Full Text of SB3764 97th General Assembly
SB3764enr 97TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning business.
| 2 | | Be it enacted by the People of the State of Illinois, | 3 | | represented in the General Assembly:
| 4 | | Section 5. The Uniform Commercial Code is amended by | 5 | | changing Sections 2A-103, 9-102, 9-105, 9-307, 9-311, 9-316, | 6 | | 9-317, 9-326, 9-406, 9-408, 9-502, 9-503, 9-507, 9-515, 9-516, | 7 | | 9-518, 9-521, 9-607, and 9-625 and by adding Part 8 to Article | 8 | | 9 as follows:
| 9 | | (810 ILCS 5/2A-103) (from Ch. 26, par. 2A-103)
| 10 | | Sec. 2A-103. Definitions and index of definitions.
| 11 | | (1) In this Article unless the context otherwise requires:
| 12 | | (a) "Buyer in ordinary course of business" means a
| 13 | | person who, in good faith and without knowledge that the | 14 | | sale to
him or her is in violation of the ownership rights | 15 | | or security
interest or leasehold interest of a third party | 16 | | in the goods, buys
in ordinary course from a person in the | 17 | | business of selling
goods of that kind but does not include | 18 | | a pawnbroker.
"Buying" may be for cash or by exchange of | 19 | | other property or
on secured or unsecured credit and | 20 | | includes acquiring
goods or
documents of title under a | 21 | | pre-existing contract for sale but
does not include a | 22 | | transfer in bulk or as security for or in total
or partial | 23 | | satisfaction of a money debt.
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| 1 | | (b) "Cancellation" occurs when either party puts an
end | 2 | | to the lease contract for default by the other party.
| 3 | | (c) "Commercial unit" means such a unit of goods as
by | 4 | | commercial usage is a single whole for purposes of lease | 5 | | and
division of which materially impairs its character or | 6 | | value on the
market or in use. A commercial unit may be a | 7 | | single article, as
a machine, or a set of articles, as a | 8 | | suite of furniture or a line
of machinery, or a quantity, | 9 | | as a gross or carload, or any other
unit treated in use or | 10 | | in the relevant market as a single whole.
| 11 | | (d) "Conforming" goods or performance under a lease
| 12 | | contract means goods or performance that are in accordance | 13 | | with
the obligations under the lease contract.
| 14 | | (e) "Consumer lease" means a lease that a lessor
| 15 | | regularly engaged in the business of leasing or selling | 16 | | makes to
a lessee who is an individual and who takes under | 17 | | the lease
primarily for a personal, family, or household | 18 | | purpose, if the
total payments to be made under the lease | 19 | | contract, excluding
payments for options to renew or buy, | 20 | | do not exceed $40,000.
| 21 | | (f) "Fault" means wrongful act, omission, breach, or
| 22 | | default.
| 23 | | (g) "Finance lease" means a lease with respect to | 24 | | which:
| 25 | | (i) the lessor does not select, manufacture, or | 26 | | supply the goods;
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| 1 | | (ii) the lessor acquires the goods or the right to | 2 | | possession and use
of the goods in connection with the | 3 | | lease; and
| 4 | | (iii) one of the following occurs:
| 5 | | (A) the lessee receives a copy of the contract | 6 | | by which the lessor
acquired the goods or the right | 7 | | to possession and use of the goods
before signing | 8 | | the lease contract;
| 9 | | (B) the lessee's approval of the contract by | 10 | | which the lessor acquired
the goods or the right to | 11 | | possession and use of the goods is a
condition to | 12 | | effectiveness of the lease contract;
| 13 | | (C) the lessee, before signing the lease | 14 | | contract, receives an
accurate and complete | 15 | | statement designating the promises and warranties,
| 16 | | and any disclaimers of warranties, limitations or | 17 | | modifications of
remedies, or liquidated damages, | 18 | | including those of a third party, such as
the | 19 | | manufacturer of the goods, provided to the lessor | 20 | | by the person
supplying the goods in connection | 21 | | with or as part of the contract by which
the lessor | 22 | | acquired the goods or the right to possession and | 23 | | use of the
goods; or
| 24 | | (D) if the lease is not a consumer lease, the | 25 | | lessor, before the
lessee signs the lease | 26 | | contract, informs the lessee in writing (a) of the
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| 1 | | identity of the person supplying the goods to the | 2 | | lessor, unless the lessee
has selected that person | 3 | | and directed the lessor to acquire the goods or
the | 4 | | right to possession and use of the goods from that | 5 | | person, (b) that the
lessee is entitled under this | 6 | | Article to the promises and warranties,
including | 7 | | those of any third party, provided to the lessor by | 8 | | the person
supplying the goods in connection with | 9 | | or as part of the contract by which
the lessor | 10 | | acquired the goods or the right to possession and | 11 | | use of the
goods, and (c) that the lessee may | 12 | | communicate with the person
supplying the goods to | 13 | | the lessor and receive an accurate and complete
| 14 | | statement of those promises and warranties, | 15 | | including any disclaimers and
limitations of them | 16 | | or of remedies.
| 17 | | (h) "Goods" means all things that are movable at the
| 18 | | time of identification to the lease contract, or are | 19 | | fixtures
(Section 2A-309), but the term does not include | 20 | | money,
documents, instruments, accounts, chattel paper, | 21 | | general
intangibles, or minerals or the like, including oil | 22 | | and gas,
before extraction. The term also includes the | 23 | | unborn young of
animals.
| 24 | | (i) "Installment lease contract" means a lease | 25 | | contract
that authorizes or requires the delivery of goods | 26 | | in separate lots
to be separately accepted, even though the |
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| 1 | | lease contract
contains a clause "each delivery is a | 2 | | separate lease" or its
equivalent.
| 3 | | (j) "Lease" means a transfer of the right to possession
| 4 | | and use of goods for a term in return for consideration, | 5 | | but a
sale, including a sale on approval or a sale or | 6 | | return, or
retention or creation of a security interest is | 7 | | not a lease.
Unless the context clearly indicates | 8 | | otherwise, the term includes
a sublease.
| 9 | | (k) "Lease agreement" means the bargain, with respect
| 10 | | to the lease, of the lessor and the lessee in fact as found | 11 | | in
their language or by implication from other | 12 | | circumstances
including course of dealing or usage of trade | 13 | | or course of
performance as provided in this Article. | 14 | | Unless the context
clearly indicates otherwise, the term | 15 | | includes a sublease
agreement.
| 16 | | (l) "Lease contract" means the total legal obligation
| 17 | | that results from the lease agreement as affected by this | 18 | | Article
and any other applicable rules of law. Unless the | 19 | | context
clearly indicates otherwise, the term includes a | 20 | | sublease
contract.
| 21 | | (m) "Leasehold interest" means the interest of the
| 22 | | lessor or the lessee under a lease contract.
| 23 | | (n) "Lessee" means a person who acquires the right to
| 24 | | possession and use of goods under a lease. Unless the | 25 | | context
clearly indicates otherwise, the term includes a | 26 | | sublessee.
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| 1 | | (o) "Lessee in ordinary course of business" means a
| 2 | | person who in good faith and without knowledge that the | 3 | | lease to
him or her is in violation of the ownership rights | 4 | | or security
interest or leasehold interest of a third party | 5 | | in the goods leases
in ordinary course from a person in the | 6 | | business of selling or
leasing goods of that kind but does | 7 | | not include a pawnbroker.
"Leasing" may be for cash or by | 8 | | exchange of other property or
on secured or unsecured | 9 | | credit and includes acquiring
goods or
documents of title | 10 | | under a pre-existing lease contract but does
not include a | 11 | | transfer in bulk or as security for or in total or
partial | 12 | | satisfaction of a money debt.
| 13 | | (p) "Lessor" means a person who transfers the right
to | 14 | | possession and use of goods under a lease. Unless the
| 15 | | context clearly indicates otherwise, the term includes a
| 16 | | sublessor.
| 17 | | (q) "Lessor's residual interest" means the lessor's
| 18 | | interest in the goods after expiration, termination, or
| 19 | | cancellation of the lease contract.
| 20 | | (r) "Lien" means a charge against or interest in goods
| 21 | | to secure payment of a debt or performance of an | 22 | | obligation, but
the term does not include a security | 23 | | interest.
| 24 | | (s) "Lot" means a parcel or a single article that is | 25 | | the
subject matter of a separate lease or delivery, whether | 26 | | or not it
is sufficient to perform the lease contract.
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| 1 | | (t) "Merchant lessee" means a lessee that is a
merchant | 2 | | with respect to goods of the kind subject to the lease.
| 3 | | (u) "Present value" means the amount as of a date
| 4 | | certain of one or more sums payable in the future, | 5 | | discounted to
the date certain. The discount is determined | 6 | | by the interest
rate specified by the parties if the rate | 7 | | was not manifestly
unreasonable at the time the transaction | 8 | | was entered into;
otherwise, the discount is determined by | 9 | | a commercially
reasonable rate that takes into account the | 10 | | facts and
circumstances of each case at the time the | 11 | | transaction was
entered into.
| 12 | | (v) "Purchase" includes taking by sale, lease,
| 13 | | mortgage, security interest, pledge, gift, or any other | 14 | | voluntary
transaction creating an interest in goods.
| 15 | | (w) "Sublease" means a lease of goods the right to
| 16 | | possession and use of which was acquired by the lessor as a
| 17 | | lessee under an existing lease.
| 18 | | (x) "Supplier" means a person from whom a lessor
buys | 19 | | or leases goods to be leased under a finance lease.
| 20 | | (y) "Supply contract" means a contract under which a
| 21 | | lessor buys or leases goods to be leased.
| 22 | | (z) "Termination" occurs when either party pursuant
to | 23 | | a power created by agreement or law puts an end to the | 24 | | lease
contract otherwise than for default.
| 25 | | (2) Other definitions applying to this Article and the
| 26 | | Sections in which they appear are:
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| 1 | | "Accessions". Section 2A-310(1).
| 2 | | "Construction mortgage". Section 2A-309(1)(d).
| 3 | | "Encumbrance". Section 2A-309(1)(e).
| 4 | | "Fixtures". Section 2A-309(1)(a).
| 5 | | "Fixture filing". Section 2A-309(1)(b).
| 6 | | "Purchase money lease". Section 2A-309(1)(c).
| 7 | | (3) The following definitions in other Articles apply to
| 8 | | this Article:
| 9 | | "Account". Section 9-102(a)(2).
| 10 | | "Between merchants". Section 2-104(3).
| 11 | | "Buyer". Section 2-103(1)(a).
| 12 | | "Chattel paper". Section 9-102(a)(11).
| 13 | | "Consumer goods". Section 9-102(a)(23).
| 14 | | "Document". Section 9-102(a)(30).
| 15 | | "Entrusting". Section 2-403(3).
| 16 | | "General intangible". Section 9-102(a)(42).
| 17 | | "Good faith". Section 2-103(1)(b).
| 18 | | "Instrument". Section 9-102(a)(47).
| 19 | | "Merchant". Section 2-104(1).
| 20 | | "Mortgage". Section 9-102(a)(55).
| 21 | | "Pursuant to commitment". Section 9-102(a)(69) | 22 | | 9-102(a)(68) .
| 23 | | "Receipt". Section 2-103(1)(c).
| 24 | | "Sale". Section 2-106(1).
| 25 | | "Sale on approval". Section 2-326.
| 26 | | "Sale or return". Section 2-326.
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| 1 | | "Seller". Section 2-103(1)(d).
| 2 | | (4) In addition, Article 1 contains general definitions and
| 3 | | principles of construction and interpretation applicable
| 4 | | throughout this Article.
| 5 | | (Source: P.A. 95-895, eff. 1-1-09.)
| 6 | | (810 ILCS 5/9-102) (from Ch. 26, par. 9-102)
| 7 | | Sec. 9-102. Definitions and index of definitions.
| 8 | | (a) Article 9 definitions. In this Article:
| 9 | | (1) "Accession" means goods that are physically united | 10 | | with other
goods in such a manner that the identity of the | 11 | | original goods is not lost.
| 12 | | (2) "Account", except as used in "account for", means a | 13 | | right to
payment of a monetary obligation, whether or not | 14 | | earned by performance, (i) for
property that has been or is | 15 | | to be sold, leased, licensed, assigned, or
otherwise
| 16 | | disposed of, (ii) for services rendered or to be rendered, | 17 | | (iii) for a policy
of
insurance issued or to be issued, | 18 | | (iv) for a secondary obligation incurred or
to be
incurred, | 19 | | (v) for energy provided or to be provided, (vi) for the use | 20 | | or hire
of a
vessel under a charter or other contract, | 21 | | (vii) arising out of the use of a
credit or
charge card or | 22 | | information contained on or for use with the card, or | 23 | | (viii) as
winnings in a lottery or other game of chance | 24 | | operated or sponsored by a State,
governmental unit of a | 25 | | State, or person licensed or authorized to operate the
game
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| 1 | | by a State or governmental unit of a State. The term | 2 | | includes
health-care-insurance
receivables. The term does | 3 | | not include (i) rights to payment evidenced by
chattel
| 4 | | paper or an instrument, (ii) commercial tort claims, (iii) | 5 | | deposit accounts,
(iv)
investment property, (v) | 6 | | letter-of-credit rights or letters of credit, or (vi)
| 7 | | rights to
payment for money or funds advanced or sold, | 8 | | other than rights arising out of
the
use of a credit or | 9 | | charge card or information contained on or for use with the
| 10 | | card.
| 11 | | (3) "Account debtor" means a person obligated on an | 12 | | account, chattel
paper, or general intangible. The term | 13 | | does not include persons obligated to
pay a
negotiable | 14 | | instrument, even if the instrument constitutes part of | 15 | | chattel
paper.
| 16 | | (4) "Accounting", except as used in "accounting for", | 17 | | means a record:
| 18 | | (A) authenticated by a secured party;
| 19 | | (B) indicating the aggregate unpaid secured | 20 | | obligations as of a date
not more than 35 days earlier | 21 | | or 35 days later than the date of the record; and
| 22 | | (C) identifying the components of the obligations | 23 | | in reasonable
detail.
| 24 | | (5) "Agricultural lien" means an interest, other than a | 25 | | security
interest,
in farm products:
| 26 | | (A) which secures payment or performance of an |
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| 1 | | obligation for goods or services furnished in | 2 | | connection with a debtor's
farming operation;
| 3 | | (B) which is created by statute in favor of a | 4 | | person that in the ordinary course of its business | 5 | | furnished goods or
services to a debtor in connection | 6 | | with a debtor's farming operation; and
| 7 | | (C) whose effectiveness does not depend on the | 8 | | person's possession
of the personal property.
| 9 | | (6) "As-extracted collateral" means:
| 10 | | (A) oil, gas, or other minerals that are subject to | 11 | | a security interest
that:
| 12 | | (i) is created by a debtor having an interest | 13 | | in the minerals
before extraction; and
| 14 | | (ii) attaches to the minerals as extracted; or
| 15 | | (B) accounts arising out of the sale at the | 16 | | wellhead or minehead of
oil, gas, or other minerals in | 17 | | which the debtor had an interest before
extraction.
| 18 | | (7) "Authenticate" means:
| 19 | | (A) to sign; or
| 20 | | (B) with present intent to adopt or accept a | 21 | | record, to attach to or logically associate with the | 22 | | record an electronic sound, symbol, or process to | 23 | | execute or otherwise adopt a symbol, or encrypt or | 24 | | similarly
process a record in whole or in part, with | 25 | | the present intent of the
authenticating
person to | 26 | | identify the person and adopt or accept a record .
