection (risk on searcher).
ACCESSION: identity retained after united w/ other goods, no AMENDMENT: change in collateral effective from filing date; no
effect on SI; commingled – identity lost, SI in resulting product. extension of orig FS lapse date.
PROCEEDS: attachment automatic to results of collateral disposal. TERMINATION STMT: if non-consumer goods, secured pty req’d to
PERFECTION: SI EFFECTIVE AGAINST WORLD file or send debtor stmt w/in (1) 90 days of satisfaction or (2) 20
PROCEEDS: if collateral is disposed of after SI is perfected, days of authenticated demand from debtor, whichever earlier.
perfection continues in the results of disposal for 20 days (secured
pty must take further perfection steps to extend – eg, amend FS).
Cash: perfection indefinite as long as identifiable (eg, sep acct).
Same Office: orig FS maintains perfection if (1) FS covers orig
collateral, (2) new collateral could be perfected by filing in same
office, & (3) new collateral not acquired w/ cash.
 MULTIPLE CLAIMANTS: CLAIM PRIORITY DEFAULT: ENFORCING THE SI
CONTINUITY: as long as SI is continuously perfected, priority will GENERALLY: default defined by pty’s agmt; cumulative remedies.
relate to orig perfection date; any lapse will affect priority. REPOSSESSION: by judicial process (eg, replevin) or self-help w/out
GENERAL CREDITOR: jgmt on debtor but not collateral – SI wins. br of peace; equipment can be rendered unusable & sold on site;
JUDICIAL LIEN: perfected SI beats JL unless JL properly recorded secured pty can sell repossessed collateral or accept it in full or
first; JL beats unperfected SI unless the only reason SI wasn’t partial satisfaction of debt.
perfected is value not yet given (eg, SI already filed). Br of Peace: bring officer w/out judicial auth, break in home/garage,
PMSI: perfected before or w/in 20 days after debtor receives debtor’s unequivocal oral protest; no br - trespass, no confrontation,
possession of collateral beats JL arising btwn attachment & filing. even if at night; secured pty cannot avoid liability for br of peace by
STATUTORY LIEN: possessory lien beats any SI if it secures paymnt hiring 3rd pty contractor to effect self-help repossession.
in ord course of business (eg, mechanic’s lien holding car for repairs). Fixtures & Accessions: removal ok if secured pty has priority over
Farm Machinery: mechanic’s lien beats any SI unless FS filed other claimants, but liable to repair dmg caused by removal.
describes particular piece of machinery. STRICT FORECLOSURE: collateral accepted; written proposal to
FIXTURES: SI perfected by filing beats subsequent real estate int; debtor & notice to all other claimants (object w/in 20 days).
prior real estate int properly recorded beats later SI except PMSI Consumer Goods: full satisfaction only; if debtor has paid 60%+
filed before goods become fixtures or w/in 20 days after. goods must be sold unless debtor waives in authenticated record.
ACCESSION: SI in whole perfected by cert of title beats SI in acc’n. Full Satisfaction: debtor consents in authenticated record or fails to
SECURED PARTIES object w/in 20 days after proposal sent.
PERFECTED VS PERFECTED: first to file or perfect wins. Partial Satisfaction: debtor consents in authenticated record.
PERFECTED VS UNPERFECTED: perfected SI wins. DISPOSITION: pty can sell, lease, or license collateral & apply
UNPERFECTED VS UNPERFECTED: first to attach or perfect wins. proceeds to debt if all aspects commercially reas (method, manner,
PMSI INVENTORY: beats all other SIs if (1) perfected before time, place, terms – price alone not determinative, look at mkt stnd); sale
delivery, & (2) authenticated notification sent to other secured can be public or private; secured pty can buy collateral at public
ptys (one notif’n effective 5 yrs); priority extends to cash proceeds. sale but not private sale unless price fixed by mkt stnd.
PMSI OTHER GOODS: beats all other SIs if perfected w/in 20 days Notice Who: authenticated notice req’d to debtor, secondary
of delivery; if not treat as reg SI; priority extends to all proceeds. obligors, other secured ptys, & any other claimant unless collateral
PMSI VS PMSI: seller beats lender; otherwise first to file/perfect. perishable, sold on recognized mkt, or notice waived
BUYERS & TRANSFEREES Notice When: must be given in reas time to act; safe harbor - 10 days
TRANSFEREES: SI continues in transferred collateral unless before sale in non-commercial transaction.
secured pty authorizes transfer free of it; transferee of money or Notice What: must incl secured pty & debtor names, description of
funds from deposit acct takes free of any SI unless acting in collateral, details of sale, & stmt debtor entitled to accounting for
collusion w/ debtor to violate secured pty’s rts. unpaid debt; consumer goods notice must also incl description of
BUYERS GENERALLY: a buyer takes free of unperfected SI if he liability for deficiency & telephone # for add’l info on redemption rts.
gives value & receives delivery without knowledge of SI; a buyer Proceeds: applied to reas exp of enforcement, pay debt on foreclosing
takes subject to perfected SI. pty, pay subordinate debts if formally demanded, surplus to debtor;
BUYER IN ORD COURSE OF BUS: (1) buys goods (but not farm products) senior SIs survive sale (buyer takes subject to); debtor liable for any
by giving new value, (2) in ord course, (3) from seller in business deficiency unless sold cheap to inside buyer (reas mkt amt inferred).
of selling goods of the kind, (4) in good faith, & (5) w/out actual REDEMPTION: debtor, secondary obligor, or other secured pty has
knowledge of secured pty’s rts; buyer takes free of any SI. rt to redeem by paying entire obligation (full amt if acceleration cl)
GARAGE SALE RULE: (1) buys consumer goods for value, (2) for own & exp (incl atty’s fees) before collateral sold or accepted in
pers’l/fam use, (3) from consumer seller, & (4) w/out knowledge satisfaction; rt cannot be waived before default.
of SI; buyer takes free of any SI unless FS filed covers the goods. SECURED PTY VIOLATIONS: (1) injunctive relief for ongoing
BUYER OF CHATTEL PAPER: (1) gives new value & has possession or improper enforcement activity, (2) actual dmgs, (3) consumer
control, (2) in good faith & ord course of business, & (3) chattel goods min statutory dmgs of the credit service charge + 10% of
paper doesn’t indicate assignment to ID’d assignee if SI claimed principal amt/time-price differential + 10% of cash price, even if
as proceeds of inventory or purchase made w/out knowledge of actual dmgs less, or (4) conversion action.
secured pty’s rts if any other SI; buyer takes priority. Not Commercially Reas Sale: in commercial transactions,
BUYER OF NEGOTIABLE INSTRUMENT: buyer takes free of any SI. rebuttable presumption secured pty not entitled to collect deficiency;
FUTURE ADVANCES: buyer took collateral subject to SI & secured rebutted by showing compliance w/ commercially reas stnd would
pty made future advances to seller after sale; buyer takes free of have resulted in the deficiency anyway; in consumer transactions, ct
that advance if secured pty had knowledge of sale or advance was may absolutely bar deficiency for failure to comply.
made 45+ days after sale.