Secured Transactions Assignment 37

Secured Transactions Assignment 37 PowerPoint PPT Presentation


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2. . Debtor. Tax lien. PMSI. Securedparty. Seller. Buyer. Statutorylien. Judgmentlien. Bankruptcytrustee. Executionlien. Personal Property Competitors. . . . . . . . . . 3. Debtor. Tax lien. Purchasemoneymortgage. Mortgage. Seller. BFP forvalue. Mechanic'slien. Judgmentlien. Bankruptcytrustee.

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Secured Transactions Assignment 37

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1. 1 Secured Transactions Assignment 37 Statutory Liens Against Secured Creditors

2. 2

3. 3 Real Estate Competitors

4. 4

5. 5 Security interests Statutory liens Judicial liens Article 9 SI Agricultural Judgment Mortgages Mechanic’s Execution Other SI Tax Attachment Landlord’s Garnishment Charging Equitable Retaining Hospital Warehouse

6. 6 Statutory Lien Issues Does a lien exist? Read the statute. How must the lienor perfect? Read the statute Does §9-310(a) require a financing statement (Ag lien?) What is the lien’s priority? Read the statute Default rule for non-possessory lien: first in time Default rule for possessory lien: ranks first, §9-333(b)

7. 7 Possessory Statutory Liens §9-333 (b) A possessory lien on goods has priority over a security interest . . . unless . . created by a statute that expressly provides otherwise

8. 8 Possessory Statutory Liens §9-333 (b) A possessory lien on goods has priority over a security interest . . . unless . . created by a statute that expressly provides otherwise (a) “[P]ossessory lien” means an interest, other than a security interest or an agricultural lien: (1) which secures payment . . . for services or materials furnished with respect to goods by a person in the ordinary course of the person’s business; (2) which is created by statute or rule of law in favor of the person; (3) whose effectiveness depends on . . . possession of the goods

9. 9 Filing requirements for statutory liens Some lien statutes impose filing requirements (most do not)

10. 10 Filing requirements for statutory liens Some lien statutes impose filing requirements (most do not) Maine garage keeper’s lien, page 607

11. 11 Filing requirements for statutory liens Some lien statutes impose filing requirements (most do not) Maine garage keeper’s lien, page 607 Mechanic’s liens, Assignment 33

12. 12 Filing requirements for statutory liens Some lien statutes impose filing requirements (most do not) Maine garage keeper’s lien, page 607 Mechanic’s liens, Assignment 33 §9-310 imposes a filing requirement for “agricultural liens” (new in 2001).

13. 13 Filing requirements for statutory liens Hypo: Owner rents farmland to tenant who grows corn. Does landlord have a lien under Oregon statute, p. 609? Probably yes. §9-102(a)(44). Corn is “chattels” Is this landlord’s lien an agricultural lien? §9-102(a)(5). Agricultural lien means an interest in farm products . . . (A) which secures payment . . . for . . . rent . . . on real property leased to a debtor in connection with its farming operation (B) which is created by statute in favor of a person that . . . leased real property to a debtor in connection with the debtor’s farming operation; and (C) whose effectiveness does not depend on . . .possession

14. 14 Filing requirements for statutory liens Hypo: Owner rents farmland to tenant who grows corn. Does landlord have a lien under Oregon statute, p. 609? Probably yes. §9-102(a)(44). Corn is “chattels” Is this landlord’s lien an agricultural lien? Yes, landlord must file §9-102(a)(5). Agricultural lien means an interest in farm products . . . (A) which secures payment . . . for . . . rent . . . on real property leased to a debtor in connection with its farming operation (B) which is created by statute in favor of a person that . . . leased real property to a debtor in connection with the debtor’s farming operation; and (C) whose effectiveness does not depend on . . .possession

15. 15 Perishable Agricultural Commodities Act

16. 16 Perishable Agricultural Commodities Act

17. 17 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities,

18. 18 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities,

19. 19 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities

20. 20 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.”

21. 21 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The “statutory trust” grants to sellers and suppliers a priority in payment over even secured lenders.

22. 22 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The “statutory trust” grants to sellers and suppliers a priority in payment over even secured lenders.

23. 23 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The “statutory trust” grants to sellers and suppliers a priority in payment over even secured lenders.

24. 24 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The “statutory trust” grants to sellers and suppliers a priority in payment over even secured lenders.

25. 25 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The “statutory trust” grants to sellers and suppliers a priority in payment over even secured lenders.

26. 26 Perishable Agricultural Commodities Act “The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The “statutory trust” grants to sellers and suppliers a priority in payment over even secured lenders.

27. 27 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051 What is the trustee’s claim to the property? §541, §544(a) Can the trustee defeat Morse’s lien? No. §545(2). This statutory lien would defeat a purchaser under state law.

28. 28 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051 What is the trustee’s claim to the property? §541, §544(a) Can the trustee defeat Morse’s lien? No. §545(2). This statutory lien would defeat a purchaser under state law.

