LRB-2465/2
KSH:mfd:jf
1997 - 1998 LEGISLATURE
July 15, 1997 - Introduced by Representatives Cullen and Green, cosponsored by
Senators George and Huelsman. Referred to Committee on Financial
Institutions.
AB457,1,6 1An Act to repeal 401.105 (2) (c), chapter 406 (title), 406.101, 406.102 (3) and
2409.111; to renumber and amend 406.102 (title), (1), (2), (3m) and (4),
3406.103, 406.104, 406.105, 406.107, 406.108, 406.109, 406.110 and 406.111; to
4amend
402.403 (4), 452.09 (3) (a), 480.08 (2m) (intro.) and 480.14 (4); and to
5create
subchapter IV (title) of chapter 125 [precedes 125.80] of the statutes;
6relating to: bulk transfers of inventory.
Analysis by the Legislative Reference Bureau
Under current law, the bulk transfer provisions of the uniform commercial code
(UCC) generally require a business enterprise to give creditors notice before any
transfer of a major part of the value of the business's inventory or a substantial part
of the equipment of the business, if the equipment is included with a bulk transfer
of inventory. These provisions apply to all business enterprises whose principal
business is the sale of merchandise from stock, including retailers of alcohol
beverages. This bill removes the bulk transfer provisions from the UCC and makes
the bulk transfer provisions applicable only to retailers of alcohol beverages.
The National Conference of Commissioners on Uniform State Laws and the
American Law Institute recommended repeal of the UCC bulk transfers law in 1989

and promulgated the official text. The American Bar Association approved the text
in 1990.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB457, s. 1 1Section 1. Subchapter IV (title) of chapter 125 [precedes 125.80] of the
2statutes is created to read:
AB457,2,33 Chapter 125
AB457,2,54 SubchaPter IV
5 Bulk transfers by retailers
AB457, s. 2 6Section 2. 401.105 (2) (c) of the statutes is repealed.
AB457, s. 3 7Section 3. 402.403 (4) of the statutes is amended to read:
AB457,2,98 402.403 (4) The rights of other purchasers of goods and of lien creditors are
9governed by chs. 406, 407 and 409.
AB457, s. 4 10Section 4. Chapter 406 (title) of the statutes is repealed.
AB457, s. 5 11Section 5. 406.101 of the statutes is repealed.
AB457, s. 6 12Section 6. 406.102 (title), (1), (2), (3m) and (4) of the statutes are renumbered
13125.80 (title), (1), (2), (3m) and (4) and amended to read:
AB457,2,19 14125.80 (title) "Bulk transfers"; transfers of equipment; enterprises
15subject to this chapter; bulk transfers subject to
Applicability of this
16chapter subchapter. (1) A "bulk transfer" is any transfer in bulk and not in the
17ordinary course of the transferor's retailer's business of a major part in value of the
18retailer's inventory (, as described under s. 409.109) of an enterprise subject to this
19chapter
(4).
AB457,3,3
1(2) A transfer of a substantial part of the equipment (, as described under s.
2409.109) of such an enterprise (2), of a retailer is a bulk transfer if it is made in
3connection with a bulk transfer of inventory, but not otherwise.
AB457,3,8 4(3m) The sale, transfer or assignment, in bulk, of any stock of merchandise or
5of fixtures, pertaining to the merchandise, including any sale, transfer or
6assignment made in consideration of any existing indebtedness, otherwise than in
7the ordinary course of trade and in the usual conduct of business by retailers of
8alcohol beverages
, is subject to this chapter subchapter.
AB457,3,10 9(4) Except as limited by s. 406.103 125.81, all bulk transfers of goods located
10within this state are subject to this chapter subchapter.
AB457, s. 7 11Section 7. 406.102 (3) of the statutes is repealed.
AB457, s. 8 12Section 8. 406.103 of the statutes is renumbered 125.81 and amended to read:
AB457,3,14 13125.81 (title) Transfers excepted from this chapter subchapter. (1) The
14following transfers are not subject to this chapter subchapter:
AB457,3,1515 (a) Those made to give security for the performance of an obligation ;.
AB457,3,1716 (b) General assignments for the benefit of all the creditors of the transferor
17retailer, and subsequent transfers by the assignee thereunder;.
AB457,3,1918 (c) Transfers Except as provided in s. 125.80 (3m), transfers in settlement or
19realization of a lien or other security interest;.
