Corporate

Recent Posts

The Ongoing Issue of the Debtor's Name on UCC Article 9 Financing Statements
Posted on 25 Jul 2012 by Margit Livingston

There are any number of potential pitfalls along the way to properly setting up a secured transaction, but perhaps the most bedeviling stems from the failure to set forth the debtor's name correctly on the financing statement. As a recent bankruptcy... Read More

Perfecting Security Interests in Manufactured Homes
Posted on 19 Feb 2009 by James P. Nehf

Unsure about perfecting a security interest in a manufactured home? Professor James P. Nehf discusses the relationship between Article 9, certificate of title laws, and real estate recording systems. Prof. Nehf writes: Perfecting security interests... Read More

The Uniform Commercial Code and the Transfer of Mortgage Notes
Posted on 27 Jul 2012 by Margit Livingston

The Permanent Editorial Board for the U.C.C. recently issued a report explaining the Code provisions relevant to the transfer and enforcement of mortgage notes. This report highlights the particular provisions of Articles 3 and 9 that pertain to who can... Read More

Debtor Name Changes under U.C.C. Article 9
Posted on 30 Mar 2010 by Margit Livingston

Dealing with debtor name changes can be a tricky problem for secured parties. Only three pieces of information are required on a financing statement--the debtor's name, the name of the secured party or its representative, and an indication of the... Read More

Continuity of Perfection Following a Merger
Posted on 6 Jan 2009 by James P. Nehf

Professor James P. Nehf discusses the way Article 9 handles corporate mergers and the steps creditors must take to remain continuously perfected in a debtors assets after the merger occurs by addressing. Ensuring that a security interest remains perfected... Read More

Purchase Money Inventory Security Interests Under U.C.C. Article 9
Posted on 4 Oct 2008 by Margit Livingston

Priorities among Article 9 secured parties holding security interests in the same collateral are normally governed by the first-to-file or perfect rule. Despite the rules obvious merits, the Article 9 drafters recognized that it might hamper the debtors... Read More

Rights in Collateral and Estoppel Under U.C.C. Article 9
Posted on 8 Oct 2008 by Margit Livingston

In its simplest sense, the requirement that the debtor have rights in the collateral before the security interest can attach follows intuitively from the idea that "you can't alienate what you don't own." Those who allow a debtor unrestrained... Read More

Prioritizing Creditors: The Doctrine of Equitable Marshaling
Posted on 10 Jan 2011 by Margit Livingston

Excerpt: Under Article 9 (Secured Transactions) of the Uniform Commercial Code, the default rule for priority among secured creditors is the first-to-file-or-perfect. U.C.C. § 9-322 (a)(1) (Official Text 2009). In other words, the secured party... Read More

Article 9 Security Interests in Commercial Tort Claims
Posted on 4 Nov 2011 by Margit Livingston

Security interests in commercial tort claims require special attention to ensure that they are properly created and perfected under UCC Article 9. This is demonstrated by two recent Court of Appeals decisions. Ultimately, both Courts of Appeal held... Read More

UCC Article 9 Security Interests and Voidable Sales Contracts
Posted on 18 Nov 2011 by Margit Livingston

Credit sellers of large-ticket items reserve security interests in the items sold to secure the buyer's payment of the purchase price. These creditors sometimes get off track by assuming that Article 9 does not apply to the transaction. In a recent... Read More

Professor Margit Livingston on Mishaps Involving a Termination Statement, a Correction Statement, and a Last-Minute Financing Statement Under U.C.C. Article 9
Posted on 21 Aug 2012 by Margit Livingston

Although Article 9 of the Uniform Commercial Code has attempted to make perfection an easily attainable goal for secured parties, mistakes still occur, and many of them prove fatal to the secured creditor's perfected status. The secured party in a... Read More

Alternatives "A" and "B": Debtor Names Under Revised UCC Section 9-503
Posted on 26 Oct 2011 by Jennifer Martin

Failure to correctly identify a debtor on a financing statement can be fatal to a creditor's attempted filing of a security interest. Newly adopted amendments to Uniform Commercial Code Article 9 are designed to clear up some areas of confusion regarding... Read More

Transfers of Cash Proceeds Under U.C.C. Article 9
Posted on 18 Dec 2009 by Margit Livingston

Despite a pro-secured creditor treatment of cash proceeds, the Uniform Commercial Code puts at least one significant limitation on the secured party's ability to recover cash proceeds upon the debtor's default. If the debtor transfers cash proceeds... Read More