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| 1 | | (8) "Bank" means an organization that is engaged in the | 2 | | business of
banking. The term includes savings banks, | 3 | | savings and loan associations, credit
unions, and trust | 4 | | companies.
| 5 | | (9) "Cash proceeds" means proceeds that are money, | 6 | | checks, deposit
accounts, or the like.
| 7 | | (10) "Certificate of title" means a certificate of | 8 | | title with respect to
which a statute provides for the | 9 | | security interest in question to be indicated on the
| 10 | | certificate as a condition or result of the security | 11 | | interest's obtaining
priority over
the rights of a lien | 12 | | creditor with respect to the collateral. The term includes | 13 | | another record maintained as an alternative to a | 14 | | certificate of title by the governmental unit that issues | 15 | | certificates of title if a statute permits the security | 16 | | interest in question to be indicated on the record as a | 17 | | condition or result of the security interest's obtaining | 18 | | priority over the rights of a lien creditor with respect to | 19 | | the collateral.
| 20 | | (11) "Chattel paper" means a record or records that | 21 | | evidence both a
monetary obligation and a security interest | 22 | | in specific goods, a security
interest in
specific goods | 23 | | and software used in the goods, a security interest in | 24 | | specific
goods and license of software used in the goods, a | 25 | | lease of specific goods,
or a lease of specified goods and | 26 | | a license of
software
used in the goods. In this paragraph, |
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| 1 | | "monetary obligation" means a monetary
obligation secured | 2 | | by the goods or owed under a lease of the goods and | 3 | | includes
a monetary obligation with respect to software | 4 | | used in the goods. The term
does not include (i) charters | 5 | | or other contracts involving the use or hire of a
vessel or | 6 | | (ii) records that evidence a right to payment arising out | 7 | | of the use
of a credit or charge card or information | 8 | | contained on or for use with the
card. If a transaction is | 9 | | evidenced by records that include an instrument or
series | 10 | | of
instruments, the group of records taken together
| 11 | | constitutes chattel paper.
| 12 | | (12) "Collateral" means the property subject to a | 13 | | security interest or
agricultural lien. The term includes:
| 14 | | (A) proceeds to which a security interest | 15 | | attaches;
| 16 | | (B) accounts, chattel paper, payment intangibles, | 17 | | and promissory
notes that have been sold; and
| 18 | | (C) goods that are the subject of a consignment.
| 19 | | (13) "Commercial tort claim" means a claim arising in | 20 | | tort with respect
to which:
| 21 | | (A) the claimant is an organization; or
| 22 | | (B) the claimant is an individual and the claim:
| 23 | | (i) arose in the course of the claimant's | 24 | | business or profession;
and
| 25 | | (ii) does not include damages arising out of | 26 | | personal injury to or
the death of an individual.
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| 1 | | (14) "Commodity account" means an account maintained | 2 | | by a
commodity intermediary in which a commodity contract | 3 | | is carried for a commodity
customer.
| 4 | | (15) "Commodity contract" means a commodity futures | 5 | | contract, an
option on a commodity futures contract, a | 6 | | commodity option, or another contract if
the contract or | 7 | | option is:
| 8 | | (A) traded on or subject to the rules of a board of | 9 | | trade that has been
designated as a contract market for | 10 | | such a contract pursuant to federal commodities
laws; | 11 | | or
| 12 | | (B) traded on a foreign commodity board of trade, | 13 | | exchange, or
market, and is carried on the books of a | 14 | | commodity intermediary for a commodity
customer.
| 15 | | (16) "Commodity customer" means a person for which a | 16 | | commodity
intermediary carries a commodity contract on its | 17 | | books.
| 18 | | (17) "Commodity intermediary" means a person that:
| 19 | | (A) is registered as a futures commission merchant | 20 | | under federal
commodities law; or
| 21 | | (B) in the ordinary course of its business provides | 22 | | clearance or
settlement services for a board of trade | 23 | | that has been designated as a contract
market pursuant | 24 | | to federal commodities law.
| 25 | | (18) "Communicate" means:
| 26 | | (A) to send a written or other tangible record;
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| 1 | | (B) to transmit a record by any means agreed upon | 2 | | by the persons
sending and receiving the record; or
| 3 | | (C) in the case of transmission of a record to or | 4 | | by a filing office, to
transmit a record by any means | 5 | | prescribed by filing-office rule.
| 6 | | (19) "Consignee" means a merchant to which goods are | 7 | | delivered in a
consignment.
| 8 | | (20) "Consignment" means a transaction, regardless of | 9 | | its form, in
which a person delivers goods to a merchant | 10 | | for the purpose of sale and:
| 11 | | (A) the merchant:
| 12 | | (i) deals in goods of that kind under a name | 13 | | other than the name
of the person making delivery;
| 14 | | (ii) is not an auctioneer; and
| 15 | | (iii) is not generally known by its creditors | 16 | | to be substantially
engaged in selling the goods of | 17 | | others;
| 18 | | (B) with respect to each delivery, the aggregate | 19 | | value of the goods is
$1,000 or more at the time of | 20 | | delivery;
| 21 | | (C) the goods are not consumer goods immediately | 22 | | before delivery;
and
| 23 | | (D) the transaction does not create a security | 24 | | interest that secures an
obligation.
| 25 | | (21) "Consignor" means a person that delivers goods to | 26 | | a consignee in
a consignment.
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| 1 | | (22) "Consumer debtor" means a debtor in a consumer | 2 | | transaction.
| 3 | | (23) "Consumer goods" means goods that are used or | 4 | | bought for use
primarily for personal, family, or household | 5 | | purposes.
| 6 | | (24) "Consumer-goods transaction" means a consumer | 7 | | transaction in
which:
| 8 | | (A) an individual incurs an obligation primarily | 9 | | for personal, family,
or household purposes; and
| 10 | | (B) a security interest in consumer goods secures | 11 | | the obligation.
| 12 | | (25) "Consumer obligor" means an obligor who is an | 13 | | individual and
who incurred the obligation as part of a | 14 | | transaction entered into primarily for
personal, family, | 15 | | or household purposes.
| 16 | | (26) "Consumer transaction" means a transaction in | 17 | | which (i) an
individual incurs an obligation primarily for | 18 | | personal, family, or household
purposes, (ii) a security | 19 | | interest secures the obligation, and (iii) the collateral | 20 | | is held
or acquired primarily for personal, family, or | 21 | | household purposes. The term
includes consumer-goods | 22 | | transactions.
| 23 | | (27) "Continuation statement" means an amendment of a | 24 | | financing
statement which:
| 25 | | (A) identifies, by its file number, the initial | 26 | | financing statement to
which it relates; and
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| 1 | | (B) indicates that it is a continuation statement | 2 | | for, or that it is filed
to continue the effectiveness | 3 | | of, the identified financing statement.
| 4 | | (28) "Debtor" means:
| 5 | | (A) a person having an interest, other than a | 6 | | security interest or other
lien, in the collateral, | 7 | | whether or not the person is an obligor;
| 8 | | (B) a seller of accounts, chattel paper, payment | 9 | | intangibles, or
promissory notes; or
| 10 | | (C) a consignee.
| 11 | | (29) "Deposit account" means a demand, time, savings, | 12 | | passbook,
nonnegotiable certificates of deposit,
| 13 | | uncertificated certificates of deposit, nontransferrable | 14 | | certificates of
deposit, or
similar account maintained | 15 | | with a bank. The term does not include investment
property | 16 | | or accounts evidenced by an instrument.
| 17 | | (30) "Document" means a document of title or a receipt | 18 | | of the type
described in Section 7-201(b).
| 19 | | (31) "Electronic chattel paper" means chattel paper | 20 | | evidenced by a
record or records consisting of information | 21 | | stored in an electronic medium.
| 22 | | (32) "Encumbrance" means a right, other than an | 23 | | ownership interest, in
real property. The term includes | 24 | | mortgages and other liens on real property.
| 25 | | (33) "Equipment" means goods other than inventory, | 26 | | farm products, or
consumer goods.
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| 1 | | (34) "Farm products" means goods, other than standing | 2 | | timber, with
respect to which the debtor is engaged in a | 3 | | farming operation and which are:
| 4 | | (A) crops grown, growing, or to be grown, | 5 | | including:
| 6 | | (i) crops produced on trees, vines, and | 7 | | bushes; and
| 8 | | (ii) aquatic goods produced in aquacultural | 9 | | operations;
| 10 | | (B) livestock, born or unborn, including aquatic | 11 | | goods produced in
aquacultural operations;
| 12 | | (C) supplies used or produced in a farming | 13 | | operation; or
| 14 | | (D) products of crops or livestock in their | 15 | | unmanufactured states.
| 16 | | (35) "Farming operation" means raising, cultivating, | 17 | | propagating,
fattening, grazing, or any other farming, | 18 | | livestock, or aquacultural operation.
| 19 | | (36) "File number" means the number assigned to an | 20 | | initial financing
statement pursuant to Section 9-519(a).
| 21 | | (37) "Filing office" means an office designated in | 22 | | Section 9-501 as the
place to file a financing statement.
| 23 | | (38) "Filing-office rule" means a rule adopted | 24 | | pursuant to Section
9-526.
| 25 | | (39) "Financing statement" means a record or records | 26 | | composed of an
initial financing statement and any filed |
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| 1 | | record relating to the initial financing
statement.
| 2 | | (40) "Fixture filing" means the filing of a financing | 3 | | statement covering
goods that are or are to become fixtures | 4 | | and satisfying Section 9-502(a) and (b).
The term includes | 5 | | the filing of a financing statement covering goods of a
| 6 | | transmitting utility which are or are to become fixtures.
| 7 | | (41) "Fixtures" means goods that have become so related | 8 | | to particular
real property that an interest in them arises | 9 | | under real property law.
| 10 | | (42) "General intangible" means any personal property, | 11 | | including
things in action, other than accounts, chattel | 12 | | paper, commercial tort claims, deposit
accounts, | 13 | | documents, goods, instruments, investment property, | 14 | | letter-of-credit
rights, letters of credit, money, and | 15 | | oil, gas, or other minerals before extraction.
The term | 16 | | includes payment intangibles and software.
| 17 | | (43) "Good faith" means honesty in fact and the | 18 | | observance of
reasonable commercial standards of fair | 19 | | dealing.
| 20 | | (44) "Goods" means all things that are movable when a | 21 | | security interest
attaches. The term includes (i) | 22 | | fixtures, (ii) standing timber that is to be cut and
| 23 | | removed under a conveyance or contract for sale, (iii) the | 24 | | unborn young of animals,
(iv) crops grown, growing, or to | 25 | | be grown, even if the crops are produced on trees,
vines, | 26 | | or bushes, and (v) manufactured homes. The term also |
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| 1 | | includes a computer
program embedded in goods and any | 2 | | supporting information provided in
connection with a | 3 | | transaction relating to the program if (i) the program is
| 4 | | associated with the goods in such a manner that it | 5 | | customarily is considered part of
the goods, or (ii) by | 6 | | becoming the owner of the goods, a person acquires a right | 7 | | to
use the program in connection with the goods. The term | 8 | | does not include a
computer program embedded in goods that | 9 | | consist solely of the medium in which
the program is | 10 | | embedded. The term also does not include accounts, chattel | 11 | | paper,
commercial tort claims, deposit accounts, | 12 | | documents, general intangibles,
instruments, investment | 13 | | property, letter-of-credit rights, letters of credit, | 14 | | money, or
oil, gas, or other minerals before extraction.
| 15 | | (45) "Governmental unit" means a subdivision, agency, | 16 | | department,
county, parish, municipality, or other unit of | 17 | | the government of the United States, a
State, or a foreign | 18 | | country. The term includes an organization having a | 19 | | separate
corporate existence if the organization is | 20 | | eligible to issue debt on which interest is
exempt from | 21 | | income taxation under the laws of the United States.
| 22 | | (46) "Health-care-insurance receivable" means an | 23 | | interest in or claim
under a policy of insurance which is a | 24 | | right to payment of a monetary
obligation for
health-care | 25 | | goods or services provided.
| 26 | | (47) "Instrument" means a negotiable instrument or any |
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| 1 | | other writing
that evidences a right to the payment of a | 2 | | monetary obligation, is not itself a
security agreement or | 3 | | lease, and is of a type that in ordinary course of
business | 4 | | is
transferred by delivery with any necessary indorsement | 5 | | or assignment. The term
does not include (i) investment | 6 | | property, (ii) letters of credit,
(iii) nonnegotiable
| 7 | | certificates of deposit, (iv) uncertificated certificates | 8 | | of deposit, (v)
nontransferrable certificates of deposit, | 9 | | or (vi)
writings that
evidence a right to payment arising | 10 | | out of the use of a credit or charge card
or
information | 11 | | contained on or for use with the card.
| 12 | | (48) "Inventory" means goods, other than farm | 13 | | products, which:
| 14 | | (A) are leased by a person as lessor;
| 15 | | (B) are held by a person for sale or lease or to be | 16 | | furnished under a
contract of service;
| 17 | | (C) are furnished by a person under a contract of | 18 | | service; or
| 19 | | (D) consist of raw materials, work in process, or | 20 | | materials used or
consumed in a business.
| 21 | | (49) "Investment property" means a security, whether | 22 | | certificated or
uncertificated, security entitlement, | 23 | | securities account, commodity contract, or
commodity | 24 | | account.
