ATTACHMENT Flashcards
ATTACHMENT MECHANISMS
- Sec Agreement
OR - Creditor retains possession or control (consignment inventory)
SEC AGREEMENT
a. Writing Record and show intent to create security interest
b. Authenticated by Debtor (Any symbol with present intent)
c. Description of Collateral (Reasonably identify the collateral)
ATTACHMENT ELEMENTS
AGREEMENT (PAC)
VALUE (FOR RIGHT)
RIGHTS (IN COLLATERAL)
ART 9 COVERS
GOODS
INTANGIBLES
FIXTURES
ACCESSIONS
ART 9 GOODS
1- Consumer Goods - Personal
2- Equipment (catch all)
3- Farm Products (S AND P)
4- Inventory
ART 9 INTANGIBLES
- Instruments
- Documents
- Chattel paper
- Investment property
- Accounts
- Deposit Accounts
- Commercial Tort Claims
- General Intangibles (Catch All)
ART 9 FIXTURES
Goods that have become so related to particular real property that an interest in them arises under real property law.
ART 9 TRANSACTIONS
TRANSACCIONAL CREATES SI IN
- personal property or fixtures by contract;
- an agricultural lien;
- a sale of accounts, chattel paper, payment intangibles, or promissory notes;
- certain consignments; or
- a secured sale disguised as a lease.
FUTURE ADVANCE CLAUSE
Will give you money in the future, attached to same collateral (RETAINS PRIORITY)
AFTER ACQUIRED PROPERTY CLAUSE:
All of the present and future collateral. Without an explicit after-acquired property clause in the security agreement, the secured party’s security interest only reaches collateral that the debtor had rights in at the time the debtor signed the security agreement.
EXCEPTIONS TO AAPC
- INVENTORY OR ACCOUNTS WILL IMPLY AAPC
- NO SI OVER CONSUMER GOODS IF D DOES NOT GET IN 10 DAYS AFTER C GIVES VALUE
- INEFFECTIVE AS TO COMMERCIAL TORTS CLAIMS
PROCEEDS FOR ST
RESULT OF DISPOSTION
INSURANCE
CLAIMS
CASH (LOWEST INTERMEDIATE BALANCE)
IDENTIFIABLE PROCEEDS
SI AUTOMATICALLY GIVES RIGHT TO IDENTIFIABLE PROCEEDS: PROVE OR TRACK TO COLLATERAL (BURDEN ON CREDITOR)
SUPPORTING OBLIGATION
The attachment of a security interest in collateral also is an attachment of a security interest in a supporting obligation for that collateral.
LOWEST INTERMEDIATE BALANCE TEST (LIBT)
The lowest balance between time of identifiable cash and test application. Comprises the secured identifiable “proceeds,” but may not exceed value of original cash proceeds deposited.
