Assignment of security interest; duties of filing officer; fees.
Release of collateral; duties of filing officer; fees.
Duties and liability of filing officer.
Financing statements covering consigned or leased goods.
Storage of records.
Statewide lien system.
Uniform commercial code statewide lien system council.
Default; procedure when security agreement covers both real and personal property.
Collection rights of secured party.
Secured party's right to take possession after default.
Secured party's right to dispose of collateral after default; effect of disposition.
Compulsory disposition of collateral; acceptance of the collateral as discharge of obligation.
Debtor's right to redeem collateral.
Secured party's liability for failure to comply with default provisions.
Ch. 409 Cross-reference
See definitions in s. 401.201
SHORT TITLE, APPLICABILITY AND DEFINITIONS
This chapter shall be known and may be cited as uniform commercial code—secured transactions.
When does a debtor have rights in the collateral under article 9 of the uniform commercial code? Anzivino. 61 MLR 23.
Policy and subject matter of chapter. 409.102(1)(1)
Except as otherwise provided in s. 409.104
on excluded transactions, this chapter applies:
To any transaction (regardless of its form) which is intended to create a security interest in personal property or fixtures including goods, documents, instruments, general intangibles, chattel paper or accounts.
This chapter applies to security interests created by contract including pledge, assignment, chattel mortgage, chattel trust, trust deed, factor's lien, equipment trust, conditional sale, trust receipt, other lien or title retention contract and lease or consignment intended as security. This chapter does not apply to statutory liens except as provided in s. 409.310
The application of this chapter to a security interest in a secured obligation is not affected by the fact that the obligation is itself secured by a transaction or interest to which this chapter does not apply.
History: 1973 c. 215
A lease requiring a security deposit may operate to create a security interest in the deposit subject to this chapter. Demotropoulous v. Bank One Milwaukee, 924 F Supp. 894 (1996).
Secured transactions under the uniform commercial code: changes in Wisconsin filing provisions. 1974 WLR 864.
Perfection of security interests in multiple state transactions. 409.103(1)(1)
Documents, instruments and ordinary goods. 409.103(1)(a)(a)
This subsection applies to documents and instruments and to goods other than those covered by a certificate of title described in sub. (2)
, mobile goods described in sub. (3)
, and minerals described in sub. (5)
Except as otherwise provided in this subsection, perfection and the effect of perfection or nonperfection of a security interest in collateral are governed by the law of the jurisdiction where the collateral is when the last event occurs on which is based the assertion that the security interest is perfected or unperfected.
If the parties to a transaction creating a purchase money security interest in goods in one jurisdiction understand at the time that the security interest attaches that the goods will be kept in another jurisdiction, then the law of the other jurisdiction governs the perfection and the effect of perfection or nonperfection of the security interest from the time it attaches until 30 days after the debtor receives possession of the goods and thereafter if the goods are taken to the other jurisdiction before the end of the 30-day period.
When collateral is brought into and kept in this state while subject to a security interest perfected under the law of the jurisdiction from which the collateral was removed, the security interest remains perfected, but if action is required by ss. 409.301
to perfect the security interest:
If the action is not taken before the expiration of the period of perfection in the other jurisdiction or the end of 4 months after the collateral is brought into this state, whichever period first expires, the security interest becomes unperfected at the end of that period and is thereafter deemed to have been unperfected as against a person who became a purchaser after removal;
If the action is taken before the expiration of the period specified in subd. 1.
, the security interest continues perfected thereafter;
For the purpose of priority over a buyer of consumer goods (s. 409.307 (2)
), the period of the effectiveness of a filing in the jurisdiction from which the collateral is removed is governed by the rules with respect to perfection in subds. 1.
This subsection applies to goods covered by a certificate of title issued under a statute of this state or of another jurisdiction under the law of which indication of a security interest on the certificate is required as a condition of perfection.
Except as otherwise provided in this subsection, perfection and the effect of perfection or nonperfection of the security interest are governed by the law (including the conflict of laws rules) of the jurisdiction issuing the certificate until 4 months after the goods are removed from that jurisdiction and thereafter until the goods are registered in another jurisdiction, but in any event not beyond surrender of the certificate. After the expiration of that period, the goods are not covered by the certificate of title within the meaning of this section.
