Secured Transactions

Question 1

Article 9 security interest

Answer 1

consensual lien on personal property

Question 2

Types of personal property (goods)

Answer 2

1. Consumer goods
2. Farm products
3. Inventory
   - goods held for sale
   - goods held for lease
   - goods that are rapidly consumed
4. Equipment (residual category)

Question 3

Account (definition)

Answer 3

Right to payment arising out of one of the transactions w/n article 9

Question 4

Types of Accounts

Answer 4

1. Sale of goods

2. Rendition of services

Question 5

Article 9 instrument

Answer 5

Article 3 negotiable instrument

Question 6

Types of Personal Property (non-goods)

Answer 6

1. Accounts
2. NIs
3. Chattel Paper
4. Deposit Accounts
5. Documents
6. Investment Property
7. Commercial Tort Claims (CTCs)
8. General Intangibles

Question 7

Chattel Paper

Answer 7

1. Written lease of personal property

2. Documentation generated by a secured transaction

Question 8

Deposit Accounts (not included)

Answer 8

Consumer account when the transaction is for a consumer purpose

Question 9

CTCs

Answer 9

1. Any tort claim that a business has is a CMT

2. Tort claims by individuals are CMTs if they arise out of the operation of a biz + do not involve PI.

Question 10

General intangibles

Answer 10

Residual category for all non-goods

Question 11

Attachment (effect)

Answer 11

Article 9 event when a creditor acquires a security interest and becomes a secured party.

Attachment creates rights against the debtor

Question 12

Attachment events (Very Rich Shit)

Answer 12

1. Value given
2. Debtor has to have rights in the collateral
3. SOF

Question 13

Article 9 SOF

Answer 13

1. Debtor must authenticate
2. Evidences grant of security interest
3. Describe collateral

Question 14

Article 9 SOF description

Answer 14

*Cannot be super-generic

OK:
“All inventory”
“All equipment”
“All chattel paper”

Question 15

Description of CTCs

Answer 15

Must be somewhat specific (date)

Question 16

Description of consumer goods

Answer 16

Even more specific:
OK:
“All furniture”
“All snowmobiles”

Question 17

SOF Exception

Answer 17

Possession by secured party

Question 18

After acquired property clauses

Answer 18

OK

Exceptions:

• CMTs
• Consumer goods must be acquired w/n 10 days of value given

Question 19

Future advance clauses

Answer 19

Eliminates the need for multiple security agreements

Question 20

Proceeds (effect)

Answer 20

Security interest will automatically attach to identifiable proceeds

Question 21

Proceeds (definition)

Answer 21

Anything the debtor acquires as a consequence of the debtor’s rights int he collateral

Question 22

Perfection by Financial Statement

Answer 22

Perfects a security interest in all types of collateral except - deposit accounts

Question 23

Correct filing state

Answer 23

Where debtor is located regardless of the location of collateral

Question 24

Financial Statement Elements

Answer 24

1. Debtor name
2. Secured party name
3. Description of collateral
4. Authorized by debtor

Question 25

Filing statement duration

Answer 25

5 years

Question 26

Perfection by possession

Answer 26

Valid but not for: - account - CTC - general intangible - deposit account

Question 27

Perfection by control

Answer 27

ok for deposit accounts

Question 28

Automatic perfection (def)

Answer 28

Perfection upon attachment

Question 29

Purchase-money security interest

Answer 29

Applies only to goods

Question 30

How to get a PMSI

Answer 30

- sell goods on credit | - lend an enabling loan

Question 31

Priority: two secured interests, both unperfected

Answer 31

1st to attach

Question 32

Priority: two secured interest, one unperfected

Answer 32

Perfected security interest

Question 33

Priority: two secured interest, both perfected

Answer 33

1st to file or perfect

Question 34

Priority: Secured party vs buyer

Answer 34

Presumption goes to secured party

Question 35

Priority: Secured party vs buyer (exceptions)

Answer 35

1. BOCB 2. Yard Sale 3. Latest buyer exception

Question 36

BOCB exception

Answer 36

1. Buy goods 2. From someone in the business of selling the type of goods in question 3. w/o notice 4. Seller created the security interest

Question 37

Yard Sale exception

Answer 37

1. consumer goods 2. sold as consumer goods 3. W/o notice 4. Secured interest relies on automatic perfection (didn't file)

Question 38

Latest buyer exception

Answer 38

- Applies to unperfected security interests | - w/o notice

Question 39

Priority: Secured party vs. judicial lien creditor

Answer 39

General rule: perfected SI gets priority

Question 40

Insecurity clause

Answer 40

Secured party right to declare default if uneasy about possibility of repayment - good faith

Question 41

Secured party rights upon default

Answer 41

right to possession

Question 42

Self-help repossession no-no's

Answer 42

Cannot: breach the peace! go into an enclosure! continue against debtor objection!

Question 43

Secured party rights upon repossession

Answer 43

1. Sell by public or private sale 2. Must be commercially reasonable 3. Must notify debtor