Rep. Kenneth Dunkin

Filed: 4/25/2011

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 1692

2    AMENDMENT NO. ______. Amend Senate Bill 1692 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Uniform Commercial Code is amended by
5changing Section 9-510 and by adding Section 9-513A as follows:
 
6    (810 ILCS 5/9-510)
7    Sec. 9-510. Effectiveness of filed record.
8    (a) Filed record effective if authorized. A filed record is
9effective only to the extent that it was filed by a person that
10may file it under Section 9-509 or by the filing office under
11Section 9-513A.
12    (b) Authorization by one secured party of record. A record
13authorized by one secured party of record does not affect the
14financing statement with respect to another secured party of
15record.
16    (c) Continuation statement not timely filed. A

 

 

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1continuation statement that is not filed within the six-month
2period prescribed by Section 9-515(d) is ineffective.
3(Source: P.A. 91-893, eff. 7-1-01.)
 
4    (810 ILCS 5/9-513A new)
5    Sec. 9-513A. Termination of wrongfully filed financing
6statement; reinstatement.
7    (a) Qualified person. In this Section, the term "qualified
8person" means an individual who, at the time the financing
9statement referred to in subsection (b) was filed or within
10five years prior to the time of filing, either held a judicial
11or prosecutorial office in this State or was an elected or
12appointed official of this State.
13    (b) Application of this Section. This Section applies only
14with respect to a filed financing statement that (i) indicates
15that all secured parties of record are individuals, (ii)
16identifies as a debtor a qualified person, and (iii) was filed
17by an individual not entitled to do so under Section 9-509(a).
18If the financing statement identifies more than one debtor, the
19provisions of this Section apply only with respect to those
20debtors who are qualified persons.
21    (c) Affidavit of wrongful filing. A qualified person may
22file in the filing office a notarized affidavit, signed under
23penalty of perjury, that identifies a filed financing statement
24that indicates that all secured parties of record are
25individuals and states that (i) the affiant held a judicial or

 

 

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1prosecutorial office in this State or was an elected or
2appointed official of this State at, or within five years prior
3to, the time the financing statement was filed, and (ii) the
4financing statement was filed by an individual not entitled to
5do so under Section 9-509(a). The Secretary of State shall
6adopt a form of affidavit for use under this Section.
7    (d) Termination statement by filing office. If an affidavit
8is filed under subsection (c), the filing office shall promptly
9file a termination statement with respect to the financing
10statement identified in the affidavit. The termination
11statement must indicate that it was filed pursuant to this
12Section. Except as provided in subsection (h) or (i), a
13termination statement filed under this subsection shall take
14effect 30 days after it is filed.
15    (e) No fee charged or refunded. The filing office shall not
16charge a fee for the filing of an affidavit under subsection
17(c) or a termination statement under subsection (d). The filing
18office shall not return any fee paid for filing the financing
19statement identified in the affidavit, whether or not the
20financing statement is reinstated under subsection (i).
21    (f) Notice of termination statement. On the same day that a
22filing office files a termination statement under subsection
23(d), it shall send to each secured party of record for the
24financing statement a notice advising the secured party of
25record that the termination statement has been filed. The
26notice shall be sent by certified mail, return receipt

 

 

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1requested, to the address provided for the secured party in the
2financing statement.
3    (g) Action by secured party of record. An individual
4indicated as secured party of record on a financing statement
5as to which a termination statement has been filed under
6subsection (d) may, before or after the termination statement
7takes effect, bring an action against the individual who filed
8the affidavit under subsection (c) seeking a determination that
9the financing statement was filed by a person entitled to do so
10under Section 9-509(a). An action under this subsection shall
11have priority on the court's calendar and shall proceed by
12expedited hearing. If the individual who filed the affidavit
13resides in this State, the exclusive venue in this State for
14the action shall be in the circuit court for the county where
15the individual principally resides in this State. If the
16individual who filed the affidavit does not reside in this
17State, the exclusive venue in this State shall be in the
18circuit court for the county where the filing office in which
19the financing statement was filed is located.
20    (h) Preliminary relief. In an action brought pursuant to
21subsection (g), a court may, in appropriate circumstances,
22order preliminary relief, including but not limited to an order
23precluding the termination statement from taking effect or
24directing a party to take action to prevent the termination
25statement from taking effect. If the court issues such an order
26and the filing office receives a certified copy of the order

 

 

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1before the termination statement takes effect as provided in
2subsection (d), the termination statement shall not take effect
3and the filing office shall promptly file an amendment to the
4financing statement that indicates that an order has prevented
5the termination statement from taking effect. If such an order
6ceases to be effective by reason of a subsequent order or a
7final judgment of that court or by an order issued by another
8court, and the filing office receives a certified copy of the
9subsequent judgment or order, the termination statement shall
10immediately be effective and the filing office shall file an
11amendment to the financing statement indicating that the
12termination statement is effective.
13    (i) Final judgment or order. If, in an action under
14subsection (g), the court determines that the financing
15statement was filed by a person entitled to do so under Section
169-509(a) and the filing office receives a certified copy of the
17court's final judgment or order before the termination
18statement takes effect, the termination statement shall not
19take effect and the filing office shall remove the termination
20statement and any amendments filed under subsection (h) from
21the files. If the filing office receives the certified copy
22after the termination statement takes effect and within 30 days
23after the final judgment or order was entered, the filing
24office shall promptly file an amendment to the financing
25statement that indicates that the financing statement has been
26reinstated.

 

 

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1    (j) Effect of reinstatement. Except as provided in
2subsection (k), upon the filing of an amendment reinstating a
3financing statement under subsection (i) the effectiveness of
4the financing statement is retroactively reinstated and the
5financing statement shall be considered never to have been
6ineffective against all persons and for all purposes.
7    (k) Exception to subsection (i). A financing statement
8whose effectiveness is reinstated under subsection (i) shall
9not be effective as against a person that purchased the
10collateral in good faith to the extent the person gave new
11value, in reliance on the termination statement, between the
12time the termination statement was filed and the time of the
13filing of the record reinstating the financing statement.
14    (l) Liability for wrongful filing. If, in an action under
15subsection (g), the court declares that the financing statement
16was not filed by a person entitled to do so under Section
179-509(a), the qualified person may recover from the individual
18who brought the action the costs and expenses, including
19reasonable attorneys' fees, that the qualified person incurred
20in the action. This recovery is in addition to any recovery to
21which the qualified person is entitled under Section 9-625 or
22under law other than this Article.
23    (m) Action to compel removal of termination statement not
24precluded. This Section does not preclude an individual
25wrongfully identified as a debtor on a financing statement or
26an individual secured party of record from bringing an action

 

 

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1under law other than this Act seeking appropriate relief.".