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2000 SESSION

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HB 1204 Uniform Commercial Code; Secured Transactions.

Introduced by: Clifton A. (Chip) Woodrum | all patrons    ...    notes | add to my profiles | history

SUMMARY AS PASSED:

Uniform Commercial Code; Secured Transactions. Updates Article 9 (Secured Transactions) of the Uniform Commercial Code, which was last revised in 1972 and adopted in every state. Article 9 provides a statutory framework for transactions that involve the granting of credit secured by personal property. Filing will be with State Corporation Commission only; local filing, other than fixture filings, will be abolished. The new Article 9 generally provides for the filing of a financing statement in the state where the debtor is incorporated. The scope of Article 9 is expanded to include kinds of property such as deposit accounts, health care receivables and commercial tort claims, that were excluded in original Article 9. The location of the debtor rather than the location of the collateral will determine where a security interest perfects. The fee for filing a financing statement is increased from $10 to $20. The bill has an effective date of July 1, 2001. Article 9 is the product of the National Conference of Commissioners of Uniform State Laws.

SUMMARY AS PASSED HOUSE:

Uniform Commercial Code; Secured Transactions. Updates Article 9 (Secured Transactions) of the Uniform Commercial Code which was last revised in 1972 and adopted in every state. Article 9 provides a statutory framework for transactions which involve the granting of credit secured by personal property. Filing will be with State Corporation Commission only, local filing will be abolished. The new Article 9 generally provides for the filing of a financing statement in the state where the debtor is incorporated. Revised Article 9 provides for these changes: (i) the scope of Article 9 is expanded to include kinds of property such as deposit accounts, health care receivables and commercial tort claims, that were excluded in original Article 9; (ii) perfection of a security interest by control is available not only for investment property, but also deposit accounts and letter of credit rights; (iii) the location of the debtor rather than the location of the collateral determines where a security interest perfects; (iv) a simplified and unified system of filing financing statements in one place in each state to perfect security interests replaces the original filing system which allowed certain local filing; (v) consumers obtain certain rights that were not available in original Article 9, such as specific disclosure of any deficiency rights the creditor may have; and (vi) new rules for enforcement, such as a requirement that a creditor notify a secondary obligor when repossessing goods subject to a security interest. The fee for filing a financing statement is increased from $10 to $20. The bill has an effective date of July 1, 2001. Article 9 is the product of the National Conference of Commissioners of Uniform State Laws.

SUMMARY AS INTRODUCED:

Uniform Commercial Code; Secured Transactions. Updates Article 9 (Secured Transactions) of the Uniform Commercial Code which was last revised in 1972 and adopted in every state. Article 9 provides a statutory framework for transactions which involve the granting of credit secured by personal property. Filing will be with State Corporation Commission only, local filing will be abolished. The new Article Nine generally provides for the filing of a financing statement in the state where the debtor is incorporated. Revised Article 9 provides for these changes: (i) the scope of Article 9 is expanded to include kinds of property such as deposit accounts, health care receivables and commercial tort claims, that were excluded in original Article 9; (ii) perfection of a security interest by control is available not only for investment property, but also deposit accounts and letter of credit rights; (iii) the location of the debtor rather than the location of the collateral determines where a security interest perfects; (iv) a simplified and unified system of filing financing statements in one place in each state to perfect security interests replaces the original filing system which allowed certain local filing; (v) consumers obtain certain rights that were not available in original Article 9, such as specific disclosure of any deficiency rights the creditor may have; and (vi) new rules for enforcement, such as a requirement that a creditor notify a secondary obligor when repossessing goods subject to a security interest.

The bill has an effective date of July 1, 2001. Article 9 is the product of the National Conference of Commissioners of Uniform State Laws.