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LENDING: Revised Article 9

Part 1 - General Provisions
Part 2 - Effectiveness of Security Agreement; Attachment of Security Interest; Rights of Parties to Security Agreement
Part 3 - Perfection and Priority
Part 4 - Rights of Third Parties
Part 5 - Filing
Part 6 - Default
Part 7 - Transition


Part 1 - General Provisions

Subpart 1 - Short Title, Definitions, and General Concepts

Section 9-101 - Short Title
Section 9-102 - Definitions and Index of Definitions
Article 9 definitions
Section 9-103 - Purchase-Money Security Interest; Application of Payments; Burden of Establishing
Section 9-104 - Control of Deposit Account
Section 9-105 - Control of Electronic Chattel Paper
Section 9-106 - Control of Investment Property
Section 9-107 - Control of Letter-of-Credit Right
Section 9-108 - Sufficiency of Description

Subpart 2 - Applicability of Article

Section 9-109 - Scope
Section 9-110 - Security Interests Arising Under Article 2 or 2A

Part 2 - Effectiveness of Security Agreement; Attachment of Security Interest; Rights of Parties to Security Agreement

Subpart 1 - Effectiveness and Attachment


Section 9-201 - General Effectiveness of Security Agreement
Section 9-202 - Ttitle to Collateral Immaterial
Section 9-203 - Attachment and Enforceability of Security Interest; Proceeds; Supporting Obligations; Formal Requisites
Section 9-204 - After-Acquired Property; Future Advances
Section 9-205 - Use or Disposition of Collateral Permissible
Section 9-206 - Security Interest Arising in Purchase or Delivery of Financial Asset

Subpart 2 - Rights and Duties

Section 9-207 - Rights and Duties of Secured Party Having Possession or Control of Collateral
Section 9-208 - Additional Duties of Secured Party Having Control of Collateral
Section 9-209 - Duties of Secured Party if Account Debtor has been Notified of Assignment
Section 9-210 - Request for Accounting; Request Regarding List of Collateral or Statement of Account

Part 3 - Perfection and Priority

Subpart 1 - Law Governing Perfection and Priority


Section 9-301 - Law Governing Perfection and Priority of Security Interests
Section 9-302 - Law Governing Perfection and Priority of Agricultural Liens
Section 9-303 - Law Governing Perfection and Priority of Security Interest in Good Covered by a Certificate of Title
Section 9-304 - Law Governing Perfection and Priority of Security Interests in Deposit Accounts
Section 9-305 - Law Governing Perfection and Priority of Security Interests in Investment Property
Section 9-306 - Law Governing Perfection and Priority of Security Interests in Letter-of-Credit Rights
Section 9-307 - Location of Debtor

Subpart 2 - Perfection

Section 9-308 - When Security Interest or Agricultual Lien is Perfected; Continuity of Perfection
Section 9-309 - Security Interest Perfected Upon Attachment
Section 9-310 - When Filing Required to Perfect Security Interest or Agricultural Lien; Security Interests and Agricultual Liens to Which Filing Provisions Do Not Apply
Section 9-311 - Perfection of Security Interests in Property Subject to Certain Statutes, Regulations, and Treaties
Section 9-312 - Perfection of Security Interests in Chattel Paper, Deposit Accounts, Documents, Good Covered by Documents, Instruments, Investment Property, Letter-of-Credit Rights, and Money; Perfection by Permissive Filing; Temporary Perfection without Filing or Transfer of Possession
Section 9-313 - When Possession by or Delivery to Secured Party Perfects Security Interest Without Filing
Section 9-314 - Perfection by Control
Section 9-315 - Secured Party's Rights on Disposition of Collateral and in Proceeds
Section 9-316 - Continued Perfection of Security Interest Following Change in Governing Law

Subpart 3 - Priority

Section 9-317 - Interests that Take Priority Over or Take Free of Security Interest or Agricultual Lien
Section 9-318 - Rights and Title of Seller of Account or Chattel Paper with Respec to Creditors and Purchasers
Section 9-319 - Rights and Title of Consignee with Respect to Creditors and Purchasers
Section 9-320 - Buyer of Goods