| 25 | | (50) "Jurisdiction of organization", with respect to a | 26 | | registered
organization, means the jurisdiction under |
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| 1 | | whose law the organization is formed or organized.
| 2 | | (51) "Letter-of-credit right" means a right to payment | 3 | | or performance
under a letter of credit, whether or not the | 4 | | beneficiary has demanded or is at the
time entitled to | 5 | | demand payment or performance. The term does not include | 6 | | the
right of a beneficiary to demand payment or performance | 7 | | under a letter of credit.
| 8 | | (52) "Lien creditor" means:
| 9 | | (A) a creditor that has acquired a lien on the | 10 | | property involved by
attachment, levy, or the like;
| 11 | | (B) an assignee for benefit of creditors from the | 12 | | time of assignment;
| 13 | | (C) a trustee in bankruptcy from the date of the | 14 | | filing of the petition;
or
| 15 | | (D) a receiver in equity from the time of | 16 | | appointment.
| 17 | | (53) "Manufactured home" means a factory-assembled, | 18 | | completely integrated structure designed for permanent | 19 | | habitation, with a permanent chassis, and so constructed as | 20 | | to permit its transport, on wheels temporarily or | 21 | | permanently attached to its frame, and is a movable or | 22 | | portable unit that is (i) 8 body feet or more in width, | 23 | | (ii) 40 body feet or more in length, and (iii) 320 or more | 24 | | square feet, constructed to be towed on its own chassis | 25 | | (comprised of frame and wheels) from the place of its | 26 | | construction to the location, or subsequent locations, at |
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| 1 | | which it is installed and set up according to the | 2 | | manufacturer's instructions and connected to utilities for | 3 | | year-round occupancy for use as a permanent habitation, and | 4 | | designed and situated so as to permit its occupancy as a | 5 | | dwelling place for one or more persons. The term shall | 6 | | include units containing parts that may be folded, | 7 | | collapsed, or telescoped when being towed and that may be | 8 | | expected to provide additional cubic capacity, and that are | 9 | | designed to be joined into one integral unit capable of | 10 | | being separated again into the components for repeated | 11 | | towing. The term shall exclude campers and recreational | 12 | | vehicles.
| 13 | | (54) "Manufactured-home transaction" means a secured | 14 | | transaction:
| 15 | | (A) that creates a purchase-money security | 16 | | interest in a
manufactured home, other than a | 17 | | manufactured home held as inventory; or
| 18 | | (B) in which a manufactured home, other than a | 19 | | manufactured home
held as inventory, is the primary | 20 | | collateral.
| 21 | | (55) "Mortgage" means a consensual interest in real | 22 | | property, including
fixtures, which secures payment or | 23 | | performance of an obligation.
| 24 | | (56) "New debtor" means a person that becomes bound as | 25 | | debtor under
Section 9-203(d) by a security agreement | 26 | | previously entered into by another
person.
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| 1 | | (57) "New value" means (i) money, (ii) money's worth in | 2 | | property,
services, or new credit, or (iii) release by a | 3 | | transferee of an interest in property
previously | 4 | | transferred to the transferee. The term does not include an | 5 | | obligation
substituted for another obligation.
| 6 | | (58) "Noncash proceeds" means proceeds other than cash | 7 | | proceeds.
| 8 | | (59) "Obligor" means a person that, with respect to an | 9 | | obligation
secured by a security interest in or an | 10 | | agricultural lien on the collateral,
(i) owes
payment or | 11 | | other performance of the obligation, (ii) has provided | 12 | | property
other
than the collateral to secure payment or | 13 | | other performance of the obligation,
or (iii)
is otherwise | 14 | | accountable in whole or in part for payment or other | 15 | | performance
of
the obligation. The term does not include | 16 | | issuers or nominated persons under a
letter of credit.
| 17 | | (60) "Original debtor",
except as used in Section
| 18 | | 9-310(c), means
a person that, as debtor, entered into a
| 19 | | security agreement to which a new debtor has become bound | 20 | | under Section
9-203(d).
| 21 | | (61) "Payment intangible" means a general intangible | 22 | | under which the
account debtor's principal obligation is a | 23 | | monetary obligation.
| 24 | | (62) "Person related to", with respect to an | 25 | | individual, means:
| 26 | | (A) the spouse of the individual;
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| 1 | | (B) a brother, brother-in-law, sister, or | 2 | | sister-in-law of the
individual;
| 3 | | (C) an ancestor or lineal descendant of the | 4 | | individual or the
individual's spouse; or
| 5 | | (D) any other relative, by blood or marriage, of | 6 | | the individual or the
individual's spouse who shares | 7 | | the same home with the individual.
| 8 | | (63) "Person related to", with respect to an | 9 | | organization, means:
| 10 | | (A) a person directly or indirectly controlling, | 11 | | controlled by, or
under common control with the | 12 | | organization;
| 13 | | (B) an officer or director of, or a person | 14 | | performing similar
functions with respect to, the | 15 | | organization;
| 16 | | (C) an officer or director of, or a person | 17 | | performing similar
functions with respect to, a person | 18 | | described in subparagraph (A);
| 19 | | (D) the spouse of an individual described in | 20 | | subparagraph (A), (B),
or (C); or
| 21 | | (E) an individual who is related by blood or | 22 | | marriage to an
individual described in subparagraph | 23 | | (A), (B), (C), or (D) and shares the same
home with the | 24 | | individual.
| 25 | | (64) "Proceeds", except as used in Section
9-609(b), | 26 | | means
the following property:
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| 1 | | (A) whatever is acquired upon the sale, lease, | 2 | | license, exchange, or
other disposition of collateral;
| 3 | | (B) whatever is collected on, or distributed on | 4 | | account of, collateral;
| 5 | | (C) rights arising out of collateral;
| 6 | | (D) to the extent of the value of collateral, | 7 | | claims arising out of the
loss, nonconformity, or | 8 | | interference with the use of, defects or infringement
| 9 | | of
rights in, or damage to, the collateral; or
| 10 | | (E) to the extent of the value of collateral and to | 11 | | the extent payable
to the debtor or the secured party, | 12 | | insurance payable by reason of the loss or
| 13 | | nonconformity of, defects or infringement of rights | 14 | | in, or damage to, the
collateral.
| 15 | | (65) "Promissory note" means an instrument that | 16 | | evidences a promise
to pay a monetary obligation, does not | 17 | | evidence an order to pay, and does not
contain an | 18 | | acknowledgment by a bank that the bank has received for | 19 | | deposit a
sum
of money or funds.
| 20 | | (66) "Proposal" means a record authenticated by a | 21 | | secured party which
includes the terms on which the secured | 22 | | party is willing to accept collateral
in full
or partial | 23 | | satisfaction of the obligation it secures pursuant to | 24 | | Sections
9-620, 9-621,
and 9-622.
| 25 | | (67) "Public-finance transaction" means a secured | 26 | | transaction in
connection with which:
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| 1 | | (A) debt securities are issued;
| 2 | | (B) all or a portion of the securities issued have | 3 | | an initial stated
maturity of at least 20 years; and
| 4 | | (C) the debtor, obligor, secured party, account | 5 | | debtor or other person
obligated on collateral, | 6 | | assignor or assignee of a secured obligation, or
| 7 | | assignor or
assignee of a security interest is a State | 8 | | or a governmental unit of a State.
| 9 | | (68) "Public organic record" means a record that is | 10 | | available to the public for inspection and is: | 11 | | (A) a record consisting of the record initially | 12 | | filed with or issued by a State or the United States to | 13 | | form or organize an organization and any record filed | 14 | | with or issued by the State or the United States which | 15 | | amends or restates the initial record; | 16 | | (B) an organic record of a business trust | 17 | | consisting of the record initially filed with a State | 18 | | and any record filed with the State which amends or | 19 | | restates the initial record, if a statute of the State | 20 | | governing business trusts requires that the record be | 21 | | filed with the State; or | 22 | | (C) a record consisting of legislation enacted by | 23 | | the legislature of a State or the Congress of the | 24 | | United States which forms or organizes an | 25 | | organization, any record amending the legislation, and | 26 | | any record filed with or issued by the State or the |
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| 1 | | United States which amends or restates the name of the | 2 | | organization.
| 3 | | (69) (68) "Pursuant to commitment", with respect to an | 4 | | advance made or
other value given by a secured party, means | 5 | | pursuant to the secured party's
obligation, whether or not | 6 | | a subsequent event of default or other event not
within
the | 7 | | secured party's control has relieved or may relieve the | 8 | | secured party from
its
obligation.
| 9 | | (70) (69) "Record", except as used in "for record", "of | 10 | | record", "record or
legal title", and "record owner", means | 11 | | information that is inscribed on a
tangible
medium or which | 12 | | is stored in an electronic or other medium and is | 13 | | retrievable
in
perceivable form.
| 14 | | (71) (70) "Registered organization" means an | 15 | | organization formed or organized solely
under the law of a | 16 | | single State or the United States by the filing of a public | 17 | | organic record with, the issuance of a public organic | 18 | | record by, or the enactment of legislation by the State or | 19 | | the United States. The term includes a business trust that | 20 | | is formed or organized under the law of a single State if a | 21 | | statute of the State governing business trusts requires | 22 | | that the business trust's organic record be filed with the | 23 | | State and as to which the State
or the
United States must | 24 | | maintain a public record showing the organization to have
| 25 | | been
organized .
| 26 | | (72) (71) "Secondary obligor" means an obligor to the |
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| 1 | | extent that:
| 2 | | (A) the obligor's obligation is secondary; or
| 3 | | (B) the obligor has a right of recourse with | 4 | | respect to an obligation
secured by collateral against | 5 | | the debtor, another obligor, or property of
either.
| 6 | | (73) (72) "Secured party" means:
| 7 | | (A) a person in whose favor a security interest is | 8 | | created or provided
for under a security agreement, | 9 | | whether or not any obligation to be secured is
| 10 | | outstanding;
| 11 | | (B) a person that holds an agricultural lien;
| 12 | | (C) a consignor;
| 13 | | (D) a person to which accounts, chattel paper, | 14 | | payment intangibles,
or promissory notes have been | 15 | | sold;
| 16 | | (E) a trustee, indenture trustee, agent, | 17 | | collateral agent, or other
representative in whose | 18 | | favor a security interest or agricultural lien is
| 19 | | created or
provided for; or
| 20 | | (F) a person that holds a security interest arising | 21 | | under Section
2-401, 2-505, 2-711(3), 2A-508(5), | 22 | | 4-210, or 5-118.
| 23 | | (74) (73) "Security agreement" means an agreement that | 24 | | creates or provides
for a security interest.
| 25 | | (75) (74) "Send", in connection with a record or | 26 | | notification, means:
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| 1 | | (A) to deposit in the mail, deliver for | 2 | | transmission, or transmit by
any other usual means of | 3 | | communication, with postage or cost of transmission
| 4 | | provided for, addressed to any address reasonable | 5 | | under the circumstances; or
| 6 | | (B) to cause the record or notification to be | 7 | | received within the time
that it would have been | 8 | | received if properly sent under subparagraph (A).
| 9 | | (76) (75) "Software" means a computer program and any | 10 | | supporting
information provided in connection with a | 11 | | transaction relating to the program.
The
term does not | 12 | | include a computer program that is included in the | 13 | | definition of
goods.
| 14 | | (77) (76) "State" means a State of the United States, | 15 | | the District of
Columbia, Puerto Rico, the United States | 16 | | Virgin Islands, or any territory or
insular
possession | 17 | | subject to the jurisdiction of the United States.
| 18 | | (78) (77) "Supporting obligation" means a | 19 | | letter-of-credit right or secondary
obligation that | 20 | | supports the payment or performance of an account, chattel
| 21 | | paper, a
document, a general intangible, an instrument, or | 22 | | investment property.
| 23 | | (79) (78) "Tangible chattel paper" means chattel paper | 24 | | evidenced by a
record or records consisting of information | 25 | | that is inscribed on a tangible
medium.
| 26 | | (80) (79) "Termination statement" means an amendment |
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| 1 | | of a financing
statement which:
| 2 | | (A) identifies, by its file number, the initial | 3 | | financing statement to
which it relates; and
| 4 | | (B) indicates either that it is a termination | 5 | | statement or that the
identified financing statement | 6 | | is no longer effective.
| 7 | | (81) (80) "Transmitting utility" means a person | 8 | | primarily engaged in the
business of:
| 9 | | (A) operating a railroad, subway, street railway, | 10 | | or trolley bus;
| 11 | | (B) transmitting communications electrically, | 12 | | electromagnetically,
or by light;
| 13 | | (C) transmitting goods by pipeline or sewer; or
| 14 | | (D) transmitting or producing and transmitting | 15 | | electricity, steam,
gas, or water.
| 16 | | (b) Definitions in other Articles. "Control" as provided in | 17 | | Section 7-106 and the
following definitions in other
Articles | 18 | | apply to this Article:
| 19 | | "Applicant". Section 5-102.
| 20 | | "Beneficiary". Section 5-102.
| 21 | | "Broker". Section 8-102.
| 22 | | "Certificated security". Section 8-102.
| 23 | | "Check". Section 3-104.
| 24 | | "Clearing corporation". Section 8-102.
| 25 | | "Contract for sale". Section 2-106.
| 26 | | "Customer". Section 4-104.
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| 1 | | "Entitlement holder". Section 8-102.
| 2 | | "Financial asset". Section 8-102.
| 3 | | "Holder in due course". Section 3-302.
| 4 | | "Issuer" (with respect to a letter of
credit or | 5 | | letter-of-credit right). Section 5-102.
| 6 | | "Issuer" (with respect to a security). Section 8-201.
| 7 | | "Issuer" (with respect to documents of title). Section | 8 | | 7-102.
| 9 | | "Lease". Section 2A-103.
| 10 | | "Lease agreement". Section 2A-103.
| 11 | | "Lease contract". Section 2A-103.
| 12 | | "Leasehold interest". Section 2A-103.
| 13 | | "Lessee". Section 2A-103.
| 14 | | "Lessee in ordinary course of business". Section 2A-103.
| 15 | | "Lessor". Section 2A-103.
| 16 | | "Lessor's residual interest". Section 2A-103.
| 17 | | "Letter of credit". Section 5-102.
| 18 | | "Merchant". Section 2-104.
| 19 | | "Negotiable instrument". Section 3-104.
| 20 | | "Nominated person". Section 5-102.
| 21 | | "Note". Section 3-104.
| 22 | | "Proceeds of a letter of credit". Section 5-114.
| 23 | | "Prove". Section 3-103.
| 24 | | "Sale". Section 2-106.
| 25 | | "Securities account". Section 8-501.
| 26 | | "Securities intermediary". Section 8-102.
