Collateral Flashcards
TERMS
Collateral definition
= the property subject to a security interest
TERMS
Secured Party definition
= a person in whose favor a security interest is created or provided for under a security agreement, whether or not any obligation to be secured is outstanding
TERMS
Debtor Definition
= a person having an interest in the collateral, whether or not the person is an obligor
TERMS
Obligor definition
= a person who owes payment or other performance of the obligation
TERMS
Definition of “goods”
(+ 5 insane things included in that category)
= tangible, moveable, personal property
category includes
- fixtures
- standing timber that is to be cut and removed under a contract for sale
- the unborn young of animals
- crops grown, growing, or to be grown, and
- manufactured homes
TERMS
4 sub-categories of goods
- Consumer Goods
- Inventory
- Farm Products
- Equipment
TERMS
Definition of consumer goods
= goods that are used or bought for use primarily for personal, family, or household purposes
TERMS
Definition of inventory
= good held for sale or lease
Also includes goods furnished under services contracts
Also includes materials used or consumed in a business in a short period of time
TERMS
Farm products definition (4 parts)
= crops, livestock, supplies used or produced in farming operations, or products of crops/livestock in unmanufactured states IF in the possession of debtor engaged in farming operations
Examples = maple syrup, milk
TERMS
Equipment definition
= goods other than inventory, farm products, or consumer goods
TERMS
Instrument definition
= negotiable instruments
Examples = checks, notes, drafts
TERMS
Definition of chattel paper
= record(s) which evidence BOTH a monetary obligation AND a security interest in or a lease of specific goods
Stored in an electronic medium = electronic chattel paper
TERMS
Two types of documents covered under the “documents” category
(1) warehouse receipt
(2) bill of lading
TERMS
Investment property definition
= a security, whether certificated or uncertificated, security entitlement, securities account, commodity contract, or commodity account.
TERMS
Account definition
= right to payment for property sold or services rendered (aka account receivable)
TERMS
Deposit account definition
= account maintained with a bank (bank account)
Article 9 only applies to non-consumer deposit accounts
TERMS
Commercial tort claim definition
= claim arising in tort with respect to which
- claimant is an organization OR
- claimant is an individual and claim arose in scope of business/profession and not personal injury to individual
TERMS
General intangible definition
= any personal property that doesn’t come within scope of other definitions
Default/catchall category
Examples = liquor license, tax refund claim, intellectual property stuff like patents, trademarks, licenses
TESTS FOR THE TEST
Test for classifying collateral
Look to see how DEBTOR is using the collateral
INTANGIBLE GOODS
8 Types of intangible goods
Instruments Documents Chattel paper Investment property Account Deposit accounts Commercial tort claim General intangible (catchall)
TERMS
Document definition
= special documents evidencing that the person in possession of it is entitled to receive, hold, and dispose of the document and the goods that it covers
Example = bill of lading, warehouse receipt