Section 9-321 - Licensee of General Intangible and Lessee of Goods in Ordinary Course of Business
Section 9-322 - Priorities Among Conflicting Security Interests in and Agricultural Liens on Same Collateral
Section 9-323 - Future Advances
Section 9-324 - Priority of Purchase-Money Security Interests
Section 9-325 - Priority of Security Interests in Transferred Collateral
Section 9-326 - Priority of Security Interests Created by New Debtor
Section 9-327 - Priority of Security Interests in Deposit Account
Section 9-328 - Priority of Security Interests in Investment Property
Section 9-329 - Priority of Security Interests in Letter-of-Credit Right

Section 9-330 - Priority of Purchasers of Chattel Paper or Instrument
Section 9-331 - Priority of Rights of Purchasers of Instruments, Documents, and Securities Under Other Articles; Priority of Interests in Financial Assets and Security Entitlements under Article 8
Section 9-332 - Transfer of Money: Transfer of Funds From Deposit Account
Section 9-333 - Priority of Certain Liens Arising by Operation of Law
Section 9-334 - Priority of Security Interests in Fixtures and Crops
Section 9-335 - Accessions
Section 9-336 - Commingled Goods
Section 9-337 - Priority of Security Interests in Goods Covered by Certificate of Title
Section 9-338 - Priority of Security Interests or Agricultural Lien Perfected by Filed Financing Statement Providing Certain Incorrect Information
Section 9-339 - Priority Subject to Subordination

Subpart 4 - Rights of Bank

Section 9-340 - Effectiveness of Right of Recoupment or Set-off Against Deposit Account
Section 9-341 - Bank's Rights and Duties with Respect to Deposit Account
Section 9-342 - Bank's Right to Refuse to Enter into or Disclosure existence of Control Agreement

Part 4 - Rights of Third Parties

Section 9-401 - Alienability of Debtor's Rights
Section 9-402 - Secured Party Not Obligated on Contract of Debtor or in Tort
Section 9-403 - Agreement not to Assert Defenses Against Assignee
Section 9-404 - Rights Acquired by Assignee; Claims and Defenses Against Assignee
Section 9-405 - Modification of Assigned Contract
Section 9-406 - Discharge of Account Debtor; Notification of Assignment; Identification and Proof of Assignment; Restrictions on Assignment of Accounts, Chattel Paper, Payment Intangibles, and Promissory Notes Ineffective
Section 9-407 - Restrictions on Creation or Enforcement of Security Interest in Leasehold Interest or in Lessor's Residual Interest
Section 9-408 - Restrictions on Assignment of Promissory Notes, Notes, Health-Care-Insurance Receivables, and Certain General Intangibles Ineffective
Section 9-409 - Restrictions on Assignment of Letter-of-Credit Rights Ineffective

Part 5 - Filing
Subpart 1 - Filing Office. Contents and Effectiveness of Financing Statement


Section 9-501 - Filing Office
Section 9-502 - Contents of Financing Statement; Record of Mortgage as Financing Statement; Time of Filing Financing Statement
Section 9-503 - Name of Debtor and Secured Party
Section 9-504 - Indication of Collateral
Section 9-505 - Filing and Compliance with other Statutes and Treaties for Consignments, Leases, other Bailments, and other Transactions
Section 9-506 - Effect of Errors or Omissions
Section 9-507 - Effect of Certain Events on Effectiveness of Financing Statement
Section 9-508 - Effectiveness of Financing Statement if New Debtor Becomes Bound by Security Agreement
Section 9-509 - Persons Entitled to File a Record
Section 9-510 - Effectiveness of Filed Record
Section 9-511 - Secured Party of Record
Section 9-512 - Amendment of Financing Statement
Section 9-513 - Termination Statement
Section 9-514 - Assignment of Powers of Secured Party of Record
Section 9-515 - Duration and Effectiveness of Financing Statement; Effect of Lapsed Financing Statement
Section 9-516 - What Constitutes Filing: Effectiveness of Filing
Section 9-517 - Effect of Indexing Errors
Section 9-518 - Claim Concerning Inaccurate or Wrongfully Filed Record

Subpart 2 - Duties and Operation of Filing Office

Section 9-519 - Numbering, Maintaining, and Indexing Records; Communicating Information Provided in Records
Section 9-520 - Acceptance and Refusal to Accept Record
Section 9-521 - Uniform Form of Written Financing Statement and Amendment
Section 9-522 - Maintenance and Destruction of Records
Section 9-523 - Information From Filing Office; Sale or License of Records
Section 9-524 - Delay by Filing Office
Section 9-525 - Fees
Section 9-526 - Filing Office Rules
Section 9-527 - Duty to Report

