Wisconsin Legislature: 10,73

(c) If the document is presented in a written or other tangible medium and is not a certificated security, chattel paper, a document of title, an instrument, or a letter of credit, the security interest is perfected and has priority over a conflicting security interest in the document so long as the debtor does not have possession of the document.

10,60 Section 60. 406.102 (1) of the statutes is amended to read:

406.102 (1) A "bulk transfer" is any transfer in bulk and not in the ordinary course of the transferor's business of a major part in value of the inventory (s. 409.109) , as defined in s. 409.102 (1) (Ls), of an enterprise subject to this chapter.

10,61 Section 61. 406.102 (2) of the statutes is amended to read:

406.102 (2) A transfer of a substantial part of the equipment (s. 409.109), as defined in s. 409.102 (1) (i), of such an enterprise is a bulk transfer if it is made in connection with a bulk transfer of inventory, but not otherwise.

10,62 Section 62. 407.503 (1) (a) of the statutes is amended to read:

407.503 (1) (a) Delivered or entrusted them or any document of title covering them to the bailor or the bailor's nominee with actual or apparent authority to ship, store, or sell or with power to obtain delivery under s. 407.403 or with power of disposition under ss. s. 402.403 or 409.307 409.320 or other statute or rule of law; nor

10,63 Section 63. 408.103 (6) of the statutes is amended to read:

408.103 (6) A commodity contract, as defined in s. 409.115 (1) (b) 409.102 (1) (dm), is not a security or a financial asset.

10,64 Section 64. 408.106 (4) (a) and (b) of the statutes are amended to read:

408.106 (4) (a) The purchaser becomes the entitlement holder; or

(b) The securities intermediary has agreed that it will comply with entitlement orders originated by the purchaser without further consent by the entitlement holder. ; or

10,65 Section 65. 408.106 (4) (c) of the statutes is created to read:

408.106 (4) (c) Another person has control of the security entitlement on behalf of the purchaser or, having previously acquired control of the security entitlement, acknowledges that it has control on behalf of the purchaser.

10,66 Section 66. 408.106 (6) of the statutes is amended to read:

408.106 (6) A purchaser who has satisfied the requirements of sub. (3) (b) or (4) (b) has control even if the registered owner in the case of sub. (3) (b) or the entitlement holder in the case of sub. (4) (b) retains the right to make substitutions for the uncertificated security or security entitlement, to originate instructions or entitlement orders to the issuer or securities intermediary, or otherwise to deal with the uncertificated security or security entitlement.

10,67 Section 67. 408.110 (5) (a) of the statutes is amended to read:

408.110 (5) (a) If an agreement between the securities intermediary and its entitlement holder specifies that it is governed by the law of a particular jurisdiction governing the securities account expressly provides that a particular jurisdiction is the securities intermediary's jurisdiction for purposes of this subchapter, this chapter, or chs. 401 to 411, that jurisdiction is the securities intermediary's jurisdiction.

10,68 Section 68. 408.110 (5) (b) of the statutes is renumbered 408.110 (5) (c) and amended to read:

408.110 (5) (c) If neither par. (a) nor par. (b) applies and an agreement between the securities intermediary and its entitlement holder does not specify the governing law as provided in par. (a), but governing the securities account expressly specifies provides that the securities account is maintained at an office in a particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.

10,69 Section 69. 408.110 (5) (b) of the statutes is created to read:

408.110 (5) (b) If par. (a) does not apply and an agreement between the securities intermediary and its entitlement holder governing the securities account expressly provides that the agreement is governed by the law of a particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.

10,70 Section 70. 408.110 (5) (c) of the statutes is renumbered 408.110 (5) (d) and amended to read:

408.110 (5) (d) If an agreement between the securities intermediary and its entitlement holder does not specify a jurisdiction as provided in par. (a) or (b) none of pars. (a) to (c) applies, the securities intermediary's jurisdiction is the jurisdiction in which is located the office, identified in an account statement as the office serving the entitlement holder's account, is located.