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| 1 | | "Security". Section 8-102.
| 2 | | "Security certificate". Section 8-102.
| 3 | | "Security entitlement". Section 8-102.
| 4 | | "Uncertificated security". Section 8-102.
| 5 | | (c) Article 1 definitions and principles. Article 1 | 6 | | contains general
definitions and principles of construction | 7 | | and interpretation applicable
throughout
this Article.
| 8 | | (Source: P.A. 95-895, eff. 1-1-09; 96-1477, eff. 1-1-11.)
| 9 | | (810 ILCS 5/9-105) (from Ch. 26, par. 9-105)
| 10 | | Sec. 9-105. Control of electronic chattel paper. | 11 | | (a) General rule: Control of electronic chattel paper. A | 12 | | secured party has
control
of electronic chattel paper if a | 13 | | system employed for evidencing the transfer of interests in the | 14 | | chattel paper reliably establishes the secured party as the | 15 | | person to which the chattel paper was assigned. | 16 | | (b) Specific facts giving control. A system satisfies | 17 | | subsection (a) if the record or records comprising the chattel
| 18 | | paper are
created, stored, and assigned in such a manner that:
| 19 | | (1) a single authoritative copy of the record or | 20 | | records exists which is
unique, identifiable and, except as | 21 | | otherwise provided in paragraphs (4), (5),
and
(6), | 22 | | unalterable;
| 23 | | (2) the authoritative copy identifies the secured | 24 | | party as the assignee of
the record or records;
| 25 | | (3) the authoritative copy is communicated to and |
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| 1 | | maintained by the
secured party or its designated | 2 | | custodian;
| 3 | | (4) copies or amendments revisions that add or change | 4 | | an identified assignee of the
authoritative copy can be | 5 | | made only with the consent participation of the secured
| 6 | | party;
| 7 | | (5) each copy of the authoritative copy and any copy of | 8 | | a copy is readily
identifiable as a copy that is not the | 9 | | authoritative copy; and
| 10 | | (6) any amendment revision of the authoritative copy is | 11 | | readily identifiable as an
authorized or unauthorized | 12 | | revision .
| 13 | | (Source: P.A. 90-665, eff. 7-30-98; 91-893, eff. 7-1-01.)
| 14 | | (810 ILCS 5/9-307) (from Ch. 26, par. 9-307)
| 15 | | Sec. 9-307. Location of debtor.
| 16 | | (a) "Place of business." In this Section, "place of | 17 | | business" means
a place where a debtor conducts its affairs.
| 18 | | (b) Debtor's location: general rules. Except as otherwise
| 19 | | provided in this Section, the following rules determine a | 20 | | debtor's location:
| 21 | | (1) A debtor who is an individual is located at the
| 22 | | individual's principal residence.
| 23 | | (2) A debtor that is an organization and has only one | 24 | | place
of business is located at its place of business.
| 25 | | (3) A debtor that is an organization and has more than |
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| 1 | | one
place of business is located at its chief executive | 2 | | office.
| 3 | | (c) Limitation of applicability of subsection (b). | 4 | | Subsection (b)
applies only if a debtor's residence, place of | 5 | | business, or chief executive
office, as applicable, is located | 6 | | in a jurisdiction whose law generally
requires information | 7 | | concerning the existence of a nonpossessory security
interest | 8 | | to be made generally available in a filing, recording, or | 9 | | registration
system as a condition or result of the security | 10 | | interest's obtaining priority
over the rights of a lien | 11 | | creditor with respect to the collateral. If
subsection (b) does | 12 | | not apply, the debtor is located in the District of
Columbia.
| 13 | | (d) Continuation of location: cessation of existence, etc. | 14 | | A person that
ceases to exist, have a residence, or have a | 15 | | place of business continues
to be located in the jurisdiction | 16 | | specified by subsections (b) and (c).
| 17 | | (e) Location of registered organization organized under | 18 | | State
law. A registered organization that is organized under | 19 | | the law of a State is
located in that State.
| 20 | | (f) Location of registered organization organized under | 21 | | federal law; bank
branches and agencies. Except as otherwise | 22 | | provided in subsection (i), a
registered organization that is | 23 | | organized under the law of the United States
and a branch or | 24 | | agency of a bank that is not organized under the law of the
| 25 | | United States or a State are located:
| 26 | | (1) in the State that the law of the United States |
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| 1 | | designates, if
the law designates a State of location;
| 2 | | (2) in the State that the registered organization, | 3 | | branch, or
agency designates, if the law of the United | 4 | | States authorizes the registered
organization, branch, or | 5 | | agency to designate its State of location , including by | 6 | | designating its main office, home office, or other | 7 | | comparable office ; or
| 8 | | (3) in the District of Columbia, if neither paragraph | 9 | | (1) nor
paragraph (2) applies.
| 10 | | (g) Continuation of location: change in status of | 11 | | registered organization.
A registered organization continues | 12 | | to be located in the jurisdiction specified
by subsection (e) | 13 | | or (f) notwithstanding:
| 14 | | (1) the suspension, revocation, forfeiture, or lapse | 15 | | of the registered
organization's status as such in its | 16 | | jurisdiction of organization; or
| 17 | | (2) the dissolution, winding up, or cancellation of the
| 18 | | existence of the registered organization.
| 19 | | (h) Location of United States. The United States is located | 20 | | in the
District of Columbia.
| 21 | | (i) Location of foreign bank branch or agency if licensed | 22 | | in only one
State. A branch or agency of a bank that is not | 23 | | organized under the law
of the United States or a State is | 24 | | located in the State in which the branch
or agency is licensed, | 25 | | if all branches and agencies of the bank are licensed
in only | 26 | | one State.
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| 1 | | (j) Location of foreign air carrier. A foreign air carrier | 2 | | under the
Federal Aviation Act of 1958, as amended, is located | 3 | | at the designated office
of the agent upon which service of | 4 | | process may be made on behalf of the
carrier.
| 5 | | (k) Section applies only to this Part. This Section applies | 6 | | only for
purposes of this Part.
| 7 | | (Source: P.A. 91-357, eff. 7-29-99; 91-893, eff. 7-1-01.)
| 8 | | (810 ILCS 5/9-311) (from Ch. 26, par. 9-311)
| 9 | | Sec. 9-311.
Perfection of security interests in property | 10 | | subject to
certain
statutes, regulations, and treaties.
| 11 | | (a) Security interest subject to other law. Except as | 12 | | otherwise
provided in subsection (d), the filing of a financing | 13 | | statement is not
necessary or
effective to perfect a security | 14 | | interest in property subject to:
| 15 | | (1) a statute, regulation, or treaty of the United | 16 | | States whose
requirements for a security interest's | 17 | | obtaining priority over the rights of a
lien
creditor with | 18 | | respect to the property preempt Section 9-310(a);
| 19 | | (2) the Illinois Vehicle Code or the Boat Registration | 20 | | and Safety Act;
or
| 21 | | (3) a certificate-of-title statute of another | 22 | | jurisdiction which
provides for a security interest to be | 23 | | indicated on a the certificate of title as a
condition or
| 24 | | result of the security interest's obtaining priority over | 25 | | the rights of a lien
creditor
with respect to the property.
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| 1 | | (b) Compliance with other law. Compliance with the
| 2 | | requirements of a statute, regulation, or treaty described in | 3 | | subsection (a)
for
obtaining priority over the rights of a lien | 4 | | creditor is equivalent to the
filing of a
financing statement | 5 | | under this Article. Except as otherwise provided in subsection
| 6 | | (d) and Sections 9-313 and 9-316(d) and (e) for goods covered | 7 | | by a certificate of
title, a security interest in property | 8 | | subject to a statute, regulation, or treaty
described in | 9 | | subsection (a) may be perfected only by compliance with those
| 10 | | requirements, and a security interest so perfected remains | 11 | | perfected
notwithstanding a change in the use or transfer of | 12 | | possession of the collateral.
| 13 | | (c) Duration and renewal of perfection. Except as otherwise
| 14 | | provided in subsection (d) and Section 9-316(d) and (e), | 15 | | duration and renewal
of
perfection of a security interest | 16 | | perfected by compliance with the requirements
prescribed by a | 17 | | statute, regulation, or treaty described in subsection (a) are
| 18 | | governed by the statute, regulation, or treaty. In other | 19 | | respects, the
security interest
is subject to this Article.
| 20 | | (d) Inapplicability to certain inventory. During any | 21 | | period in
which
collateral subject to a
statute specified in | 22 | | subsection (a)(2)
is inventory held for sale or lease by a | 23 | | person or leased by
that
person as lessor and that person is in | 24 | | the business of selling or leasing goods
of that
kind, this | 25 | | Section does not apply to a security interest in that | 26 | | collateral
created by
that person as debtor.
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| 1 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 2 | | (810 ILCS 5/9-316) (from Ch. 26, par. 9-316)
| 3 | | Sec. 9-316. Effect of Continued perfection of security | 4 | | interest following change
in governing law. | 5 | | (a) General rule: effect on perfection of change in | 6 | | governing
law. A security interest perfected pursuant to the | 7 | | law of the jurisdiction
designated
in Section 9-301(1) or | 8 | | 9-305(c) remains perfected until the earliest of:
| 9 | | (1) the time perfection would have ceased under the law | 10 | | of
that jurisdiction;
| 11 | | (2) the expiration of four months after a change of the
| 12 | | debtor's location to another jurisdiction; or
| 13 | | (3) the expiration of one year after a transfer of | 14 | | collateral to a
person that thereby becomes a debtor and is | 15 | | located in another jurisdiction.
| 16 | | (b) Security interest perfected or unperfected under law of | 17 | | new
jurisdiction. If a security interest described in | 18 | | subsection (a) becomes perfected
under the law of the other | 19 | | jurisdiction before the earliest time or event described in
| 20 | | that subsection, it remains perfected thereafter. If the | 21 | | security interest does not
become perfected under the law of | 22 | | the other jurisdiction before the earliest time or
event, it | 23 | | becomes unperfected and is deemed never to have been perfected | 24 | | as
against a purchaser of the collateral for value.
| 25 | | (c) Possessory security interest in collateral moved to new
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| 1 | | jurisdiction. A possessory security interest in collateral, | 2 | | other than goods covered
by a certificate of title and | 3 | | as-extracted collateral consisting of goods, remains
| 4 | | continuously perfected if:
| 5 | | (1) the collateral is located in one jurisdiction and | 6 | | subject to
a security interest perfected under the law of | 7 | | that jurisdiction;
| 8 | | (2) thereafter the collateral is brought into another
| 9 | | jurisdiction; and
| 10 | | (3) upon entry into the other jurisdiction, the | 11 | | security interest
is perfected under the law of the other | 12 | | jurisdiction.
| 13 | | (d) Goods covered by certificate of title from this State. | 14 | | Except
as otherwise provided in subsection (e), a security | 15 | | interest in goods covered by a
certificate of title which is | 16 | | perfected by any method under the law of another
jurisdiction | 17 | | when the goods become covered by a certificate of title from | 18 | | this State
remains perfected until the security interest would | 19 | | have become unperfected
under
the law of the other jurisdiction | 20 | | had the goods not become so covered.
| 21 | | (e) When subsection (d) security interest becomes | 22 | | unperfected
against purchasers. A security interest described | 23 | | in subsection (d) becomes
unperfected as against a purchaser of | 24 | | the goods for value and is deemed never
to
have been perfected | 25 | | as against a purchaser of the goods for value if the
applicable
| 26 | | requirements for perfection under Section 9-311(b) or 9-313 are |
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| 1 | | not satisfied
before
the earlier of:
| 2 | | (1) the time the security interest would have become
| 3 | | unperfected under the law of the other jurisdiction had the | 4 | | goods not become
covered by a certificate of title from | 5 | | this State; or
| 6 | | (2) the expiration of four months after the goods had | 7 | | become
so covered.
| 8 | | (f) Change in jurisdiction of bank, issuer, nominated | 9 | | person,
securities intermediary, or commodity intermediary. A | 10 | | security interest in
deposit accounts, letter-of-credit | 11 | | rights, or investment property which is perfected
under the law | 12 | | of the bank's jurisdiction, the issuer's jurisdiction, a | 13 | | nominated
person's jurisdiction, the securities intermediary's | 14 | | jurisdiction, or the commodity
intermediary's jurisdiction, as | 15 | | applicable, remains perfected until the earlier of:
| 16 | | (1) the time the security interest would have become
| 17 | | unperfected under the law of that jurisdiction; or
| 18 | | (2) the expiration of four months after a change of the
| 19 | | applicable jurisdiction to another jurisdiction.
| 20 | | (g) Subsection (f) security interest perfected or | 21 | | unperfected
under law of new jurisdiction. If a security | 22 | | interest described in subsection
(f)
becomes perfected under | 23 | | the law of the other jurisdiction before the earlier of
the
| 24 | | time or the end of the period described in that subsection, it | 25 | | remains
perfected
thereafter. If the security interest does not | 26 | | become perfected under the law
of the
other jurisdiction before |
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| 1 | | the earlier of that time or the end of that period,
it becomes
| 2 | | unperfected and is deemed never to have been perfected as | 3 | | against a purchaser
of
the collateral for value.
| 4 | | (h) Effect on filed financing statement of change in | 5 | | governing law. The following rules apply to collateral to which | 6 | | a security interest attaches within four months after the | 7 | | debtor changes its location to another jurisdiction: | 8 | | (1) A financing statement filed before the change | 9 | | pursuant to the law of the jurisdiction designated in | 10 | | Section 9-301(1) or 9-305(c) is effective to perfect a | 11 | | security interest in the collateral if the financing | 12 | | statement would have been effective to perfect a security | 13 | | interest in the collateral had the debtor not changed its | 14 | | location. | 15 | | (2) If a security interest perfected by a financing | 16 | | statement that is effective under paragraph (1) becomes | 17 | | perfected under the law of the other jurisdiction before | 18 | | the earlier of the time the financing statement would have | 19 | | become ineffective under the law of the jurisdiction | 20 | | designated in Section 9-301(1) or 9-305(c) or the | 21 | | expiration of the four-month period, it remains perfected | 22 | | thereafter. If the security interest does not become | 23 | | perfected under the law of the other jurisdiction before | 24 | | the earlier time or event, it becomes unperfected and is | 25 | | deemed never to have been perfected as against a purchaser | 26 | | of the collateral for value. |
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| 1 | | (i) Effect of change in governing law on financing | 2 | | statement filed against original debtor. If a financing | 3 | | statement naming an original debtor is filed pursuant to the | 4 | | law of the jurisdiction designated in Section 9-301(1) or | 5 | | 9-305(c) and the new debtor is located in another jurisdiction, | 6 | | the following rules apply: | 7 | | (1) The financing statement is effective to perfect a | 8 | | security interest in collateral acquired by the new debtor | 9 | | before, and within four months after, the new debtor | 10 | | becomes bound under Section 9-203(d), if the financing | 11 | | statement would have been effective to perfect a security | 12 | | interest in the collateral had the collateral been acquired | 13 | | by the original debtor. | 14 | | (2) A security interest perfected by the financing | 15 | | statement and which becomes perfected under the law of the | 16 | | other jurisdiction before the earlier of the time the | 17 | | financing statement would have become ineffective under | 18 | | the law of the jurisdiction designated in Section 9-301(1) | 19 | | or 9-305(c) or the expiration of the four-month period | 20 | | remains perfected thereafter. A security interest that is | 21 | | perfected by the financing statement but which does not | 22 | | become perfected under the law of the other jurisdiction | 23 | | before the earlier time or event becomes unperfected and is | 24 | | deemed never to have been perfected as against a purchaser | 25 | | of the collateral for value. | 26 | | (Source: P.A. 91-893, eff. 7-1-01.)