29. 29 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession?

30. 30 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051

31. 31 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051 What is the trustee’s claim to the property? §541, §544(a) Can the trustee defeat Morse’s lien? No. §545(2). This statutory lien would defeat a purchaser under state law.

32. 32 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051 What is the trustee’s claim to the property? §§541, 544, 545

33. 33 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051 What is the trustee’s claim to the property? §§541, 544, 545 Can the trustee defeat Morse’s lien? No. §545(2). This statutory lien would defeat a purchaser under state law.

34. 34 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051 What is the trustee’s claim to the property? §§541, 544, 545 Can the trustee defeat Morse’s lien? No. §545(2). This statutory lien would defeat a purchaser under state law.

35. 35 Problem 37.1.a, page 621 Does Morse have an Artisan’s lien? Yes. §3051 Does Morse have the right to retain possession? Yes. §3051 What is the trustee’s claim to the property? §§541, 544, 545 Can the trustee defeat Morse’s lien? No. §545(2). This statutory lien would defeat a purchaser under state law.

36. 36 Problem 37.1.a, page 621 §9-333(a) “[P]ossessory lien” means an interest, other than a security interest or an agricultural lien: which secures payment . . . for services or materials furnished with respect to goods by a person in the ordinary course of the person’s business; which is created by statute . . . in favor of the person; whose effectiveness depends on .. . possession of the goods (b) A possessory lien on goods has priority over a security interest . . . unless lien is created by a statute that expressly provides otherwise

37. 37 Problem 37.1.a, page 621 §9-333(a) “[P]ossessory lien” means an interest, other than a security interest or an agricultural lien: which secures payment . . . for services or materials furnished with respect to goods by a person in the ordinary course of the person’s business; which is created by statute . . . in favor of the person; whose effectiveness depends on .. . possession of the goods (b) A possessory lien on goods has priority over a security interest . . . unless lien is created by a statute that expressly provides otherwise

38. 38 Problem 37.1.b, page 621

39. 39 Problem 37.1.b, page 621

40. 40 Problem 37.1.b, page 621

41. 41 Problem 37.1.b, page 621

42. 42 Problem 37.1.b, page 621

43. 43 Problem 37.1.b, page 621 Norman did not retain a security interest in the tomatoes

44. 44 Problem 37.1.b, page 621 Norman did not retain a security interest in the tomatoes PACA: “The seller . . . retains a trust claim over these commod-ities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.”

45. 45 Problem 37.1.b, page 621 Norman did not retain a security interest in the tomatoes PACA: “The seller . . . retains a trust claim over these commod-ities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The trust reaches sales to “dealers” (“any person engaged in the business of buying or selling in wholesale quantities . . .“)

46. 46 Problem 37.1.b, page 621 Norman did not retain a security interest in the tomatoes PACA: “The seller . . . retains a trust claim over these commod-ities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The trust reaches sales to “dealers” (“any person engaged in the business of buying or selling in wholesale quantities . . .“) Against what sources can Norman proceed?

47. 47 Problem 37.1.b, page 621 Norman did not retain a security interest in the tomatoes PACA: “The seller . . . retains a trust claim over these commod-ities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The trust reaches sales to “dealers” (“any person engaged in the business of buying or selling in wholesale quantities . . .“) Against what sources can Norman proceed? What is Norman’s priority against Haunt’s accounts lender?

48. 48 Problem 37.1.b, page 621 Norman did not retain a security interest in the tomatoes PACA: “The seller . . . retains a trust claim over these commod-ities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received.” The trust reaches sales to “dealers” (“any person engaged in the business of buying or selling in wholesale quantities . . .“) Against what sources can Norman proceed? What is Norman’s priority against Haunt’s accounts lender? Norman is prior.

49. 49 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC

50. 50 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs

51. 51 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

52. 52 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

53. 53 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

54. 54 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

55. 55 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

56. 56 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

57. 57 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

58. 58 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

59. 59 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

60. 60 Problem 37.2, page 622 Jean grants $7K PMSI to GMAC Without GMAC permission, Jean incurs $3.5K debt to Central for repairs a. Does Central have a lien? Yes, worked at “request of legal possessor.” Also, §9-401(b). b. With what priority? “Subject to . . . [GMAC] but only for charges in excess of $1,500 . . .”

61. 61 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back?

62. 62 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back? Rule 1.16(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practical to protect a client’s interest, such as . . . surrendering papers . . . to which the client is entitled.

63. 63 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back? Rule 1.16(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practical to protect a client’s interest, such as . . . surrendering papers . . . to which the client is entitled. The lawyer may retain papers relating to the client to the extent permitted by other law.

64. 64 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back? Rule 1.16(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practical to protect a client’s interest, such as . . . surrendering papers . . . to which the client is entitled. The lawyer may retain papers relating to the client to the extent permitted by other law. Does the Illinois statute permit us to retain the will?