10,71 Section 71. 408.110 (5) (d) of the statutes is renumbered 408.110 (5) (e) and amended to read:

408.110 (5) (e) If an agreement between the securities intermediary and its entitlement holder does not specify a jurisdiction as provided in par. (a) or (b) and an account statement does not identify an office serving the entitlement holder's account as provided in par. (c) none of pars. (a) to (d) applies, the securities intermediary's jurisdiction is the jurisdiction in which is located the chief executive office of the securities intermediary is located.

10,72 Section 72. 408.301 (1) (c) of the statutes is renumbered 408.301 (1) (c) (intro.) and amended to read:

408.301 (1) (c) (intro.) A securities intermediary acting on behalf of the purchaser acquires possession of the security certificate, only if the certificate is in registered form and has been specially is:

3. Specially endorsed to the purchaser by an effective endorsement and has not been endorsed to the securities intermediary or in blank.

10,73 Section 73. 408.301 (1) (c) 1. and 2. of the statutes are created to read:

408.301 (1) (c) 1. Registered in the name of the purchaser;

2. Payable to the order of the purchaser; or

10,74 Section 74. 408.302 (1) of the statutes is amended to read:

408.302 (1) Except as otherwise provided in subs. (2) and (3), upon delivery a purchaser of a certificated or uncertificated security to a purchaser, the purchaser acquires all rights in the security that the transferor had or had power to transfer.

10,75 Section 75. 408.510 (1) of the statutes is amended to read:

408.510 (1) An In a case not covered by the priority rules in ch. 409 or the rules stated in sub. (3), an action based on an adverse claim to a financial asset or security entitlement, whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, may not be asserted against a person who purchases a security entitlement, or an interest therein, from an entitlement holder if the purchaser gives value, does not have notice of the adverse claim, and obtains control.

10,76 Section 76. 408.510 (3) of the statutes is renumbered 408.510 (3) (intro.) and amended to read:

408.510 (3) (intro.) In a case not covered by the priority rules in ch. 409, a purchaser for value of a security entitlement, or an interest therein, who obtains control has priority over a purchaser of a security entitlement, or an interest therein, who does not obtain control. Purchasers Except as otherwise provided in sub. (4), purchasers who have control rank equally, except that a according to priority in time of:

(4) A securities intermediary as purchaser has priority over a conflicting purchaser who has control unless otherwise agreed by the securities intermediary.

10,77 Section 77. 408.510 (3) (a) to (c) of the statutes are created to read:

408.510 (3) (a) The purchaser's becoming the person for whom the securities account, in which the security entitlement is carried, is maintained, if the purchaser obtained control under s. 408.106 (4) (a);

(b) The securities intermediary's agreement to comply with the purchaser's entitlement orders with respect to security entitlements carried or to be carried in the securities account in which the security entitlement is carried, if the purchaser obtained control under s. 408.106 (4) (b); or

(c) If the purchaser obtained control through another person under s. 408.106 (4) (c), the time on which priority would be based under this subsection if the other person were the secured party.

10,78 Section 78. Chapter 409 of the statutes is repealed and recreated to read:

Chapter 409
uniform commercial code —
secured transactions

Subchapter I
GENERAL PROVISIONS

409.101 Short title. This chapter may be cited as uniform commercial code — secured transactions.

409.102 Definitions and index of definitions. (1) Chapter 409 definitions. In this chapter:

(a) "Accession" means goods that are physically united with other goods in such a manner that the identity of the original goods is not lost.

(ag) "Account", except as used in "account for", means a right to payment of a monetary obligation, whether or not earned by performance; for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of; for services rendered or to be rendered; for a policy of insurance issued or to be issued; for a secondary obligation incurred or to be incurred; for energy provided or to be provided; for the use or hire of a vessel under a charter or other contract; arising out of the use of a credit or charge card or information contained on or for use with the card; or as winnings in a lottery or other game of chance operated or sponsored by a state, governmental unit of a state, or person licensed or authorized to operate the game by a state or governmental unit of a state. The term includes health-care-insurance receivables. The term does not include rights to payment evidenced by chattel paper or an instrument; commercial tort claims; deposit accounts; investment property; letter-of-credit rights or letters of credit; or rights to payment for money or funds advanced or sold, other than rights arising out of the use of a credit or charge card or information contained on or for use with the card.