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| 1 | | (810 ILCS 5/9-317) (from Ch. 26, par. 9-317)
| 2 | | Sec. 9-317. Interests that take priority over or take free | 3 | | of
security interest or agricultural lien. | 4 | | (a) Conflicting security interests and rights of lien | 5 | | creditors. A
security interest or agricultural lien is | 6 | | subordinate to the rights
of:
| 7 | | (1) a person entitled to priority under Section 9-322; | 8 | | and
| 9 | | (2) except as otherwise provided in subsection (e) or | 10 | | (f), a person
that becomes a lien creditor before the | 11 | | earlier of the time:
| 12 | | (A) the security interest or agricultural lien is | 13 | | perfected; or
| 14 | | (B) one of the conditions specified in Section | 15 | | 9-203(b)(3) is met and a
financing statement covering | 16 | | the collateral is filed.
| 17 | | (b) Buyers that receive delivery. Except as otherwise | 18 | | provided in
subsection (e), a buyer, other than a secured | 19 | | party, of tangible chattel paper,
tangible documents, goods, | 20 | | instruments, or a certificated security security certificate | 21 | | takes free of a
security
interest or agricultural lien if the | 22 | | buyer gives value and receives delivery of
the
collateral | 23 | | without knowledge of the security interest or agricultural lien | 24 | | and
before
it is perfected.
| 25 | | (c) Lessees that receive delivery. Except as otherwise |
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| 1 | | provided in
subsection (e), a lessee of goods takes free of a | 2 | | security interest or agricultural lien
if the lessee gives | 3 | | value and receives delivery of the collateral without knowledge
| 4 | | of the security interest or agricultural lien and before it is | 5 | | perfected.
| 6 | | (d) Licensees and buyers of certain collateral. A licensee | 7 | | of a
general intangible or a buyer, other than a secured party, | 8 | | of collateral accounts, electronic
chattel paper, electronic | 9 | | documents,
general intangibles, or investment property other | 10 | | than tangible chattel paper, tangible documents, goods, | 11 | | instruments, or a certificated
security takes free of a | 12 | | security interest if the licensee or buyer gives value
without
| 13 | | knowledge of the security interest and before it is perfected.
| 14 | | (e) Purchase-money security interest. Except as otherwise
| 15 | | provided in Sections 9-320 and 9-321, if a person files a | 16 | | financing statement
with
respect to a purchase-money security | 17 | | interest before or within 20 days after
the
debtor receives | 18 | | delivery of the collateral, the security interest takes
| 19 | | priority over the
rights of a buyer, lessee, or lien creditor | 20 | | which arise between the time the
security
interest
attaches and | 21 | | the time of filing.
| 22 | | (f) Public deposits. An unperfected security interest | 23 | | shall take priority
over the rights of
a lien creditor if (i) | 24 | | the lien creditor is a trustee or receiver of a bank
or acting | 25 | | in furtherance of its
supervisory authority over such bank and | 26 | | (ii) a security interest is granted by
the bank to secure a |
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| 1 | | deposit of
public funds with the bank or a repurchase agreement
| 2 | | with the bank pursuant to the Government Securities
Act of | 3 | | 1986, as amended.
| 4 | | (Source: P.A. 95-895, eff. 1-1-09.)
| 5 | | (810 ILCS 5/9-326)
| 6 | | Sec. 9-326. Priority of security interests created by new | 7 | | debtor.
| 8 | | (a) Subordination of security interest created by new | 9 | | debtor.
Subject to subsection (b), a security interest that is | 10 | | created by a new debtor in collateral in which the new debtor | 11 | | has or acquires rights and is
perfected solely by a filed | 12 | | financing statement that would be ineffective to perfect the | 13 | | security interest but for the application of Section | 14 | | 9-316(i)(1) or 9-508 is effective solely under Section
9-508
in | 15 | | collateral in which a new debtor has or acquires rights is | 16 | | subordinate to a
security interest in the same collateral which | 17 | | is perfected other than by such a
filed
financing statement | 18 | | that is effective solely under Section 9-508 .
| 19 | | (b) Priority under other provisions; multiple original | 20 | | debtors.
The other provisions of this Part determine the | 21 | | priority among conflicting
security
interests in the same | 22 | | collateral perfected by filed financing statements described | 23 | | in subsection (a) that
are
effective solely under Section | 24 | | 9-508 . However, if the security agreements to
which
a new | 25 | | debtor became bound as debtor were not entered into by the same |
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| 1 | | original
debtor, the conflicting security interests rank | 2 | | according to priority in time
of the
new debtor's having become | 3 | | bound.
| 4 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 5 | | (810 ILCS 5/9-406) (from Ch. 26, par. 9-406)
| 6 | | Sec. 9-406.
Discharge of account debtor; notification of | 7 | | assignment;
identification and proof of assignment; | 8 | | restrictions on assignment of accounts,
chattel paper, payment | 9 | | intangibles, and promissory notes ineffective.
| 10 | | (a) Discharge of account debtor; effect of notification. | 11 | | Subject to
subsections (b) through (i), an account debtor on an | 12 | | account, chattel paper, or
a
payment intangible may discharge | 13 | | its obligation by paying the assignor until,
but
not after, the | 14 | | account debtor receives a notification, authenticated by the
| 15 | | assignor or
the assignee, that the amount due or to become due | 16 | | has been assigned and that
payment is to be made to the | 17 | | assignee. After receipt of the notification, the
account
debtor | 18 | | may discharge its obligation by paying the assignee and may not
| 19 | | discharge
the obligation by paying the assignor.
| 20 | | (b) When notification ineffective. Subject to subsection | 21 | | (h),
notification is ineffective under subsection (a):
| 22 | | (1) if it does not reasonably identify the rights | 23 | | assigned;
| 24 | | (2) to the extent that an agreement between an account
| 25 | | debtor and a seller of a payment intangible limits the |
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| 1 | | account debtor's duty to pay a
person other than the seller | 2 | | and the limitation is effective under law other than this
| 3 | | Article; or
| 4 | | (3) at the option of an account debtor, if the | 5 | | notification
notifies the account debtor to make less than | 6 | | the full amount of any installment or
other periodic | 7 | | payment to the assignee, even if:
| 8 | | (A) only a portion of the account, chattel paper, | 9 | | or
payment intangible has been assigned to that | 10 | | assignee;
| 11 | | (B) a portion has been assigned to another | 12 | | assignee;
or
| 13 | | (C) the account debtor knows that the assignment to
| 14 | | that assignee is limited.
| 15 | | (c) Proof of assignment. Subject to subsection (h), if | 16 | | requested by
the account debtor, an assignee shall seasonably | 17 | | furnish reasonable proof that
the
assignment has been made. | 18 | | Unless the assignee complies, the account debtor may
discharge | 19 | | its obligation by paying the assignor, even if the account | 20 | | debtor has
received a notification under subsection (a).
| 21 | | (d) Term restricting assignment generally ineffective. | 22 | | Except as
otherwise provided in subsection (e) and Sections | 23 | | 2A-303 and 9-407, and subject
to
subsection (h), a term in an | 24 | | agreement between an account debtor and an
assignor
or in a | 25 | | promissory note is ineffective to the extent that it:
| 26 | | (1) prohibits, restricts, or requires the consent of |
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| 1 | | the account
debtor or person obligated on the promissory | 2 | | note to the assignment or transfer
of,
or the creation, | 3 | | attachment, perfection, or enforcement of a security | 4 | | interest
in, the
account, chattel paper, payment | 5 | | intangible, or promissory note; or
| 6 | | (2) provides that
the assignment or transfer or
the
| 7 | | creation, attachment, perfection, or
enforcement of the | 8 | | security interest may give rise to a default, breach, right
| 9 | | of
recoupment, claim, defense, termination, right of | 10 | | termination, or remedy under
the
account, chattel paper, | 11 | | payment intangible, or promissory note.
| 12 | | (e) Inapplicability of subsection (d) to certain sales. | 13 | | Subsection
(d) does not apply to the sale of a payment | 14 | | intangible or promissory note , other than a sale pursuant to a | 15 | | disposition under Section 9-610 or an acceptance of collateral | 16 | | under Section 9-620 .
| 17 | | (f) Legal restrictions on assignment generally | 18 | | ineffective.
Except as otherwise provided in Sections 2A-303 | 19 | | and 9-407 and subject to
subsections (h) and (i), a rule of | 20 | | law, statute, or regulation that prohibits, restricts,
or | 21 | | requires the consent of a government, governmental body or | 22 | | official, or account
debtor to the assignment or transfer of, | 23 | | or creation of a security interest in, an
account or chattel | 24 | | paper is ineffective to the extent that the rule of law, | 25 | | statute, or
regulation:
| 26 | | (1) prohibits, restricts, or requires the consent of |
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| 1 | | the
government, governmental body or official, or account | 2 | | debtor to the assignment
or
transfer of, or the creation, | 3 | | attachment, perfection, or enforcement of a
security
| 4 | | interest in the account or chattel paper; or
| 5 | | (2) provides that the assignment or transfer or the | 6 | | creation, attachment,
perfection, or
enforcement of the | 7 | | security interest may give rise to a default, breach, right
| 8 | | of
recoupment, claim, defense, termination, right of | 9 | | termination, or remedy under
the
account or chattel paper.
| 10 | | (g) Subsection (b)(3) not waivable. Subject to subsection | 11 | | (h), an
account debtor may not waive or vary its option under | 12 | | subsection (b)(3).
| 13 | | (h) Rule for individual under other law. This Section is | 14 | | subject
to law other than this Article which establishes a | 15 | | different rule for an
account
debtor who is an individual and | 16 | | who incurred the obligation primarily for
personal,
family, or | 17 | | household purposes.
| 18 | | (i) Inapplicability to health-care-insurance receivable. | 19 | | This
Section does not apply to an assignment of a | 20 | | health-care-insurance
receivable.
| 21 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 22 | | (810 ILCS 5/9-408) (from Ch. 26, par. 9-408)
| 23 | | Sec. 9-408.
Restrictions on assignment of promissory | 24 | | notes,
health-care-insurance receivables, and certain general | 25 | | intangibles ineffective.
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| 1 | | (a) Term restricting assignment generally ineffective. | 2 | | Except as
otherwise provided in subsection (b), a term in a | 3 | | promissory note or in
an agreement between an account debtor | 4 | | and a debtor which relates to a
health-care-insurance | 5 | | receivable or a general intangible, including a
contract, | 6 | | permit, license, or franchise, and which term prohibits, | 7 | | restricts,
or requires the consent of the person obligated on | 8 | | the promissory note or the
account debtor to, the assignment or | 9 | | transfer of, or creation, attachment, or
perfection of a | 10 | | security interest in, the promissory note,
| 11 | | health-care-insurance receivable, or general intangible, is | 12 | | ineffective to the
extent that the term:
| 13 | | (1) would impair the creation, attachment, or | 14 | | perfection of a
security interest; or
| 15 | | (2) provides that the assignment or transfer or the | 16 | | creation, attachment,
or perfection of the security | 17 | | interest may give rise to a default, breach,
right of | 18 | | recoupment, claim, defense, termination, right of | 19 | | termination, or
remedy under the promissory note, | 20 | | health-care-insurance receivable, or general
intangible.
| 21 | | (b) Applicability of subsection (a) to sales of certain | 22 | | rights to payment.
Subsection (a) applies to a security | 23 | | interest in a payment intangible or
promissory note only if the | 24 | | security interest arises out of a sale of the
payment | 25 | | intangible or promissory note , other than a sale pursuant to a | 26 | | disposition under Section 9-610 or an acceptance of collateral |
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| 1 | | under Section 9-620 .
| 2 | | (c) Legal restrictions on assignment generally | 3 | | ineffective. A rule of law,
statute, or regulation that | 4 | | prohibits, restricts, or requires the consent of
a government, | 5 | | governmental body or official, person obligated on a promissory
| 6 | | note, or account debtor to the assignment or transfer of, or | 7 | | creation of a
security interest in, a promissory note, | 8 | | health-care-insurance receivable, or
general intangible, | 9 | | including a contract, permit, license, or franchise between
an | 10 | | account debtor and a debtor, is ineffective to the extent that | 11 | | the rule of
law, statute, or regulation:
| 12 | | (1) would impair the creation, attachment, or | 13 | | perfection of a security
interest; or
| 14 | | (2) provides that the assignment or transfer or the | 15 | | creation, attachment,
or perfection of the security | 16 | | interest may give rise to a default, breach,
right of | 17 | | recoupment, claim, defense, termination, right of | 18 | | termination, or
remedy under the promissory note, | 19 | | health-care-insurance receivable, or general
intangible.
| 20 | | (d) Limitation on ineffectiveness under subsections (a) | 21 | | and (c).
