Attachment Flashcards

1
Q

Effect of attachment

A

Once SI has attached, SP has the enforcement rights under Article 9 (including right to repossess)

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2
Q

When SI attaches

A

(1) SP gives VALUE;
(2) Debtor has RIGHTS in the collateral; and
(3) Debtor has authenticated a security AGREEMENT that sufficiently describes the collateral

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3
Q

Description requirement of security agreement

A

The description of collateral must reasonably identify what is described, including by UCC type (except for a transaction with a consumer for consumer goods)

A super-generic description (e.g., “All Debtor’s property”) is insufficient

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4
Q

Attachment of after-acquired collateral

A

SI attaches to after-acquired collateral if the agreement contains an express after-acquired- collateral clause

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5
Q

Automatic SI in after-acquired collateral (without clause)

A
  • An interest in INVENTORY or ACCOUNTS receivable automatically creates SI in after-acquired collateral
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6
Q

Attaching future advances

A

The security agreement can provide that the collateral secured future advances (more money loaned to debtor after agreement, that also turns into collateral) (e.g., revolving-credit agreement)

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7
Q

Attaching proceeds

A

SI automatically extends to identifiable proceeds of the collateral

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8
Q

After-acquired collateral rule for consumer goods

A

A security agreement can’t cover after-acquired consumer goods unless Debtor acquires rights in the good within 10 days of the SP giving value

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