Part 6 - Default
Subpart 1 - Default and Enforcement of Security Interest


Section 9-601 - Rights After Default; Judicial Enforcement; Consignor or Buyer of Accounts, Chattel Paper, Payment Intangibles, or Promissory Notes
Section 9-602 - Waiver and Variance of Rights and Duties
Section 9-603 - Agreement on Standards Concerning Rights and Duties
Section 9-604 - Procedure if Security Agreement Covers Real Property or Fixtures
Section 9-605 - Unknown Debtor or Secondary Obligor
Section 9-606 - Time of Default for Agricultural Lien
Section 9-607 - Collection and Enforcement by Secured Party
Section 9-608 - Application of Proceeds of Collection or Enforcement; Liability for Deficiency and Right to Surplus
Section 9-609 - Secured Party's Right to Take Possession After Default
Section 9-610 - Disposition of Collateral After Default
Section 9-611 - Notification Before Disposition of Collateral
Section 9-612 - Timeliness of Notification Before Disposition of Collateral
Section 9-613 - Contents and Form of Notification Before Dispositioin of Collateral; General
Section 9-614 - Contents and Form of Notification Before Disposition of Collateral; Consumer-Goods Transaction
Section 9-615 - Application of Proceeds of Disposition; Liability for Deficiency and Right to Surplus
Section 9-616 - Explanation of Calculation of Surplus or Deficiency
Section 9-617 - Rights of Transferee of Collateral
Section 9-618 - Rights and Duties of Certain Secondary Obligors
Section 9-619 - Transfer of Record or Legal Title
Section 9-620 - Acceptance of Collateral in Full or Partial Satisfaction of Obligation; Compulsory Disposition of Collateral

Section 9-621 - Notification of Proposal to Accept Collateral
Section 9-622 - Effect of Acceptance of Collateral
Section 9-623 - Right to Redeem Collateral
Section 9-624 - Waiver
Section 9-625 - Remedies for Secured Party's Failure to Comply with Article

Subpart 2 - Noncompliance with Article

Section 9-626 - Action in Which Deficiency or Surplus is in Issue
Section 9-627 - Determination of Whether Conduct was Commercially Reasonable
Section 9-628 - Nonliability and Limitation on Liability of Secured Party; Liability of Secondary Obligor

Part 7 - Transition

Section 9-701 - Effective Date
Section 9-702 - Savings Clause
Section 9-703 - Security Interest Perfected Before Effective Date
Section 9-704 - Security Interest Unperfected Before Effective Date
Section 9-705 - Effectiveness of Action Taken Before Effective Date of Act
Section 9-706 - When Initial Financing Statement Suffices to Continue Effectiveness of Financing Statement
Section 9-707 - Persons Entitled to File Initial Financing Statement
Section 9-708 - Persons Entitled to File Initial Financing Statement or Continuation Statement
Section 9-709 - Priority

PART 1 - GENERAL PROVISIONS

Section 9-101

SHORT TITLE

This article may be cited as Uniform Commercial Code ? Secured Transactions.


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Section 9-102

DEFINITIONS AND INDEX OF DEFINITIONS

(a) Article 9 definitions. In this article:

(1) "Accession" means goods that are physically united with other goods in such a manner that the identity of the original goods is not lost.

(2) (A) "Account", except as used in "account for", means a right to payment of a monetary obligation, whether or not earned by performance:

(i) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of;

(ii) for services rendered or to be rendered;

(iii) for a policy of insurance issued or to be issued;

(iv) for a secondary obligation incurred or to be incurred;

(v) for energy provided or to be provided;

(vi) for the use or hire of a vessel under a charter or other contract;

(vii) arising out of the use of a credit or charge card or information contained on or for use with the card; or

(viii) as winnings in a lottery or other game of chance operated or sponsored by a state, governmental unit of a state, or a person licensed or authorized to operate the game by a state or governmental unit of a state.

(B) The term includes health-care-insurance receivables.

(C) The term does not include:

(i) rights to payment evidenced by chattel paper or an instrument;

(ii) commercial tort claims;

(iii) deposit accounts;

(iv) investment property;

(v) letter-of-credit rights or letters of credit; or

(vi) rights to payment for money or funds advanced or sold, other than rights arising out of the use of a credit or charge card or information contained on or for use with the card.