To the extent that a term in a promissory note or in an | 22 | | agreement between an
account debtor and a debtor which relates | 23 | | to a health-care-insurance receivable
or general intangible or | 24 | | a rule of law, statute, or regulation described in
subsection | 25 | | (c) would be effective under law other than this Article but is
| 26 | | ineffective under subsection (a) or (c), the creation, |
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| 1 | | attachment, or
perfection of a security interest in the | 2 | | promissory note, health-care-insurance
receivable, or general | 3 | | intangible:
| 4 | | (1) is not enforceable against the person obligated on | 5 | | the promissory
note or the account debtor;
| 6 | | (2) does not impose a duty or obligation on the person | 7 | | obligated on the
promissory note or the account debtor;
| 8 | | (3) does not require the person obligated on the | 9 | | promissory note or the
account debtor to recognize the | 10 | | security interest, pay or render performance
to the secured | 11 | | party, or accept payment or performance from the secured | 12 | | party;
| 13 | | (4) does not entitle the secured party to use or assign | 14 | | the debtor's
rights under the promissory note, | 15 | | health-care-insurance receivable, or general
intangible, | 16 | | including any related information or materials furnished | 17 | | to the
debtor in the transaction giving rise to the | 18 | | promissory note,
health-care-insurance receivable, or | 19 | | general intangible;
| 20 | | (5) does not entitle the secured party to use, assign, | 21 | | possess,
or have access to any trade secrets or | 22 | | confidential information of the person
obligated on the | 23 | | promissory note or the account debtor; and
| 24 | | (6) does not entitle the secured party to enforce the | 25 | | security interest in
the promissory note, | 26 | | health-care-insurance receivable, or general intangible.
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| 1 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 2 | | (810 ILCS 5/9-502) (from Ch. 26, par. 9-502)
| 3 | | Sec. 9-502.
Contents of financing statement; record of | 4 | | mortgage as
financing statement; time of filing financing | 5 | | statement.
| 6 | | (a) Sufficiency of financing statement. Subject to | 7 | | subsection (b),
a financing statement is sufficient only if it:
| 8 | | (1) provides the name of the debtor;
| 9 | | (2) provides the name of the secured party or a | 10 | | representative
of the secured party; and
| 11 | | (3) indicates the collateral covered by the financing
| 12 | | statement.
| 13 | | (b) Real-property-related financing statements. Except as
| 14 | | otherwise provided in Section 9-501(b), to be sufficient, a | 15 | | financing statement
that
covers as-extracted collateral or | 16 | | timber to be cut, or which is filed as a
fixture filing
and | 17 | | covers goods that are or are to become fixtures, must satisfy | 18 | | subsection (a) and
also:
| 19 | | (1) indicate that it covers this type of collateral;
| 20 | | (2) indicate that it is to be filed in the real
| 21 | | property records;
| 22 | | (3) provide a description of the real property to which | 23 | | the
collateral is related sufficient to give constructive | 24 | | notice of a mortgage
under the
law of this State if the | 25 | | description were contained in a record of the mortgage
of |
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| 1 | | the
real property; and
| 2 | | (4) if the debtor does not have an interest of record | 3 | | in the real
property, provide the name of a record owner.
| 4 | | (c) Record of mortgage as financing statement. A record of | 5 | | a
mortgage is effective, from the date of recording, as a | 6 | | financing statement
filed as a
fixture filing or as a financing | 7 | | statement covering as-extracted collateral or
timber
to be cut | 8 | | only if:
| 9 | | (1) the record indicates the goods or accounts that it | 10 | | covers;
| 11 | | (2) the goods are or are to become fixtures related to | 12 | | the real
property described in the record or the collateral | 13 | | is related to the real
property
described in the record and | 14 | | is as-extracted collateral or timber to be cut;
| 15 | | (3) the record satisfies the requirements for a | 16 | | financing
statement in this Section , but: | 17 | | (A) the record need not indicate other than an | 18 | | indication that it is to be filed in
the real
property | 19 | | records; and
| 20 | | (B) the record sufficiently provides the name of a | 21 | | debtor who is an individual if it provides the | 22 | | individual name of the debtor or the surname and first | 23 | | personal name of the debtor, even if the debtor is an | 24 | | individual to whom Section 9-503(a)(4) applies; and
| 25 | | (4) the record is recorded.
| 26 | | (d) Filing before security agreement or attachment. A |
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| 1 | | financing
statement may be filed before a security agreement is | 2 | | made or a security
interest
otherwise attaches.
| 3 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 4 | | (810 ILCS 5/9-503) (from Ch. 26, par. 9-503)
| 5 | | Sec. 9-503. Name of debtor and secured party.
| 6 | | (a) Sufficiency of debtor's name. A financing statement
| 7 | | sufficiently provides the name of the debtor:
| 8 | | (1) except as otherwise provided in paragraph (3), if | 9 | | the debtor is a registered organization or the collateral | 10 | | is held in a trust that is a registered organization , only | 11 | | if the
financing statement provides the name that is stated | 12 | | to be the registered organization's name of the debtor | 13 | | indicated on the public organic
record most recently filed | 14 | | with or issued or enacted by
of the registered | 15 | | organization's debtor's jurisdiction of organization which | 16 | | purports to state, amend, or restate the registered | 17 | | organization's name shows the debtor to have
been
| 18 | | organized ;
| 19 | | (2) subject to subsection (f), if the collateral is | 20 | | being administered by the personal representative of a | 21 | | decedent debtor is a decedent's estate , only if the | 22 | | financing
statement provides , as the name of the debtor, | 23 | | the name of the decedent and , in a separate part of the | 24 | | financing statement, indicates that the collateral is | 25 | | being administered by a personal representative debtor is |
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| 1 | | an
estate ;
| 2 | | (3) if the collateral is held in a trust that is not a | 3 | | registered organization debtor is a trust or a trustee | 4 | | acting with respect to
property held in trust , only if the | 5 | | financing statement:
| 6 | | (A) provides , as the name of the debtor: | 7 | | (i) if the organic record of the trust | 8 | | specifies a name for the trust, the name specified; | 9 | | or | 10 | | (ii) if the organic record of the trust does | 11 | | not specify a name for the trust, the name of the | 12 | | settlor or testator the name specified for the | 13 | | trust in its
organic documents or, if no name is | 14 | | specified, provides the name of the settlor and
| 15 | | additional information sufficient to distinguish | 16 | | the debtor from other trusts having
one or more of | 17 | | the same settlors ; and
| 18 | | (B) in a separate part of the financing statement: | 19 | | (i) if the name is provided in accordance with | 20 | | subparagraph (A)(i), indicates that the collateral | 21 | | is held in a trust; or | 22 | | (ii) if the name is provided in accordance with | 23 | | subparagraph (A)(ii), provides additional | 24 | | information sufficient to distinguish the trust | 25 | | from other trusts having one or more of the same | 26 | | settlors or the same testator and indicates that |
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| 1 | | the collateral is held in a trust, unless the | 2 | | additional information so indicates; | 3 | | (4) subject to subsection (g), if the debtor is an | 4 | | individual to whom this State has issued a driver's license | 5 | | that has not expired, only if the financing statement | 6 | | provides the name of the individual which is indicated on | 7 | | the driver's license; | 8 | | (5) if the debtor is an individual to whom paragraph | 9 | | (4) does not apply, only if the financing statement | 10 | | provides the individual name of the debtor or the surname | 11 | | and first personal name of the debtor indicates, in the | 12 | | debtor's name or otherwise, that
the debtor is a trust or | 13 | | is a trustee acting with respect to property held in trust ; | 14 | | and
| 15 | | (6) (4) in other cases:
| 16 | | (A) if the debtor has a name, only if the financing | 17 | | statement it provides the
individual or organizational | 18 | | name of the debtor; and
| 19 | | (B) if the debtor does not have a name, only if it
| 20 | | provides the names of the partners, members, | 21 | | associates, or other persons
comprising the debtor , in | 22 | | a manner that each name provided would be sufficient if | 23 | | the person named were the debtor .
| 24 | | (b) Additional debtor-related information. A financing | 25 | | statement
that provides the name of the debtor in accordance | 26 | | with subsection (a) is not
rendered ineffective by the absence |
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| 1 | | of:
| 2 | | (1) a trade name or other name of the debtor; or
| 3 | | (2) unless required under subsection (a)(6)(B) | 4 | | (a)(4)(B) , names of
partners, members, associates, or | 5 | | other persons comprising the debtor.
| 6 | | (c) Debtor's trade name insufficient. A financing | 7 | | statement that
provides only the debtor's trade name does not | 8 | | sufficiently provide the name of the
debtor.
| 9 | | (d) Representative capacity. Failure to indicate the | 10 | | representative
capacity of a secured party or representative of | 11 | | a secured party does not affect the
sufficiency of a financing | 12 | | statement.
| 13 | | (e) Multiple debtors and secured parties. A financing | 14 | | statement
may provide the name of more than one debtor and the | 15 | | name of more than one
secured party.
| 16 | | (f) Name of decedent. The name of the decedent indicated on | 17 | | the order appointing the personal representative of the | 18 | | decedent issued by the court having jurisdiction over the | 19 | | collateral is sufficient as the "name of the decedent" under | 20 | | subsection (a)(2). | 21 | | (g) Multiple driver's licenses. If this State has issued to | 22 | | an individual more than one driver's license of a kind | 23 | | described in subsection (a)(4), the one that was issued most | 24 | | recently is the one to which subsection (a)(4) refers. | 25 | | (h) Definition. In this Section, the "name of the settlor | 26 | | or testator" means: |
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| 1 | | (1) if the settlor is a registered organization, the | 2 | | name that is stated to be the settlor's name on the public | 3 | | organic record most recently filed with or issued or | 4 | | enacted by the settlor's jurisdiction of organization | 5 | | which purports to state, amend, or restate the settlor's | 6 | | name; or | 7 | | (2) in other cases, the name of the settlor or testator | 8 | | indicated in the trust's organic record. | 9 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 10 | | (810 ILCS 5/9-507) (from Ch. 26, par. 9-507)
| 11 | | Sec. 9-507.
Effect of certain events on effectiveness of | 12 | | financing
statement.
| 13 | | (a) Disposition. A filed financing statement remains | 14 | | effective with
respect to collateral that is sold, exchanged, | 15 | | leased, licensed, or otherwise
disposed
of and in which a | 16 | | security interest or agricultural lien continues, even if the
| 17 | | secured
party knows of or consents to the disposition.
| 18 | | (b) Information becoming seriously misleading. Except as
| 19 | | otherwise provided in subsection (c) and Section 9-508, a | 20 | | financing statement
is not
rendered ineffective if, after the | 21 | | financing statement is filed, the
information
provided in the | 22 | | financing statement becomes seriously misleading under Section
| 23 | | 9-506.
| 24 | | (c) Change in debtor's name. If the a debtor so changes its | 25 | | name that
a filed financing statement provides for a debtor |
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| 1 | | becomes insufficient as the name of the debtor under Section | 2 | | 9-503(a) so that the financing statement becomes seriously | 3 | | misleading under Section 9-506:
| 4 | | (1) the financing statement is effective to perfect a | 5 | | security
interest in collateral acquired by the debtor | 6 | | before, or within four months
after, the filed financing | 7 | | statement becomes seriously misleading
change ; and
| 8 | | (2) the financing statement is not effective to perfect | 9 | | a
security interest in collateral acquired by the debtor | 10 | | more than four months
after the filed financing statement | 11 | | becomes seriously misleading
change , unless an amendment | 12 | | to the financing statement which renders the
financing | 13 | | statement not seriously misleading is filed within four | 14 | | months after
the filed financing statement becomes | 15 | | seriously misleading
change .
| 16 | | (Source: P.A. 90-214, eff. 7-25-97; 91-893, eff. 7-1-01.)
| 17 | | (810 ILCS 5/9-515)
| 18 | | Sec. 9-515.
Duration and effectiveness of financing | 19 | | statement; effect of
lapsed financing statement.
| 20 | | (a) Five-year effectiveness. Except as otherwise provided | 21 | | in
subsections (b), (e), (f), and (g), a filed financing | 22 | | statement is effective
for a period
of five years after the | 23 | | date of filing.
| 24 | | (b) Public-finance or manufactured-home transaction. | 25 | | Except
as otherwise provided in subsections (e), (f), and (g), |
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| 1 | | an initial financing
statement
filed in connection with a | 2 | | public-finance transaction or manufactured-home
transaction is | 3 | | effective for a period of 30 years after the date of filing if | 4 | | it indicates
that it is filed in connection with a | 5 | | public-finance transaction or
manufactured-home transaction.
| 6 | | (c) Lapse and continuation of financing statement. The
| 7 | | effectiveness of a filed financing statement lapses on the | 8 | | expiration of the period of
its effectiveness unless before the | 9 | | lapse a continuation statement is filed pursuant to
subsection | 10 | | (d). Upon lapse, a financing statement ceases to be effective | 11 | | and any
security interest or agricultural lien that was | 12 | | perfected by the financing statement
becomes unperfected, | 13 | | unless the security interest is perfected otherwise. If the
| 14 | | security interest or agricultural lien becomes unperfected | 15 | | upon lapse, it is deemed
never to have been perfected as | 16 | | against a purchaser of the collateral for value.
| 17 | | (d) When continuation statement may be filed. A | 18 | | continuation
statement may be filed only within six months | 19 | | before the expiration of the five-year
period specified in | 20 | | subsection (a) or the 30-year period specified in subsection | 21 | | (b),
whichever is applicable.
| 22 | | (e) Effect of filing continuation statement. Except as | 23 | | otherwise
provided in Section 9-510, upon timely filing of a | 24 | | continuation statement, the
effectiveness of the initial | 25 | | financing statement continues for a period of five years
| 26 | | commencing on the day on which the financing statement would |
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| 1 | | have become
ineffective in the absence of the filing. Upon the | 2 | | expiration of the five-year period,
the financing statement | 3 | | lapses in the same manner as provided in subsection (c),
| 4 | | unless, before the lapse, another continuation statement is | 5 | | filed pursuant to
subsection (d). Succeeding continuation | 6 | | statements may be filed in the same
manner to continue the | 7 | | effectiveness of the initial financing statement.
| 8 | | (f) Transmitting utility financing statement. If a debtor | 9 | | is a
transmitting utility and a filed initial financing | 10 | | statement so indicates, the financing
statement is effective | 11 | | until a termination statement is filed.
| 12 | | (g) Record of mortgage as financing statement. A record of | 13 | | a
mortgage that is effective as a financing statement filed as | 14 | | a fixture filing under
Section 9-502(c) remains effective as a | 15 | | financing statement filed as a fixture
filing
until the | 16 | | mortgage is released or satisfied of record or its | 17 | | effectiveness
otherwise
terminates as to the real property.
| 18 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 19 | | (810 ILCS 5/9-516)
| 20 | | Sec. 9-516. What constitutes filing; effectiveness of | 21 | | filing.
| 22 | | (a) What constitutes filing. Except as otherwise provided | 23 | | in
subsection (b), communication of a record to a filing office | 24 | | and tender of the
filing
fee or acceptance of the record by the | 25 | | filing office constitutes filing.
