sec tranny

Question 1

Factors when its not really a lease

Answer 1

when not subject to early termination, or for life of economic good or at the end its aquired for 0 consideration

Question 2

8 kinds of collateral

Answer 2

good
- equipment - non-inventory, farm goods, or consumer goods
- consumer goods
inventory
farm goods
intangible intangibles
tangible intangibles 
investment property

Question 3

to create a security interest

Answer 3

a written sec agreement or possession

AND attachment

Question 4

reqs of a written security agreement

Answer 4

writen and signed by Debtor
contains a granting clause
contains a description of collateral

Not needed if possession

Question 5

PMSI

Answer 5

a security interest in goods that are purchase money collateral

• if incurred - as part of furnishment by seller
• for value by outside creditor so the value is used for that good

Question 6

when does a security interest attach

Answer 6

when secured party gives value

when debtor has rights in collateral

when debtor signs a security agreement that describes collateral

description - by type unless consumer transaction

Question 7

exceptions to reqs for after acquired collateral

Answer 7

if: sec agreement is for inventory or AR

if consumer goods - debtor acquires rights within 10 days of secured party giving value

Question 8

when secured ps interest ends with sale

Answer 8

if secured party authorizes sale free of sec interest

Question 9

perfection definition

Answer 9

establishes secured parties rights against 3Ps

Question 10

4 methods to perfect

Answer 10

filing
possession
control
automatically

Question 11

who is filling done with

Answer 11

sec of state, or office of county clerk if a fixture

Question 12

how to determine which sec of state

Answer 12

jdx where debtor is located, if a non-registered org - chief executive office, if a registered state - where it is organized

Question 13

how to create a filling to perfect

Answer 13

file financing statement

Question 14

requirements of filing statement

Answer 14

name of debtor
name of secured party
description of collateral - can use supergeneric here
authorization by debtor

Question 15

fixtures exception

Answer 15

fixtures are so related to real property that interest passesd under real estate law

Question 16

fixture filing statement

Answer 16

name of debtor, of secured party, description, authorization AND

that it covers fixtures, that is filed with real property records, description of real property it is attached to, real property owner name

Question 17

What makes a filing ineffective

Answer 17

filed in wrong place
does include requisite information
not authorized

Question 18

filing statement containing minor errors will….

Answer 18

be effective unless errors make it seriously misleading

seriously misleading - incorrect name of debtor unless search logic exception

Question 19

when can a financing statement be filed

Answer 19

before security agreement is made or attachment

Question 20

changes which affect a financing statement

Answer 20

name changes - if information becomes misleading, change of name or exchange of OG collateral for proceeds or dfebtor moves

Question 21

if p changes name

Answer 21

financing statement only effective for 4 months unless ammended

Question 22

if debtor moves

Answer 22

must file new financing, perfected from date of OG

Question 23

duration of filing statement

Answer 23

5 years of filing, amended w/i 6 months of end of 5 years

Question 24

what types of collateral can be perfected via possession

Answer 24

tangible negotiable instruments, goods, instruments, money paper,

Question 25

what types of collateral can be perfected via control

Answer 25

- investment securities - letter of credit rights (with assignment consented to) - deposit accounts - via with bank who is opposing party, with record showing consent, with secured party being a customer to account

Question 26

automatic perfection

Answer 26

PMSIs usually - if consumer goods - prefected as soon as sec interest attaches and is permanent Or if secured party takes only a small amount of accounts which are

Question 27

Special rules RE first in time, first in right for instruments or chattel paper -

Answer 27

whoever has possession trumps perfection via filing

Question 28

second in time, first in right for PMSIs

Answer 28

if perfected w/i 20 days of debtor taking possession of collateral - gets priority unless - collateral is inventory - secured party must: - notify first secured party it has a PMSI - perfect upon reciept of inventory

Question 29

a secured party has priority over liens if

Answer 29

perfects before liens interest arises OR files a financing statement and evidences a security agreement before lien

Question 30

PMSI and liens

Answer 30

if PMSI perfected w/i 20 days of recieving collateral- will take priority over leins

Question 31

accessions

Answer 31

goods physically united but in a way that the identity of OG good is not lost - priority established in same manner, but smaller good is subordinate to interest in largest good, which is perfected RE title statute - IE only cars and trucks or fixtures

Question 32

commingled goods

Answer 32

physically united with such goods that their identity is lost IE

Question 33

when a security interest does not survive sale of collateral

Answer 33

seller authorizes sale sans security interest BICOB - if one buys in GF, without knowledge that sale violates rights of another, in OCOB, from someone who sells that kind of goods garage sale exception - consumer good from person who previously knew of that, without knowledge of interest AND financing statement not filed

Question 34

point of fixtures filing

Answer 34

to have priority over creditor who holds mortgage

Question 35

rights of fixture filing

Answer 35

A secured party with priority over a mortgagee has the right to remove the fixture from the real property upon the debtor’s default

Question 36

fixture filing priority

Answer 36

first in time, first in right, unless it is a PMSI

Question 37

what are secured parties right post default

Answer 37

file for judgement, foreclose, or otherwise enforece, including repo

Question 38

what is breach of peace

Answer 38

an act likely to lead to violence - always BOP unauthorized entry into home- always BOP

Question 39

if secured party cannot repo without BOP

Answer 39

bring action for replevin - sheriff can seize

Question 40

SP's rights post default if it is secured against AR, instruments or chattel papers

Answer 40

notify person who will be making payment, signed by secured party or debtor, Iding rights assigned

Question 41

how can debtor redeem collateral

Answer 41

pay obligation + interest + expenses for attorney's fees for default BEFORE 1. collateral is collected 2. SP disposes of property or enters K re that 3. SP accepts collateral in satisfaction of obligation

Question 42

how can debtor's redemption rights be waived

Answer 42

in writing immediately after default ONLY

Question 43

rights of SP post default and repo

Answer 43

may dispose of property in any commercially reasonable manner, considering - in usual manner or any recognized market, - at price current in any recognized market, - according to best practices

Question 44

SP need to notify

Answer 44

Sp must send anyone with interest in collateral notice of disposition Exception - if it is perishable, quickly declining in value, or sold on stock market

Question 45

notification reqs

Answer 45

must be given in reasonable time pre-sale - 10 days in commercial transactions non-consumer transactions - description of Ps, collateral, method of disposition, location of dispoisition consumer tnx - description of any liability for deficiency, number to redeem

Question 46

how proceeds are paid out

Answer 46

1. fees incurred by secured party in retaking, selling, disposing, and legal 2. satisfaction of amount owed 3. satisfaction of amount owed to others if SP receives demand 4. debtor

Question 47

if sale does not pay debt,

Answer 47

SP entitled to a judgement for deficiency, unless disposed of in an unreasonable manner

Question 48

rebuttable presumption rule

Answer 48

if non-consumer tnx, deficiency can be reduced if debtor proves that sale was commercially unreasonable down to 0 - then the SP can rebut the presumption with evidence that the collateral is worth less than the outstanding amount of the debt