(3) "Account debtor" means a person obligated on an account, chattel paper, or general intangible. The term does not include persons obligated to pay a negotiable instrument, even if the instrument constitutes part of chattel paper.

(4) "Accounting", except as used in "accounting for", means a record:

(A) authenticated by a secured party;

(B) indicating the aggregate unpaid secured obligations as of a date not more than thirty-five (35) days earlier or thirty-five (35) days later than the date of the record; and

(C) identifying the components of the obligations in reasonable detail.

(5) "Agricultural lien" means an interest, other than a security interest, in farm products:

(A) which secures payment or performance of an obligation for:

(i) goods or services furnished in connection with a debtor?s farming operation; or

(ii) rent on real property leased by a debtor in connection with its farming operation;

(B) which is created by statute in favor of a person that:

(i) in the ordinary course of its business furnished goods or services to a debtor in connection with a debtor?s farming operation; or

(ii) leased real property to a debtor in connection with the debtor?s farming operation; and

(C) whose effectiveness does not depend on the person?s possession of the personal property.

(6) "As-extracted collateral" means:

(A) oil, gas, or other minerals that are subject to a security interest that:

(i) is created by a debtor having an interest in the minerals before extraction; and

(ii) attaches to the minerals as extracted; or

(B) accounts arising out of the sale at the wellhead or minehead of oil, gas, or other minerals in which the debtor had an interest before extraction.

(7) "Authenticate" means:

(A) to sign; or

(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.

(8) "Bank" means an organization that is engaged in the business of banking. The term includes savings banks, savings and loan associations, credit unions, and trust companies.

(9) "Cash proceeds" means proceeds that are money, checks, deposit accounts, or the like.

(10) "Certificate of title" means a certificate of title with respect to which a statute provides for the security interest in question to be indicated on the certificate as a condition or result of the security interest?s obtaining priority over the rights of a lien creditor with respect to the collateral.

(11) "Chattel paper" means a record or records that evidence both a monetary obligation and a security interest in specific goods, a security interest in specific goods and software used in the goods, a security interest in specific goods and license of software used in the goods, a lease of specific goods, or a lease of specific goods and license of software used in the goods. In this paragraph, "monetary obligation" means a monetary obligation secured by the goods or owed under a lease of goods and includes a monetary obligation with respect to software used in the goods. The term does not include charters or other contracts involving the use or hire of a vessel. If a transaction is evidenced by records that include an instrument or series of instruments, the group of records taken together constitutes chattel paper.

(12) "Collateral" means the property subject to a security interest or agricultural lien. The term includes:

(A) proceeds to which a security interest attaches;

(B) accounts, chattel paper, payment intangibles, and promissory notes that have been sold; and

(C) goods that are the subject of a consignment.

(13) "Commercial tort claim" means a claim arising in tort with respect to which:

(A) the claimant is an organization; or

(B) the claimant is an individual and the claim:

(i) arose in the course of the claimant?s business or profession; and

(ii) does not include damages arising out of personal injury to or the death of an individual.

(14) "Commodity account" means an account maintained by a commodity intermediary in which a commodity contract is carried for a commodity customer.

(15) "Commodity contract" means a commodity futures contract, an option on a commodity futures contract, a commodity option, or another contract if the contract or option is:

(A) traded on or subject to the rules of a board of trade that has been designated as a contract market for such a contract pursuant to federal commodities laws; or

(B) traded on a foreign commodity board of trade, exchange, or market, and is carried on the books of a commodity intermediary for a commodity customer.

(16) "Commodity customer" means a person for which a commodity intermediary carries a commodity contract on its books.

(17) "Commodity intermediary" means a person that:

(A) is registered as a futures commission merchant under federal commodities law; or

(B) in the ordinary course of its business provides clearance or settlement services for a board of trade that has been designated as a contract market pursuant to federal commodities law.

(18) "Communicate" means:

(A) to send a written or other tangible record;

(B) to transmit a record by any means agreed upon by the persons sending and receiving the record; or

(C) in the case of transmission of a record to or by a filing office, to transmit a record by any means prescribed by filing-office rule.

(19) "Consignee" means a merchant to which goods are delivered in a consignment.