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| 1 | | (b) Refusal to accept record; filing does not occur. Filing | 2 | | does
not occur with respect to a record that a filing office | 3 | | refuses to accept
because:
| 4 | | (1) the record is not communicated by a method or | 5 | | medium
of communication authorized by the filing office;
| 6 | | (2) an amount equal to or greater than the applicable | 7 | | filing
fee is not tendered;
| 8 | | (3) the filing office is unable to index the record | 9 | | because:
| 10 | | (A) in the case of an initial financing statement, | 11 | | the
record does not provide a name for the debtor;
| 12 | | (B) in the case of an amendment or information | 13 | | correction
statement, the record:
| 14 | | (i) does not identify the initial financing
| 15 | | statement as required by Section 9-512 or 9-518, as | 16 | | applicable; or
| 17 | | (ii) identifies an initial financing statement
| 18 | | whose effectiveness has lapsed under Section | 19 | | 9-515;
| 20 | | (C) in the case of an initial financing statement | 21 | | that
provides the name of a debtor identified as an | 22 | | individual or an amendment that
provides a name of a | 23 | | debtor identified as an individual which was not | 24 | | previously
provided in the financing statement to | 25 | | which the record relates, the record does not
identify | 26 | | the debtor's surname last name ;
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| 1 | | (D) in the case of a record filed or recorded in | 2 | | the
filing office described in Section 9-501(a)(1), | 3 | | the record does not provide a
sufficient description of | 4 | | the real property to which it relates; or
| 5 | | (E) in the case of a record submitted to the filing | 6 | | office described in Section 9-501(b), the debtor does | 7 | | not meet the definition of a transmitting utility as | 8 | | described in Section 9-102(a)(80); | 9 | | (3.5) in the case of an initial financing statement or | 10 | | an amendment, if the filing office believes in good faith | 11 | | that a document submitted for filing is being filed for the | 12 | | purpose of defrauding any person or harassing any person in | 13 | | the performance of duties as a public servant;
| 14 | | (4) in the case of an initial financing statement or an
| 15 | | amendment that adds a secured party of record, the record | 16 | | does not provide a
name
and mailing address for the secured | 17 | | party of record;
| 18 | | (5) in the case of an initial financing statement or an
| 19 | | amendment that provides a name of a debtor which was not | 20 | | previously provided in
the financing statement to which the | 21 | | amendment relates, the record does not:
| 22 | | (A) provide a mailing address for the debtor; or
| 23 | | (B) indicate whether the name provided as the name | 24 | | of the debtor is the name of an individual or an
| 25 | | organization; or
| 26 | | (C) if the financing statement indicates that the
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| 1 | | debtor is an organization, provide:
| 2 | | (i) a type of organization for the debtor;
| 3 | | (ii) a jurisdiction of organization for the
| 4 | | debtor; or
| 5 | | (iii) an organizational identification number
| 6 | | for the debtor or indicate that the debtor has | 7 | | none;
| 8 | | (6) in the case of an assignment reflected in an | 9 | | initial
financing statement under Section 9-514(a) or an | 10 | | amendment filed under Section
9-514(b), the record does not | 11 | | provide a name and mailing address for the assignee;
or
| 12 | | (7) in the case of a continuation statement, the record | 13 | | is not
filed within the six-month period prescribed by | 14 | | Section 9-515(d).
| 15 | | (c) Rules applicable to subsection (b). For purposes of | 16 | | subsection
(b):
| 17 | | (1) a record does not provide information if the filing | 18 | | office
is unable to read or decipher the information; and
| 19 | | (2) a record that does not indicate that it is an | 20 | | amendment or
identify an initial financing statement to | 21 | | which it relates, as required by
Section
9-512, 9-514, or | 22 | | 9-518, is an initial financing statement.
| 23 | | (d) Refusal to accept record; record effective as filed | 24 | | record. A
record that is communicated to the filing office with | 25 | | tender of the filing fee,
but
which the filing office refuses | 26 | | to accept for a reason other than one set forth
in
subsection |
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| 1 | | (b), is effective as a filed record except as against a | 2 | | purchaser of
the
collateral which gives value in reasonable | 3 | | reliance upon the absence of the
record
from the files.
| 4 | | (e) The Secretary of State may refuse to accept a record | 5 | | for filing under subdivision (b)(3)(E) or (b)(3.5) only if the | 6 | | refusal is approved by the Department of Business Services of | 7 | | the Secretary of State and the General Counsel to the Secretary | 8 | | of State.
| 9 | | (Source: P.A. 95-446, eff. 1-1-08.)
| 10 | | (810 ILCS 5/9-518)
| 11 | | Sec. 9-518. Claim concerning inaccurate or wrongfully | 12 | | filed record.
| 13 | | (a) Statement with respect to record indexed under a | 14 | | person's name Correction statement . A person may file in the | 15 | | filing office an information a
correction statement with | 16 | | respect to a record indexed there under the person's
name
if | 17 | | the person believes that the record is inaccurate or was | 18 | | wrongfully filed.
| 19 | | (b) Contents Sufficiency of correction statement under | 20 | | subsection (a) . An information A correction statement under | 21 | | subsection (a)
must:
| 22 | | (1) identify the record to which it relates by :
(A) the | 23 | | file number
assigned to the initial financing statement to | 24 | | which the record relates; and
| 25 | | (B) if the correction statement relates to a record |
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| 1 | | filed or recorded in
a filing office described in | 2 | | Section 9-501(a)(1), the date and time that the
initial | 3 | | financing
statement was filed and the information | 4 | | specified in Section 9-502(b);
| 5 | | (2) indicate that it is an information a correction | 6 | | statement; and
| 7 | | (3) provide the basis for the person's belief that the | 8 | | record is
inaccurate and indicate the manner in which the | 9 | | person believes the record
should
be amended to cure any | 10 | | inaccuracy or provide the basis for the person's belief
| 11 | | that
the record was wrongfully filed.
| 12 | | (c) Statement by secured party of record. A person may file | 13 | | in the filing office an information statement with respect to a | 14 | | record filed there if the person is a secured party of record | 15 | | with respect to the financing statement to which the record | 16 | | relates and believes that the person that filed the record was | 17 | | not entitled to do so under Section 9-509(d). | 18 | | (d) Contents of statement under subsection (c). An | 19 | | information statement under subsection (c) must: | 20 | | (1) identify the record to which it relates by the file | 21 | | number assigned to the initial financing statement to which | 22 | | the record relates; | 23 | | (2) indicate that it is an information statement; and | 24 | | (3) provide the basis for the person's belief that the | 25 | | person that filed the record was not entitled to do so | 26 | | under Section 9-509(d). |
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| 1 | | (e) (c) Record not affected by information correction | 2 | | statement. The filing of an information a
correction statement | 3 | | does not affect the effectiveness of an initial financing
| 4 | | statement or other filed record.
| 5 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 6 | | (810 ILCS 5/9-521)
| 7 | | Sec. 9-521.
Uniform form of written financing statement and
| 8 | | amendment.
| 9 | | (a) Initial financing statement form. A filing office that | 10 | | accepts
written records may not refuse to accept a
written | 11 | | initial financing statement
in the
form and format
set forth in | 12 | | the final official text of the 2010 amendments 1999 revisions | 13 | | to Article 9 of the
Uniform Commercial Code
promulgated by the | 14 | | American Law Institute and the National Conference of
| 15 | | Commissioners on Uniform State Laws,
except for a reason set | 16 | | forth in Section
9-516(b).
| 17 | | (b) Amendment form. A filing office that accepts written | 18 | | records may not
refuse
to accept a written record in
the form | 19 | | and format
set forth as Form UCC3 and Form UCC3Ad in the final | 20 | | official text of the 2010 amendments 1999 revisions to Article | 21 | | 9 of the
Uniform Commercial Code
promulgated by the American | 22 | | Law Institute and the National Conference of
Commissioners on | 23 | | Uniform State Laws, except for a
reason
set
forth in Section | 24 | | 9-516(b).
| 25 | | (Source: P.A. 91-893, eff. 7-1-01.)
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| 1 | | (810 ILCS 5/9-607)
| 2 | | Sec. 9-607. Collection and enforcement by secured party.
| 3 | | (a) Collection and enforcement generally. If so agreed, and | 4 | | in
any event after default, a secured party:
| 5 | | (1) may notify an account debtor or other person | 6 | | obligated
on collateral to make payment or otherwise render | 7 | | performance to or for the
benefit
of the secured party;
| 8 | | (2) may take any proceeds to which the secured party is
| 9 | | entitled under Section 9-315;
| 10 | | (3) may enforce the obligations of an account debtor or | 11 | | other
person obligated on collateral and exercise the | 12 | | rights of the debtor with respect to
the obligation of the | 13 | | account debtor or other person obligated on collateral to | 14 | | make
payment or otherwise render performance to the debtor, | 15 | | and with respect to any
property that secures the | 16 | | obligations of the account debtor or other person obligated
| 17 | | on the collateral;
| 18 | | (4) if it holds a security interest in a deposit | 19 | | account
perfected by control under Section 9-104(a)(1), | 20 | | may apply the balance of the
deposit account to the | 21 | | obligation secured by the deposit account; and
| 22 | | (5) if it holds a security interest in a deposit | 23 | | account
perfected by control under Section 9-104(a)(2) or | 24 | | (3), may instruct the bank to pay
the balance of the | 25 | | deposit account to or for the benefit of the secured party.
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| 1 | | (b) Nonjudicial enforcement of mortgage. If necessary to | 2 | | enable
a secured party to exercise under subsection (a)(3) the | 3 | | right of a debtor to enforce a
mortgage nonjudicially, the | 4 | | secured party may record in the office in which a
record of the | 5 | | mortgage is recorded:
| 6 | | (1) a copy of the security agreement that creates or | 7 | | provides
for a security interest in the obligation secured | 8 | | by the mortgage; and
| 9 | | (2) the secured party's sworn affidavit in recordable | 10 | | form
stating that:
| 11 | | (A) a default has occurred with respect to the | 12 | | obligation secured by the mortgage ; and
| 13 | | (B) the secured party is entitled to enforce the
| 14 | | mortgage nonjudicially.
| 15 | | (c) Commercially reasonable collection and enforcement. A
| 16 | | secured party shall proceed in a commercially reasonable manner | 17 | | if the secured
party:
| 18 | | (1) undertakes to collect from or enforce an obligation | 19 | | of an
account debtor or other person obligated on | 20 | | collateral; and
| 21 | | (2) is entitled to charge back uncollected collateral | 22 | | or
otherwise to full or limited recourse against the debtor | 23 | | or a secondary obligor.
| 24 | | (d) Expenses of collection and enforcement. A secured party | 25 | | may
deduct from the collections made pursuant to subsection (c) | 26 | | reasonable expenses of
collection and enforcement, including |
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| 1 | | reasonable attorney's fees and legal
expenses
incurred by the | 2 | | secured party.
| 3 | | (e) Duties to secured party not affected. This Section does | 4 | | not
determine whether an account debtor, bank, or other person | 5 | | obligated on
collateral
owes a duty to a secured party.
| 6 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 7 | | (810 ILCS 5/9-625)
| 8 | | Sec. 9-625. Remedies for secured party's failure to comply | 9 | | with Article.
| 10 | | (a) Judicial orders concerning noncompliance. If it is | 11 | | established
that a secured party is not proceeding in | 12 | | accordance with this Article, a court
may
order or restrain | 13 | | collection, enforcement, or disposition of collateral on
| 14 | | appropriate
terms and conditions.
| 15 | | (b) Damages for noncompliance. Subject to subsections (c), | 16 | | (d),
and (f), a person is liable for damages in the amount of | 17 | | any loss caused by a
failure
to comply with this Article. Loss | 18 | | caused by a failure to comply with a request
under Section | 19 | | 9-210 may include loss resulting from the debtor's inability to
| 20 | | obtain, or increased costs of, alternative financing.
| 21 | | (c) Persons entitled to recover damages; statutory damages | 22 | | if collateral is consumer goods in
consumer-goods transaction . | 23 | | Except as otherwise provided in Section 9-628:
| 24 | | (1) a person that, at the time of the failure, was a | 25 | | debtor, was
an obligor, or held a security interest in or |
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| 1 | | other lien on the collateral may
recover in an individual | 2 | | action
damages under subsection (b) for its loss; and
| 3 | | (2) if the collateral is consumer goods, a person that | 4 | | was a
debtor or a secondary obligor at the time a secured | 5 | | party failed to comply with
this
Part may recover in an | 6 | | individual action for that failure in any event an
amount | 7 | | not less than the credit
service charge plus 10 percent of | 8 | | the principal amount of the obligation or the
time-price | 9 | | differential plus 10 percent of the cash price.
| 10 | | (d) Recovery when deficiency eliminated or reduced. A | 11 | | debtor
whose deficiency is eliminated under Section 9-626 may | 12 | | recover damages for the
loss of any surplus. However, a debtor | 13 | | or secondary obligor whose deficiency
is
eliminated or reduced | 14 | | under Section 9-626 may not otherwise recover under
subsection | 15 | | (b) for noncompliance with the provisions of this Part relating | 16 | | to
collection, enforcement, disposition, or acceptance.
| 17 | | (e) Statutory damages: noncompliance with specified
| 18 | | provisions. In addition to any damages recoverable under | 19 | | subsection (b), the
debtor, consumer obligor, or person named | 20 | | as a debtor in a filed record, as
applicable, may recover in an | 21 | | individual action $500 for each instance that a
person:
| 22 | | (1) fails to comply with Section 9-208;
| 23 | | (2) fails to comply with Section 9-209;
| 24 | | (3) files a record that the person is not entitled to | 25 | | file under
Section 9-509(a); or
| 26 | | (4) fails to cause the secured party of record to file |
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| 1 | | or send a
termination statement as required by Section | 2 | | 9-513(a) or (c).