A New Twist on Debtor Names on U.C.C. Article 9 Financing Statements
Posted on 29 Oct 2012 by Margit Livingston

Public filing of a financing statement is the common method of achieving perfection of a security interest. Article 9 is unforgiving towards debtor name errors because the debtor's name is the gateway to the filing system. A recent federal district... Read More

2010 Amendments to Article 9: Debtor's Name on Financing Statements
Posted on 18 Nov 2010 by Margit Livingston

Excerpt: The Uniform Commercial Code itself, scholarly articles, and judicial decisions have long emphasized the importance of the debtor's name on an Article 9 financing statement. The debtor's name is one of only three pieces of information... Read More

  • Blog Post: Professor Margit Livingston on The Debtor's Name on Article 9 Financing Statements

    Revised U.C.C. Article 9 imposes a clear, specific, objective rule for measuring the sufficiency of a financing statement filed under a name other than the debtor's correct name. In examining this “single search” standard, Professor of Law Margit Livingston writes: Taken as a whole...
  • Blog Post: Margit Livingston on Achieving Attachment of Article 9 Security Interests

    Creditors seeking enforceable security interests in their debtors’ collateral must attach their security interests under U.C.C Article 9, ideally by means of a well-drafted security agreement. Professor of Law Margit Livingston discusses the concept and In re Rowe, 369 B.R. 73 (Bankr. D. Mass....
  • Blog Post: Chattel Paper Priorities Under U.C.C. Article 9

    In this Expert Commentary, Professor Margit Livingston explains what chattel paper is and the special priority rules that apply to it under the Uniform Commercial Code. Professor Livingston writes: The principal architect of original Article 9 of the Uniform Commercial Code, Professor Grant Gilmore...
  • Blog Post: Professor Margit Livingston on Priorities in Accounts Under U.C.C. Article 9

    Accounts receivables or "receivables," which constitute a significant part of many enterprises' assets, are frequently proffered as collateral in secured lending transactions. Consequently, Article 9 secured parties must understand how to create and perfect security interests in accounts...
  • Blog Post: Conducting Foreclosure Sales Under U.C.C. Article 9

    Article 9 secured parties reserve security interests in their debtors collateral as a means of securing the debtors repayment. Sometimes the debtor, however, will default under the security agreement, and the secured party will be forced to repossess the collateral. After seizing the collateral, the...
  • Blog Post: Purchase Money Inventory Security Interests Under U.C.C. Article 9

    Priorities among Article 9 secured parties holding security interests in the same collateral are normally governed by the first-to-file or perfect rule. Despite the rules obvious merits, the Article 9 drafters recognized that it might hamper the debtors ability to get credit in the future, so the drafters...
  • Blog Post: Rights in Collateral and Estoppel Under U.C.C. Article 9

    In its simplest sense, the requirement that the debtor have rights in the collateral before the security interest can attach follows intuitively from the idea that "you can't alienate what you don't own." Those who allow a debtor unrestrained use and possession of their property, by...
  • Blog Post: Punishing Creditor Misbehavior in U.C.C. Article 9 Foreclosure Sales

    In the current recessionary climate, more and more secured creditors are faced with the prospect of defaults by their debtors and the need to proceed with foreclosure of their security interests. Article 9 of the Uniform Commercial Code requires secured parties undertaking foreclosure sales to follow...
  • Blog Post: Breach of the Peace in Self-Help Repossession under U.C.C. Article 9

    The recent financial crisis has caused a number of debtors to default on their loan obligations, and as a result, more and more secured creditors are repossessing the collateral securing their loans. The UCC permits self-help repossession if the creditor can seize the collateral without breaching the...
  • Blog Post: Continuity of Perfection Following a Merger

    Professor James P. Nehf discusses the way Article 9 handles corporate mergers and the steps creditors must take to remain continuously perfected in a debtors assets after the merger occurs by addressing. Ensuring that a security interest remains perfected after a corporate merger depends on the identity...
  • Blog Post: Perfecting Security Interests in Manufactured Homes

    Unsure about perfecting a security interest in a manufactured home? Professor James P. Nehf discusses the relationship between Article 9, certificate of title laws, and real estate recording systems. Prof. Nehf writes: Perfecting security interests in a manufactured home, and maintaining perfection...
  • Blog Post: Consignments Under U.C.C. Article 9