(20) "Consignment" means a transaction, regardless of its form, in which a person delivers goods to a merchant for the purpose of sale and:

(A) the merchant:

(i) deals in goods of that kind under a name other than the name of the person making delivery;

(ii) is not an auctioneer; and

(iii) is not generally known by its creditors to be substantially engaged in selling the goods of others;

(B) with respect to each delivery, the aggregate value of the goods is One Thousand Dollars ($1,000.00) or more at the time of delivery;

(C) the goods are not consumer goods immediately before delivery; and

(D) the transaction does not create a security interest that secures an obligation.

(21) "Consignor" means a person that delivers goods to a consignee in a consignment.

(22) "Consumer debtor" means a debtor in a consumer transaction.

(23) "Consumer goods" means goods that are used or bought for use primarily for personal, family, or household purposes.

(24) "Consumer-goods transaction" means a consumer transaction in which:

(A) an individual incurs an obligation primarily for personal, family, or household purposes; and

(B) a security interest in consumer goods secures the obligation.

(25) "Consumer obligor" means an obligor who is an individual and who incurred the obligation as part of a transaction entered into primarily for personal, family, or household purposes.

(26) "Consumer transaction" means a transaction in which (i) an individual incurs an obligation primarily for personal, family, or household purposes, (ii) a security interest secures the obligation, and (iii) the collateral is held or acquired primarily for personal, family, or household purposes. The term includes consumer-goods transactions.

(27) "Continuation statement" means an amendment of a financing statement which:

(A) identifies, by its file number, the initial financing statement to which it relates; and

(B) indicates that it is a continuation statement for, or that it is filed to continue the effectiveness of, the identified financing statement.

(28) "Debtor" means:

(A) a person having an interest, other than a security interest or other lien, in the collateral, whether or not the person is an obligor;

(B) a seller of accounts, chattel paper, payment intangibles, or promissory notes; or

(C) a consignee.

(29) "Deposit account" means a demand, time, savings, passbook, or similar account maintained with a bank. The term does not include investment property or accounts evidenced by an instrument.

(30) "Document" means a document of title or a receipt of the type described in paragraph (2) of Section 7-201.

(31) "Electronic chattel paper" means chattel paper evidenced by a record or records consisting of information stored in an electronic medium.

(32) "Encumbrance" means a right, other than an ownership interest, in real property. The term includes mortgages and other liens on real property.

(33) "Equipment" means goods other than inventory, farm products, or consumer goods.

(34) "Farm products" means goods, other than standing timber, with respect to which the debtor is engaged in a farming operation and which are:

(A) crops grown, growing, or to be grown, including:

(i) crops produced on trees, vines, and bushes; and

(ii) aquatic goods produced in aquacultural operations;

(B) livestock, born or unborn, including aquatic goods produced in aquacultural operations;

(C) supplies used or produced in a farming operation; or

(D) products of crops or livestock in their unmanufactured states.

(35) "Farming operation" means raising, cultivating, propagating, fattening, grazing, or any other farming, livestock, or aquacultural operation.

(36) "File number" means the number assigned to an initial financing statement pursuant to subsection (a) of Section 9-519.

(37) "Filing office" means an office designated in Section 9-501 as the place to file a financing statement.

(38) "Filing-office rule" means a rule adopted pursuant to Section 9-526.

(39) "Financing statement" means a record or records composed of an initial financing statement and any filed record relating to the initial financing statement.

(40) "Fixture filing" means the filing of a financing statement covering goods that are or are to become fixtures and satisfying subsections (a) and (b) of Section 9-502. The term includes the filing of a financing statement covering goods of a transmitting utility which are or are to become fixtures.

(41) "Fixtures" means goods that have become so related to particular real property that an interest in them arises under real property law.

(42) "General intangible" means any personal property, including things in action, other than accounts, chattel paper, commercial tort claims, deposit accounts, documents, goods, instruments, investment property, letter-of-credit rights, letters of credit, money, and oil, gas, or other minerals before extraction. The term includes payment intangibles and software.

(43) "Good faith" means honesty in fact and the observance of reasonable commercial standards of fair dealing.

(44) (A) "Goods" means all things that are movable when a security interest attaches.

(B) The term includes:

(i) fixtures;

(ii) standing timber that is to be cut and removed under a conveyance or contract for sale;

(iii) the unborn young of animals

(iv) crops grown, growing, or to be grown, even if the crops are produced on trees, vines, or bushes; and

(v) manufactured homes.

(C) The term also includes a computer program embedded in goods and any supporting information provided in connection with a transaction relating

First published on 01/01/2000

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