(am) "Account debtor" means a person obligated on an account, chattel paper, or general intangible. The term does not include persons obligated to pay a negotiable instrument, even if the instrument constitutes part of chattel paper.

(as) "Accounting", except as used in "accounting for", means a record:

1. Authenticated by a secured party;

2. Indicating the aggregate unpaid secured obligations as of a date not more than 35 days earlier or 35 days later than the date of the record; and

3. Identifying the components of the obligations in reasonable detail.

(b) "Agricultural lien" means an interest, other than a security interest, in farm products:

1. Which secures payment or performance of an obligation for:

a. Goods or services furnished in connection with a debtor's farming operation; or

b. Rent on real property leased by a debtor in connection with its farming operation;

2. Which is created by statute in favor of a person that:

a. In the ordinary course of its business furnished goods or services to a debtor in connection with a debtor's farming operation; or

b. Leased real property to a debtor in connection with the debtor's farming operation; and

3. Whose effectiveness does not depend on the person's possession of the personal property.

(bcm) "Applicant" means a person at whose request or for whose account a letter of credit is issued. The term includes a person who requests an issuer to issue a letter of credit on behalf of another if the person making the request undertakes an obligation to reimburse the issuer.

(bg) "As-extracted collateral" means:

1. Oil, gas, or other minerals that are subject to a security interest that is created by a debtor having an interest in the minerals before extraction and which attaches to the minerals as extracted; or

2. Accounts arising out of the sale at the wellhead or minehead of oil, gas, or other minerals in which the debtor had an interest before extraction.

(bm) "Authenticate" means:

1. To sign; or

2. To execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.

(bs) "Bank" means an organization that is engaged in the business of banking. The term includes savings banks, savings and loan associations, credit unions, and trust companies.

(btm) "Beneficiary" means a person who under the terms of a letter of credit is entitled to have its complying presentation honored. The term includes a person to whom drawing rights have been transferred under a transferable letter of credit.

(cg) "Certificate of title" means a certificate of title with respect to which a statute provides for the security interest in question to be indicated on the certificate as a condition or result of the security interest's obtaining priority over the rights of a lien creditor with respect to the collateral.

(cm) "Chattel paper" means a record or records that evidence both a monetary obligation and a security interest in specific goods, a security interest in specific goods and software used in the goods, a security interest in specific goods and license of software used in the goods, a lease of specific goods, or a lease of specific goods and license of software used in the goods. The term does not include charters or other contracts involving the use or hire of a vessel. The term does not include records that evidence a right to payment arising out of the use of a credit or charge card or information contained on or for use with the card. If a transaction is evidenced by records that include an instrument or series of instruments, the group of records taken together constitutes chattel paper. In this paragraph, "monetary obligation" means a monetary obligation secured by the goods or owned under a lease of the goods and includes a monetary obligation with respect to software used in the goods.

(cs) "Collateral" means the property subject to a security interest or agricultural lien. The term includes:

1. Proceeds to which a security interest attaches;

2. Accounts, chattel paper, payment intangibles, and promissory notes that have been sold; and

3. Goods that are the subject of a consignment.

(d) "Commercial tort claim" means a claim arising in tort with respect to which:

1. The claimant is an organization; or

2. The claimant is an individual and the claim:

a. Arose in the course of the claimant's business or profession; and

b. Does not include damages arising out of personal injury to or the death of an individual.

(dg) "Commodity account" means an account maintained by a commodity intermediary in which a commodity contract is carried for a commodity customer.

(dm) "Commodity contract" means a commodity futures contract, an option on a commodity futures contract, a commodity option, or another contract if the contract or option is:

1. Traded on or subject to the rules of a board of trade that has been designated as a contract market for such a contract pursuant to federal commodities laws; or

2. Traded on a foreign commodity board of trade, exchange, or market, and is carried on the books of a commodity intermediary for a commodity customer.

(ds) "Commodity customer" means a person for which a commodity intermediary carries a commodity contract on its books.