65. 65 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back? Rule 1.16(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practical to protect a client’s interest, such as . . . surrendering papers . . . to which the client is entitled. The lawyer may retain papers relating to the client to the extent permitted by other law. Does the Illinois statute permit us to retain the will? No

66. 66 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back? Rule 1.16(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practical to protect a client’s interest, such as . . . surrendering papers . . . to which the client is entitled. The lawyer may retain papers relating to the client to the extent permitted by other law. Does the Illinois statute permit us to retain the will? No “Illinois common law recognizes an attorney retaining lien.

67. 67 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back? Rule 1.16(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practical to protect a client’s interest, such as . . . surrendering papers . . . to which the client is entitled. The lawyer may retain papers relating to the client to the extent permitted by other law. Does the Illinois statute permit us to retain the will? No “Illinois common law recognizes an attorney retaining lien. This lien allows an attorney to retain papers and property of a client until the attorney fees are paid or the client posts a security for payment.” Carrizales v. Board of Education, 2004 U.S. Dist. LEXIS (N.D. Ill.).”

68. 68 Problem 37.3, page 623 Client gave us his will. We did work for client; client hasn’t paid. Do we have to give his will back? Rule 1.16(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practical to protect a client’s interest, such as . . . surrendering papers . . . to which the client is entitled. The lawyer may retain papers relating to the client to the extent permitted by other law. Does the Illinois statute permit us to retain the will? No “Illinois common law recognizes an attorney retaining lien. This lien allows an attorney to retain papers and property of a client until the attorney fees are paid or the client posts a security for payment.” Carrizales v. Board of Education, 2004 U.S. Dist. LEXIS (N.D. Ill.).” Is that fair?

69. 69 Problem 37.4, page 623 a. Debtor owes $42K rent to Oaks Mall, store closed.

70. 70 Problem 37.4, page 623 a. Debtor owes $42K rent to Oaks Mall, store closed. Against what does Oaks have a lien? (Oregon statute, page 609) Equipment in store $25K Inventory in store $25K Fixtures in store $25K Equipment removed $5K Accounts not from store $10K

71. 71 Problem 37.4, page 623 a. Debtor owes $42K rent to Oaks Mall, store closed. Against what does Oaks have a lien? (Oregon statute, page 609) Equipment in store $25K Lien Inventory in store $25K Lien Fixtures in store $25K Lien Equipment removed $5K Lien? Accounts not from store $10K No lien

72. 72 Problem 37.4, page 623 a. Debtor owes $42K rent to Oaks Mall, store closed. Against what does Oaks have a lien? (Oregon statute, page 609) Equipment in store $25K Lien Inventory in store $25K Lien Fixtures in store $25K Lien Equipment removed $5K Lien? Accounts not from store $10K No lien

73. 73 Problem 37.4, page 623 a. Debtor owes $42K rent to Oaks Mall, store closed. Against what does Oaks have a lien? (Oregon statute, page 609) Equipment in store $25K Lien Inventory in store $25K Lien Fixtures in store $25K Lien Equipment removed $5K Lien? Accounts not from store $10K No lien

74. 74 Problem 37.4, page 623 a. Debtor owes $42K rent to Oaks Mall, store closed. Against what does Oaks have a lien? (Oregon statute, page 609) Equipment in store $25K Lien Inventory in store $25K Lien Fixtures in store $25K Lien Equipment removed $5K Lien? Accounts not from store $10K No lien

75. 75 Problem 37.4, page 623

76. 76 Problem 37.4, page 623

77. 77 Problem 37.4, page 623

78. 78 Problem 37.4, page 623

79. 79 Problem 37.4, page 623

80. 80 Problem 37.4, page 623

81. 81 Problem 37.4, page 623

82. 82 Problem 37.4, page 623

83. 83 Problem 37.4, page 623

84. 84 Problem 37.4, page 623

85. 85 Problem 37.4, page 623

86. 86 Problem 37.5, page 624 In New Jersey, Massachusetts and Connecticut, clean up liens have priority over mortgages.

87. 87 Problem 37.5, page 624 In New Jersey, Massachusetts and Connecticut, clean up liens have priority over mortgages. Governor wants to know how those laws are working.

88. 88 Problem 37.5, page 624 In New Jersey, Massachusetts and Connecticut, clean up liens have priority over mortgages. Governor wants to know how those laws are working. What questions do we ask?

89. 89 Problem 37.5, page 624 In New Jersey, Massachusetts and Connecticut, clean up liens have priority over mortgages. Governor wants to know how those laws are working. What questions do we ask? Do debtors pollute? Do debtors or the state clean up? Does the state collect? Can real property owners get loans? What do loans cost?

90. 90 Problem 37.5, page 624 In New Jersey, Massachusetts and Connecticut, clean up liens have priority over mortgages. Governor wants to know how those laws are working. What questions do we ask? Do debtors pollute? Do debtors or the state clean up? Does the state collect? Can real property owners get loans? What do loans cost? Of whom do we ask the questions?

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