Business Law: Secured Transactions (UCC Article 9)

What are the three essential requirements for a security interest to attach under UCC Article 9?

For a security interest to attach, there must be a valid security agreement, value given by the secured party, and the debtor must have rights in the collateral.

How does UCC Article 9 define 'consumer goods'?

Consumer goods are goods that are used or bought for use primarily for personal, family, or household purposes.

What type of security interest perfects automatically upon attachment without filing or possession?

A Purchase Money Security Interest (PMSI) in consumer goods perfects automatically upon attachment.

What is the general priority rule between two conflicting perfected security interests in the same collateral?

The general rule is that the first secured party to file or perfect has priority.

Under what condition may a secured party repossess collateral without judicial process upon the debtor's default?

A secured party may repossess collateral without judicial process only if it can be done without a breach of the peace.

Under Article 9, what is an 'account'?

An account is a right to payment of a monetary obligation for property that has been sold, leased, or licensed, or for services rendered.

What are the formal requirements for an authenticated security agreement to be valid under Article 9?

A valid authenticated security agreement must be in a record, authenticated (signed) by the debtor, and contain a reasonable description of the collateral.

What three pieces of information must be included in a standard UCC-1 financing statement for it to be effective?

An effective UCC-1 financing statement must include the name of the debtor, the name of the secured party (or representative), and an indication of the collateral covered.

How does the Buyer in Ordinary Course of Business (BIOC) rule affect a perfected security interest created by the buyer's seller?

A Buyer in Ordinary Course of Business takes the goods 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.

How can a secured party obtain superpriority for a Purchase Money Security Interest (PMSI) in equipment?

A PMSI in equipment has superpriority over conflicting security interests if the PMSI is perfected at the time the debtor receives possession of the collateral or within 20 days thereafter.