ST Drills

Question 1

unperfected vs. unperfected

Answer 1

first to attach

Question 2

perfected vs unperfected

Answer 2

perfected

Question 3

perfected secured vs. perfected secured

Answer 3

first to file or perfect

Question 4

PMSI in inventory wins IF

Answer 4

(1) perfected when debtor gets possession of the inventory (wasn’t perfected beforehand)
(2) notice to prior creditors

Question 5

PMSI in equipment wins IF

Answer 5

(1) perfected before or within 20 days after debtor gets possession of the equipment

Question 6

PMSI seller vs. PMSI lender

Answer 6

Seller

Question 7

generally, perfected vs. perfected

Answer 7

first to file or perfect wins

Question 8

After-acquired equipment vs. PMSI

Answer 8

PMSI will win if they perfect within 20 days, otherwise after-acquired equipment will win

Question 9

How is a consumer goods PMSI perfected

Answer 9

automatic

Question 10

What does a PMSI in consumer goods have priority over?

Answer 10

everyone but a BIOCB and consumer-to-consumer transactions

Question 11

How does a PMSI in non-consumer, non-inventory, non-fixture goods become perfected?

Answer 11

filing within 20 days of receiving collateral

Question 12

What does a PMSI in non-consumer, non-inventory, non-fixture goods have priority over?

Answer 12

Everyone but a BIOCB

Question 13

How is a PMSI in fixtures perfected

Answer 13

Filing a fixture filing prior to 20 days of the goods becoming fixtures

Question 14

What does a PMSI in fixtures have priority over

Answer 14

everyone but a construction mortgage

Question 15

How is a PMSI in inventory perfected?

Answer 15

Filing prior to the debtor receiving possession AND sending proper notice to conflicting security interests

Question 16

What does a PMSI in inventory have priority over

Answer 16

Everyone but a BIOCB

Question 17

When does a buyer take free of an unperfected security interest?

Answer 17

when the buyer gives value, receives delivery of collateral, buys w/o knowledge of the preexisting security interest

Question 18

A BIOCB takes free of a security interest created by the buyer’s seller, even if the security interest is perfected and the buyer knows of its existence if the following conditions are met:

Answer 18

1. Buyer buys goods (excluding farm products)
2. From a merchant who is in the business of selling goods of that kind
3. In good faith and without actual knowledge that the sale violates rights of another in the same goods

Question 19

Can you say “all assets”? in an agreement?

Answer 19

No - not specific enough

Question 20

If you have an interest in a fixture, what do you need to do to perfect it?

Answer 20

FILE THE FINANCING STATEMENT IN THE OFFICE OF THE COUNTY WHERE THE PROPERTY IS LOCATED

Question 21

Security interest in fixtures vs future real-property interest

Answer 21

A security interest in fixtures has priority over an interest in the real property with which the fixtures are associated if the security interest in fixtures is perfected by a fixture filing before the real-property interest is recorded

Question 22

A PMSI in fixtures has priority over a prior interest in the real property with which the fixtures are associated when:

Answer 22

i) The debtor has an interest of record in the real property (e.g., is an owner) or is in possession of the real property (e.g., is a lessee); and
ii) The security interest is perfected by a fixture filing before the goods become fixtures or within 20 days thereafter.

Question 23

Can you have partial satisfaction for a consumer good in default?

Answer 23

No! only full satisfaction - partial satisfaction is void.

Question 24

If the goods are consumer goods in the possession of the secured party, and the debtor has paid 60 percent of the cash price in the case of a PMSI, or 60 percent of the obligation secured in a non-PMSI case, can the secured party keep them in satisfaction of the debt?

Answer 24

No - the secured party cannot keep the goods in satisfaction of the debt; they must be sold.

Question 25

Remedy for someone breaching repossession rules for consumer good

Answer 25

interest + 10% of purchase price

Question 26

When has something attached/when is it enforceable?

Answer 26

i) Value has been given by the secured party;
ii) The debtor has rights in the collateral; and
iii) The debtor has authenticated a security agreement that describes the collateral, or the secured party has possession or control of the collateral pursuant to a security agreement

Question 27

Does a bank with control over a deposit account like a savings account have priority over all interests?

Answer 27

Yes

Question 28

what can be perfected by possession (good investors never dare tip chatty people)

Answer 28

Goods, instruments, negotiable documents, tangible chattel paper

Question 29

What can be perfected by control

Answer 29

deposit accounts, investment property, electronic documents or chattel paper, letter of credit rights