AB457,3,2120 (d) Sales by executors, administrators, receivers, trustees in bankruptcy, or any
21public officer under judicial process;.
AB457,3,2522 (e) Sales made in the course of judicial or administrative proceedings for the
23dissolution or reorganization of a corporation retailer and of which notice is sent to
24the creditors of the corporation retailer pursuant to order of the court or
25administrative agency;.
AB457,4,3
1(f) Transfers to a person maintaining a known place of business in this state
2who becomes bound to pay the debts of the transferor retailer in full and gives public
3notice of that fact, and who is solvent after becoming so bound;.
AB457,4,84 (g) A transfer to a new business enterprise organized to take over and continue
5the business, if public notice of the transaction is given and the new enterprise
6assumes the debts of the transferor retailer and the transferor retailer receives
7nothing from the transaction except an interest in the new enterprise junior to the
8claims of creditors;.
AB457,4,99 (h) Transfers of property which that is exempt from execution.
AB457,4,13 10(2) Public notice under sub. (1) (f) or (g) may be given by publication of a class
112 notice, under ch. 985, where the transferor retailer had its principal place of
12business in this state. The notice shall include the names and addresses of the
13transferor retailer and transferee and the effective date of the transfer.
AB457, s. 9 14Section 9. 406.104 of the statutes is renumbered 125.82 and amended to read:
AB457,4,18 15125.82 Schedule of property, list of creditors. (1) Except as provided with
16respect to auction sales ( s. 406.108) under s. 125.85, a bulk transfer subject to this
17chapter subchapter is ineffective against any creditor of the transferor retailer
18unless all of the following conditions are met:
AB457,4,2019 (a) The transferee requires the transferor retailer to furnish a list of the
20transferor's retailer's existing creditors prepared as stated in this section; and.
AB457,4,2221 (b) The parties prepare a schedule of the property transferred sufficient to
22identify it; and.
AB457,5,223 (c) The transferee preserves the list and schedule for 6 months next following
24the transfer and permits inspection of either or both and copying therefrom at all

1reasonable hours by any creditor of the transferor retailer, or files the list and
2schedule with the department of financial institutions.
AB457,5,12 3(2) The list of creditors must be signed and sworn to or affirmed by the
4transferor retailer or the transferor's retailer's agent. It must contain the names and
5business addresses of all creditors of the transferor retailer, with the amounts when
6known, and also the names of all persons who are known to the transferor retailer
7to assert claims against the transferor retailer even though such claims are disputed.
8If the transferor retailer is the obligor of an outstanding issue of bonds, debentures
9or the like as to which there is an indenture trustee, the list of creditors need include
10only the name and address of the indenture trustee and the aggregate outstanding
11principal amount of the issue. The list of creditors shall include the name and
12address of the clerk of the municipality in which the property was last assessed.
AB457,5,15 13(3) Responsibility for the completeness and accuracy of the list of creditors
14rests on the transferor retailer, and the transfer is not rendered ineffective by errors
15or omissions therein unless the transferee is shown to have had knowledge.
AB457, s. 10 16Section 10. 406.105 of the statutes is renumbered 123.83 and amended to
17read:
AB457,5,24 18123.83 Notice to creditors. In addition to the requirements of s. 406.104
19125.82, any bulk transfer subject to this chapter subchapter except one made by
20auction sale ( s. 406.108) under s. 125.85 is ineffective against any creditor of the
21transferor retailer unless at least 10 days before the transferee takes possession of
22the goods or pays the major part of the purchase price, whichever happens first, the
23transferee gives notice of the transfer in the manner and to the persons specified in
24s. 406.107 125.84.
AB457, s. 11
1Section 11. 406.107 of the statutes is renumbered 125.84, and 125.84 (1), (2)
2(intro.), (a), (b) and (c) and (3), as renumbered, are amended to read:
AB457,6,43 125.84 (1) The notice to creditors ( s. 406.105) under s. 125.83 shall state all
4of the following
:
AB457,6,55 (a) That a bulk transfer is about to be made; and.
AB457,6,86 (b) The names and business addresses of the transferor retailer and transferee,
7and all other business names and addresses used by the transferor retailer within
83 years last past so far as known to the transferee; and.
AB457,6,119 (c) Whether or not all the debts of the transferor retailer are to be paid in full
10as they fall due as a result of the transaction, and if so, the address to which creditors
11should send their bills.
Loading...
Loading...