    As the economy continues to weaken across all sectors, consignment arrangements may become more attractive to dealers. In the typical consignment, the consignor is a manufacturer of goods that wishes to sell them in the market. The consignee is a dealer in such goods and offers to try to sell the consignors...
  • Blog Post: Collateral Descriptions on Article 9 Financing Statements

    Under the U.C.C., to be effective, a filed financing statement must contain the debtors name, the secured partys name (or the name of its representative), and an indication of the collateral. In a recent decision, the Eighth Circuit Court of Appeals held that the secured party’s indication of collateral...
  • Blog Post: Transfers of Cash Proceeds Under U.C.C. Article 9

    Despite a pro-secured creditor treatment of cash proceeds, the Uniform Commercial Code puts at least one significant limitation on the secured party's ability to recover cash proceeds upon the debtor's default. If the debtor transfers cash proceeds to certain good faith transferees, those transferees...
  • Blog Post: Professor Margit Livingston on Article 9 Security Interests in Deposit Accounts

    In this Emerging Issues commentary, Professor Margit Livingston of DePaul University College of Law discusses the special problems under UCC Article 9 that's posed by security interests in deposit accounts. She references a 2009 Nebraska Supreme Court decision that reveals that depository banks that...
  • Blog Post: Putative Leases as Article 9 Secured Transactions

    In most cases, filing a financing statement will protect the lessor/secured party from other secured parties. However, one type of transaction has bedeviled the courts for many years--the secured transaction disguised as a lease. Professor examines whether a corporation's possessory repairman's...
  • Blog Post: Debtor Name Changes under U.C.C. Article 9

    Dealing with debtor name changes can be a tricky problem for secured parties. Only three pieces of information are required on a financing statement--the debtor's name, the name of the secured party or its representative, and an indication of the collateral. Sometimes debtors run amok, drastically...
  • Blog Post: Buyers in Ordinary Course of Business Under U.C.C. Article 9

    The buyer in ordinary course of business ("BIOCOB"), usually takes free of even perfected security interests. In a recent federal district court case, the court tackled the issue of what it takes to be a BIOCOB in a situation where the buyer had not yet taken physical possession of the collateral...
  • Blog Post: Fixtures and Fixture Filings under U.C.C. Article 9

    Professor Margit Livingston analyzes a recent bankruptcy case in which the court apparently misunderstood the distinction between chattel perfection and fixture filings. Professor Livingston writes: To perfect security interests under Article 9 of the Uniform Commercial Code, secured parties normally...
  • Blog Post: Article 9 Purchase Money Security Interests in Livestock

    Under UCC Article 9, the priority scheme rewards the creditor who is first to give notice of its security interest. One of the few exceptions to the rule, however, is the superpriority afforded certain purchase money secured parties. This Emerging Issues Analysis addresses a case where the collateral...
  • Blog Post: 2010 Amendments to Article 9: Debtor's Name on Financing Statements

    Excerpt: The Uniform Commercial Code itself, scholarly articles, and judicial decisions have long emphasized the importance of the debtor's name on an Article 9 financing statement. The debtor's name is one of only three pieces of information absolutely required on a filed financing statement...
  • Blog Post: 2010 Amendments to U.C.C. Article 9: Changes in the Debtor's Location

    Excerpt: Generally, the law of the debtor's location governs perfection issues under Article 9 of the Uniform Commercial Code. In other words, the debtor's location controls the place of filing of financing statements giving notice of Article 9 security interests. U.C.C. § 9-301 (1) (Official...
  • Blog Post: Alternatives "A" and "B": Debtor Names Under Revised UCC Section 9-503

    Failure to correctly identify a debtor on a financing statement can be fatal to a creditor's attempted filing of a security interest. Newly adopted amendments to Uniform Commercial Code Article 9 are designed to clear up some areas of confusion regarding how debtors' names appear on financing...
  • Blog Post: Article 9 Security Interests in Commercial Tort Claims

    Security interests in commercial tort claims require special attention to ensure that they are properly created and perfected under UCC Article 9. This is demonstrated by two recent Court of Appeals decisions. Ultimately, both Courts of Appeal held that the secured party's security interest did...
  • Blog Post: UCC Article 9 Security Interests and Voidable Sales Contracts

    Credit sellers of large-ticket items reserve security interests in the items sold to secure the buyer's payment of the purchase price. These creditors sometimes get off track by assuming that Article 9 does not apply to the transaction. In a recent Virginia Supreme Court decision, an automobile dealer...