| 3 | | (f) Statutory damages: noncompliance with Section 9-210. A
| 4 | | debtor or consumer obligor may recover damages under subsection | 5 | | (b) and, in
addition, may in an individual action recover $500 | 6 | | in each case from a person
that, without reasonable cause, | 7 | | fails
to
comply with a request under Section 9-210. A recipient | 8 | | of a request under
Section
9-210 which never claimed an | 9 | | interest in the collateral or obligations that are
the
subject | 10 | | of a request under that Section has a reasonable excuse for | 11 | | failure to
comply
with the request within the meaning of this | 12 | | subsection.
| 13 | | (g) Limitation of security interest: noncompliance with | 14 | | Section
9-210. If a secured party fails to comply with a | 15 | | request regarding a list of
collateral
or a statement of | 16 | | account under Section 9-210, the secured party may claim a
| 17 | | security interest only as shown in the statement included in | 18 | | the request as
against a
person that is reasonably misled by | 19 | | the failure.
| 20 | | (Source: P.A. 91-893, eff. 7-1-01.)
| 21 | | (810 ILCS 5/Art. 9 Pt. 8 heading new) | 22 | | PART 8. TRANSITION PROVISIONS FOR 2010 AMENDMENTS | 23 | | (810 ILCS 5/9-801 new) | 24 | | Sec. 9-801. Effective date. (See Section 99 of the Public |
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| 1 | | Act adding this Section to this Act.) | 2 | | (810 ILCS 5/9-802 new) | 3 | | Sec. 9-802. Savings clause. | 4 | | (a) Pre-effective-date transactions or liens. Except as | 5 | | otherwise provided in this Part, this Act applies to a | 6 | | transaction or lien within its scope, even if the transaction | 7 | | or lien was entered into or created before the effective date | 8 | | of this amendatory Act of the 97th General Assembly. | 9 | | (b) Pre-effective-date proceedings. This amendatory Act of | 10 | | the 97th General Assembly does not affect an action, case, or | 11 | | proceeding commenced before the effective date of this | 12 | | amendatory Act of the 97th General Assembly. | 13 | | (810 ILCS 5/9-803 new) | 14 | | Sec. 9-803. Security interest perfected before effective | 15 | | date. | 16 | | (a) Continuing perfection: perfection requirements | 17 | | satisfied. A security interest that is a perfected security | 18 | | interest immediately before the effective date of this | 19 | | amendatory Act of the 97th General Assembly is a perfected | 20 | | security interest under Article 9 as amended by this amendatory | 21 | | Act of the 97th General Assembly if, on the effective date of | 22 | | this amendatory Act of the 97th General Assembly, the | 23 | | applicable requirements for attachment and perfection under | 24 | | Article 9 as amended by this amendatory Act of the 97th General |
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| 1 | | Assembly are satisfied without further action. | 2 | | (b) Continuing perfection: perfection requirements not | 3 | | satisfied. Except as otherwise provided in Section 9-805, if, | 4 | | immediately before the effective date of this amendatory Act of | 5 | | the 97th General Assembly, a security interest is a perfected | 6 | | security interest, but the applicable requirements for | 7 | | perfection under Article 9 as amended by this amendatory Act of | 8 | | the 97th General Assembly are not satisfied when this | 9 | | amendatory Act of the 97th General Assembly takes effect, the | 10 | | security interest remains perfected thereafter only if the | 11 | | applicable requirements for perfection under Article 9 as | 12 | | amended by this amendatory Act of the 97th General Assembly are | 13 | | satisfied within one year after the effective date of this | 14 | | amendatory Act of the 97th General Assembly. | 15 | | (810 ILCS 5/9-804 new) | 16 | | Sec. 9-804. Security interest unperfected before the | 17 | | effective date of this amendatory Act of the 97th General | 18 | | Assembly. A security interest that is an unperfected security | 19 | | interest immediately before the effective date of this | 20 | | amendatory Act of the 97th General Assembly becomes a perfected | 21 | | security interest: | 22 | | (1) without further action, when this amendatory Act of | 23 | | the 97th General Assembly takes effect if the applicable | 24 | | requirements for perfection under Article 9 as amended by | 25 | | this amendatory Act of the 97th General Assembly are |
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| 1 | | satisfied before or at that time; or | 2 | | (2) when the applicable requirements for perfection | 3 | | are satisfied if the requirements are satisfied after that | 4 | | time. | 5 | | (810 ILCS 5/9-805 new) | 6 | | Sec. 9-805. Effectiveness of action taken before the | 7 | | effective date of this amendatory Act of the 97th General | 8 | | Assembly. | 9 | | (a) Pre-effective-date filing effective. The filing of a | 10 | | financing statement before the effective date of this | 11 | | amendatory Act of the 97th General Assembly is effective to | 12 | | perfect a security interest to the extent the filing would | 13 | | satisfy the applicable requirements for perfection under | 14 | | Article 9 as amended by this amendatory Act of the 97th General | 15 | | Assembly. | 16 | | (b) When pre-effective-date filing becomes ineffective. | 17 | | This amendatory Act of the 97th General Assembly does not | 18 | | render ineffective an effective financing statement that, | 19 | | before the effective date of this amendatory Act of the 97th | 20 | | General Assembly, is filed and satisfies the applicable | 21 | | requirements for perfection under the law of the jurisdiction | 22 | | governing perfection as provided in Article 9 as it existed | 23 | | before the effective date of this amendatory Act of the 97th | 24 | | General Assembly. However, except as otherwise provided in | 25 | | subsections (c) and (d) and Section 9-806, the financing |
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| 1 | | statement ceases to be effective: | 2 | | (1) if the financing statement is filed in this State, | 3 | | at the time the financing statement would have ceased to be | 4 | | effective had this amendatory Act of the 97th General | 5 | | Assembly not taken effect; or | 6 | | (2) if the financing statement is filed in another | 7 | | jurisdiction, at the earlier of: | 8 | | (A) the time the financing statement would have | 9 | | ceased to be effective under the law of that | 10 | | jurisdiction; or | 11 | | (B) June 30, 2018. | 12 | | (c) Continuation statement. The filing of a continuation | 13 | | statement after the effective date of this amendatory Act of | 14 | | the 97th General Assembly does not continue the effectiveness | 15 | | of a financing statement filed before the effective date of | 16 | | this amendatory Act of the 97th General Assembly. However, upon | 17 | | the timely filing of a continuation statement after the | 18 | | effective date of this amendatory Act of the 97th General | 19 | | Assembly and in accordance with the law of the jurisdiction | 20 | | governing perfection as provided in Article 9, the | 21 | | effectiveness of a financing statement filed in the same office | 22 | | in that jurisdiction before the effective date of this | 23 | | amendatory Act of the 97th General Assembly continues for the | 24 | | period provided by the law of that jurisdiction. | 25 | | (d) Application of subsection (b)(2)(B) to transmitting | 26 | | utility financing statement. Subsection (b)(2)(B) applies to a |
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| 1 | | financing statement that, before the effective date of this | 2 | | amendatory Act of the 97th General Assembly, is filed against a | 3 | | transmitting utility and satisfies the applicable requirements | 4 | | for perfection under the law of the jurisdiction governing | 5 | | perfection as provided in Article 9 as it existed before the | 6 | | effective date of this amendatory Act of the 97th General | 7 | | Assembly, only to the extent that Article 9 as amended by this | 8 | | amendatory Act of the 97th General Assembly provides that the | 9 | | law of a jurisdiction other than the jurisdiction in which the | 10 | | financing statement is filed governs perfection of a security | 11 | | interest in collateral covered by the financing statement. | 12 | | (e) Application of Part 5. A financing statement that | 13 | | includes a financing statement filed before the effective date | 14 | | of this amendatory Act of the 97th General Assembly and a | 15 | | continuation statement filed after the effective date of this | 16 | | amendatory Act of the 97th General Assembly is effective only | 17 | | to the extent that it satisfies the requirements of Part 5 as | 18 | | amended by this amendatory Act of the 97th General Assembly for | 19 | | an initial financing statement. A financing statement that | 20 | | indicates that the debtor is a decedent's estate indicates that | 21 | | the collateral is being administered by a personal | 22 | | representative within the meaning of Section 9-503(a)(2) as | 23 | | amended by this amendatory Act of the 97th General Assembly. A | 24 | | financing statement that indicates that the debtor is a trust | 25 | | or is a trustee acting with respect to property held in trust | 26 | | indicates that the collateral is held in a trust within the |
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| 1 | | meaning of Section 9-503(a)(3) as amended by this amendatory | 2 | | Act of the 97th General Assembly. | 3 | | (810 ILCS 5/9-806 new) | 4 | | Sec. 9-806. When initial financing statement suffices to | 5 | | continue effectiveness of financing statement. | 6 | | (a) Initial financing statement in lieu of continuation | 7 | | statement. The filing of an initial financing statement in the | 8 | | office specified in Section 9-501 continues the effectiveness | 9 | | of a financing statement filed before the effective date of | 10 | | this amendatory Act of the 97th General Assembly if: | 11 | | (1) the filing of an initial financing statement in | 12 | | that office would be effective to perfect a security | 13 | | interest under Article 9 as amended by this amendatory Act | 14 | | of the 97th General Assembly; | 15 | | (2) the pre-effective-date financing statement was | 16 | | filed in an office in another State; and | 17 | | (3) the initial financing statement satisfies | 18 | | subsection (c). | 19 | | (b) Period of continued effectiveness. The filing of an | 20 | | initial financing statement under subsection (a) continues the | 21 | | effectiveness of the pre-effective-date financing
statement: | 22 | | (1) if the initial financing statement is filed before | 23 | | the effective date of this amendatory Act of the 97th | 24 | | General Assembly, for the period provided in Section 9-515 | 25 | | as it existed before the effective date of this amendatory |
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| 1 | | Act of the 97th General Assembly with respect to an initial | 2 | | financing statement; and | 3 | | (2) if the initial financing statement is filed after | 4 | | the effective date of this amendatory Act of the 97th | 5 | | General Assembly, for the period provided in Section 9-515 | 6 | | as amended by this amendatory Act of the 97th General | 7 | | Assembly with respect to an initial financing statement. | 8 | | (c) Requirements for initial financing statement under | 9 | | subsection (a). To be effective for purposes of subsection (a), | 10 | | an initial financing statement must: | 11 | | (1) satisfy the requirements of Part 5 as amended by | 12 | | this amendatory Act of the 97th General Assembly for an | 13 | | initial financing statement; | 14 | | (2) identify the pre-effective-date financing | 15 | | statement by indicating the office in which the financing | 16 | | statement was filed and providing the dates of filing and | 17 | | file numbers, if any, of the financing statement and of the | 18 | | most recent continuation statement filed with respect to | 19 | | the financing statement; and | 20 | | (3) indicate that the pre-effective-date financing | 21 | | statement remains effective. | 22 | | (810 ILCS 5/9-807 new) | 23 | | Sec. 9-807. Amendment of pre-effective-date financing | 24 | | statement. | 25 | | (a) "Pre-effective-date financing statement". In this |
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| 1 | | Section, "pre-effective-date financing statement" means a | 2 | | financing statement filed before the effective date of this | 3 | | amendatory Act of the 97th General Assembly. | 4 | | (b) Applicable law. After this amendatory Act of the 97th | 5 | | General Assembly takes effect, a person may add or delete | 6 | | collateral covered by, continue or terminate the effectiveness | 7 | | of, or otherwise amend the information provided in, a | 8 | | pre-effective-date financing statement only in accordance with | 9 | | the law of the jurisdiction governing perfection as provided in | 10 | | Article 9 as amended by this amendatory Act of the 97th General | 11 | | Assembly. However, the effectiveness of a pre-effective-date | 12 | | financing statement also may be terminated in accordance with | 13 | | the law of the jurisdiction in which the financing statement is | 14 | | filed. | 15 | | (c) Method of amending: general rule. Except as otherwise | 16 | | provided in subsection (d), if the law of this State governs | 17 | | perfection of a security interest, the information in a | 18 | | pre-effective-date financing statement may be amended after | 19 | | the effective date of this amendatory Act of the 97th General | 20 | | Assembly only if: | 21 | | (1) the pre-effective-date financing statement and an | 22 | | amendment are filed in the office specified in Section | 23 | | 9-501; | 24 | | (2) an amendment is filed in the office specified in | 25 | | Section 9-501 concurrently with, or after the filing in | 26 | | that office of, an initial financing statement that |
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| 1 | | satisfies Section 9-806(c); or | 2 | | (3) an initial financing statement that provides the | 3 | | information as amended and satisfies Section 9-806(c) is | 4 | | filed in the office specified in Section 9-501. | 5 | | (d) Method of amending: continuation. If the law of this | 6 | | State governs perfection of a security interest, the | 7 | | effectiveness of a pre-effective-date financing statement may | 8 | | be continued only under Section 9-805(c) and (e) or 9-806. | 9 | | (e) Method of amending: additional termination rule. | 10 | | Whether or not the law of this State governs perfection of a | 11 | | security interest, the effectiveness of a pre-effective-date | 12 | | financing statement filed in this State may be terminated after | 13 | | the effective date of this amendatory Act of the 97th General | 14 | | Assembly by filing a termination statement in the office in | 15 | | which the pre-effective-date financing statement is filed, | 16 | | unless an initial financing statement that satisfies Section | 17 | | 9-806(c) has been filed in the office specified by the law of | 18 | | the jurisdiction governing perfection as provided in Article 9 | 19 | | as amended by this amendatory Act of the 97th General Assembly | 20 | | as the office in which to file a financing statement. | 21 | | (810 ILCS 5/9-808 new) | 22 | | Sec. 9-808. Person entitled to file initial financing | 23 | | statement or continuation statement. A person may file an | 24 | | initial financing statement or a continuation statement under | 25 | | this part if: |
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| 1 | | (1) the secured party of record authorizes the filing; | 2 | | and | 3 | | (2) the filing is necessary under this Part: | 4 | | (A) to continue the effectiveness of a financing | 5 | | statement filed before the effective date of this | 6 | | amendatory Act of the 97th General Assembly; or | 7 | | (B) to perfect or continue the perfection of a | 8 | | security interest. | 9 | | (810 ILCS 5/9-809 new) | 10 | | Sec. 9-809. Priority. This Act determines the priority of | 11 | | conflicting claims to collateral. However, if the relative | 12 | | priorities of the claims were established before the effective | 13 | | date of this amendatory Act of the 97th General Assembly, | 14 | | Article 9 as it existed before the effective date of this | 15 | | amendatory Act of the 97th General Assembly determines | 16 | | priority.
| 17 | | Section 99. Effective date. This Act takes effect July 1, | 18 | | 2013. |
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