Except with respect to the rights of a buyer described in par. (d)
, a security interest, perfected in another jurisdiction otherwise than by notation on a certificate of title, in goods brought into this state and thereafter covered by a certificate of title issued by this state is subject to sub. (1) (d)
If goods are brought into this state while a security interest therein is perfected in any manner under the law of the jurisdiction from which the goods are removed and a certificate of title is issued by this state and the certificate does not show that the goods are subject to the security interest or that they may be subject to security interests not shown on the certificate, the security interest is subordinate to the rights of a buyer of the goods who is not in the business of selling goods of that kind to the extent that the buyer gives value and receives delivery of the goods after issuance of the certificate and without knowledge of the security interest.
(3) Accounts, general intangibles and mobile goods. 409.103(3)(a)(a)
This subsection applies to accounts, other than an account described in sub. (5)
on minerals, and general intangibles, other than uncertificated securities, and to goods which are mobile and which are of a type normally used in more than one jurisdiction, such as motor vehicles, trailers, rolling stock, airplanes, shipping containers, road building and construction machinery and commercial harvesting machinery and the like, if the goods are equipment or are inventory leased or held for lease by the debtor to others, and are not covered by a certificate of title described in sub. (2)
The law (including the conflict of laws rules) of the jurisdiction in which the debtor is located governs the perfection and the effect of perfection or nonperfection of the security interest.
If, however, the debtor is located in a jurisdiction which is not a part of the United States, and which does not provide for perfection of the security interest by filing or recording in that jurisdiction, the law of the jurisdiction in the United States in which the debtor has its major executive office in the United States governs the perfection and the effect of perfection or nonperfection of the security interest through filing. In the alternative, if the debtor is located in a jurisdiction which is not a part of the United States or Canada and the collateral is accounts or general intangibles for money due or to become due, the security interest may be perfected by notification to the account debtor. As used in this paragraph, "United States" includes its territories and possessions and the Commonwealth of Puerto Rico.
A debtor shall be deemed located at the debtor's place of business if the debtor has one, at the debtor's chief executive office if the debtor has more than one place of business, otherwise at the debtor's residence. If, however, the debtor is a foreign air carrier under the federal aviation act of 1958, as amended, it shall be deemed located at the designated office of the agent upon whom service of process may be made on behalf of the foreign air carrier.
A security interest perfected under the law of the jurisdiction of the location of the debtor is perfected until the expiration of 4 months after a change of the debtor's location to another jurisdiction, or until perfection would have ceased by the law of the first jurisdiction, whichever period first expires. Unless perfected in the new jurisdiction before the end of that period, it becomes unperfected thereafter and is deemed to have been unperfected as against a person who became a purchaser after the change.
(4) Chattel paper.
The rules stated for goods in sub. (1)
apply to a possessory security interest in chattel paper. The rules stated for accounts in sub. (3)
apply to a nonpossessory security interest in chattel paper, but the security interest may not be perfected by notification to the account debtor.
Perfection and the effect of perfection or nonperfection of a security interest which is created by a debtor who has an interest in minerals or the like (including oil and gas) before extraction and which attaches thereto as extracted, or which attaches to an account resulting from the sale thereof at the wellhead or minehead are governed by the law (including the conflict of laws rules) of the jurisdiction wherein the wellhead or minehead is located.
(6) Uncertificated securities.
The law, including the conflict of laws rules, of the jurisdiction of organization of the issuer governs the perfection and the effect of perfection or nonperfection of a security interest in uncertificated securities.
Transactions excluded from chapter.
This chapter does not apply:
To a security interest subject to any statute of the United States to the extent that such statute governs the rights of parties to and 3rd parties affected by transactions in particular types of property; or
To a nonconsensual landlord's lien; or
To a lien given by statute or other rule of law for services or materials except as provided in s. 409.310
on priority of such liens; or
To a transfer of a claim for wages, salary or other compensation of an employe; or
To a sale of accounts or chattel paper as part of a sale of the business out of which they arose, or an assignment of accounts or chattel paper which is for the purpose of collection only, or a transfer of a right to payment under a contract to an assignee who is also to do the performance under the contract or a transfer of a single account to an assignee in whole or partial satisfaction of a preexisting indebtedness; or
To a transfer of an interest or claim in or under any policy of insurance, except as provided with respect to proceeds in s. 409.306
and priorities in proceeds in s. 409.312
To a right represented by a judgment (other than a judgment taken on a right to payment which was collateral); or
Except to the extent that provision is made for fixtures in s. 409.313
, to the creation or transfer of an interest in or lien on real estate, including a lease or rents thereunder and including an interest in or lien on real estate owned by a public utility even though for some purposes such real estate is deemed to be personal property; or
To a transfer in whole or in part of any claim arising out of tort; or
To a contract between a cooperative association and a member thereof, authorized by s. 185.41
To a transfer of an interest in any deposit account as defined in s. 409.105 (1)
, except as provided with respect to proceeds under s. 409.306
and priorities in proceeds under s. 409.312
History: 1973 c. 215
Legislative Council Note, 1973: Sub. (2) is amended to make it clear that contractual landlord's liens are not exempt from coverage by ch. 409. Wisconsin has abolished the common law landlord's lien, distress for rent. See s. 704.11, Wis. Stats. (Bill 177-S)
Definitions and index of definitions. 409.105(1)
In this chapter unless the context otherwise requires:
"Account debtor" means the person who is obligated on an account, chattel paper or general intangible.
"Chattel paper" means a writing or writings which evidence both a monetary obligation and a security interest in or a lease of specific goods, but a charter or other contract involving the use or hire of a vessel is not chattel paper. When a transaction is evidenced both by such a security agreement or a lease and by an instrument or a series of instruments, the group of writings taken together constitutes chattel paper.
"Collateral" means the property subject to a security interest, and includes accounts and chattel paper which have been sold.
"Debtor" means the person who owes payment or other performance of the obligation secured, whether or not that person owns or has rights in the collateral, and includes the seller of accounts or chattel paper. Where the debtor and the owner of the collateral are not the same person, the term "debtor" means the owner of the collateral in any provision of the chapter dealing with the collateral, the obligor in any provision dealing with the obligation, and may include both where the context so requires.
"Department" means the department of financial institutions.
"Deposit account" means a demand, time, savings, passbook or like account maintained with a bank, savings bank, savings and loan association, credit union or like organization, other than an account evidenced by a certificate of deposit.
"Encumbrance" includes real estate mortgages and other liens on real estate and all other rights in real estate that are not ownership interests.
"Goods" includes all things which are movable at the time the security interest attaches or which are fixtures (s. 409.313
), but does not include money, documents, instruments, accounts, chattel paper, general intangibles or minerals or the like (including oil and gas) before extraction. "Goods" also includes standing timber which is to be cut and removed under a conveyance or contract for sale, the unborn young of animals and growing crops.
"Instrument" means a negotiable instrument as defined in s. 403.104
or a certificated security as defined in s. 408.102
or any other writing which evidences a right to the payment of money and is not itself a security agreement or lease and is of a type which is in ordinary course of business transferred by delivery with any necessary endorsement or assignment.
"Mortgage" means a consensual interest created by a real estate mortgage, a trust deed on real estate, or the like.
An advance is made "pursuant to commitment" if the secured party has bound himself or herself to make it, whether or not a subsequent event of default or other event not within the secured party's control has relieved or may relieve the secured party from the secured party's obligation.
"Secured party" means a lender, seller or other person in whose favor there is a security interest, including a person to whom accounts or chattel paper have been sold. When the holders of obligations issued under an indenture of trust, equipment trust agreement or the like are represented by a trustee or other person, the representative is the secured party.
"Security agreement" means an agreement which creates or provides for a security interest.
"Transmitting utility" means any person primarily engaged in the railroad business, the electric or electronics communications transmission business, the transmission of goods by pipeline, or the transmission or the production and transmission of electricity, steam, gas or water, or the provision of sewer service.
Other definitions applying to this chapter and the sections in which they appear are: