LRBs0242/1
MDK&RAC:wlj:pg
2007 - 2008 LEGISLATURE
ASSEMBLY SUBSTITUTE AMENDMENT 1,
TO 2007 ASSEMBLY BILL 480
February 4, 2008 - Offered by Representative Cullen.
AB480-ASA1,1,6
1An Act to amend 59.43 (1) (L), 59.43 (1) (n), 126.25 (11), 137.12 (2) (b), 137.24
2(4), 340.01 (56o), 342.03, 402.202 (1), 402.208 (2), 403.103 (1) (j), 407.102 (1) (e),
3407.103 (2), 410.106 (1), 410.204 (2), 411.501 (4), 706.08 (4) (c) and 893.36 (1g)
4(a); and
to repeal and recreate chapter 401 of the statutes;
relating to:
5adopting revised article 1 of the Uniform Commercial Code concerning general
6provisions.
Analysis by the Legislative Reference Bureau
This substitute amendment repeals and recreates the general provisions
chapter of the Uniform Commercial Code (UCC). The UCC governs certain
transactions relating to sales, negotiable instruments, bank deposits and collections,
letters of credit, bulk transfers, documents of title, investment securities, secured
transactions, fund transfers, and leases. The substitute amendment revises and
updates the general provisions chapter to better reflect and accommodate changing
business practices. The substitute amendment also makes many changes of a
technical or nonsubstantive nature, such as reordering and renumbering sections.
In terms of substantive changes to the general provisions chapter of the UCC, the
substitute amendment does all of the following:
1. Clarifies that the general provisions chapter applies only to transactions
governed by the UCC and not other law.
2. Clarifies when other principles of law may be used to supplement UCC
provisions of law.
3. Specifically provides that evidence of "course of performance" may be used
to interpret a contract along with course of dealing and usage of trade.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB480-ASA1,2,62
59.43
(1) (L) File all documents pertaining to security interests, as defined in
3s. 401.201
(37) (a) (2) (t), that are required or authorized by law to be filed with the
4register. Except as otherwise prescribed by the department of financial institutions
5under subch. V of ch. 409, these documents shall be executed in a manner that
6satisfies the requirements set forth in sub. (2m) (b) 1. to 5.
AB480-ASA1,2,118
59.43
(1) (n) Upon the filing of a financing statement or other document
9evidencing the creation of a security interest, as defined in s. 401.201
(37) (a) (2) (t),
10required to be filed or recorded with the register under s. 409.501 (1) (a), index the
11statement or document in the real estate records index under sub. (9).
AB480-ASA1,2,1413
126.25
(11) "Warehouse receipt" means a receipt for grain, issued by a grain
14warehouse keeper, that is also a document of title under s. 401.201
(15) (2) (i).
AB480-ASA1, s. 4
15Section
4. 137.12 (2) (b) of the statutes is amended to read:
AB480-ASA1,2,1716
137.12
(2) (b) Chapters 401 and 403 to 410, other than
ss. 401.107 and 401.206 17s. 401.306.
AB480-ASA1,3,619
137.24
(4) Except as otherwise agreed, a person having control of a transferable
20record is the holder, as defined in s. 401.201
(20)
(2) (km), of the transferable record
1and has the same rights and defenses as a holder of an equivalent record or writing
2under chs. 401 to 411, including, if the applicable statutory requirements under s.
3403.302 (1), 407.501, or 409.330 are satisfied, the rights and defenses of a holder in
4due course, a holder to which a negotiable record of title has been duly negotiated,
5or a purchaser, respectively. Delivery, possession, and endorsement are not required
6to obtain or exercise any of the rights under this subsection.
AB480-ASA1,3,98
340.01
(56o) "Security interest" means a security interest as defined in s.
9401.201
(37) (2) (t).
AB480-ASA1,3,16
11342.03 Motor vehicle, trailer or semitrailer leases. Notwithstanding s.
12401.201
(37) (2) (t) or ch. 409, a transaction involving a motor vehicle, trailer or
13semitrailer does not create a conditional sale or a security interest merely because
14it includes a provision that permits or requires the rental price to be adjusted under
15the agreement by reference to the amount realized upon the sale or other disposition
16of the motor vehicle, trailer or semitrailer.
AB480-ASA1, s. 8
17Section
8. Chapter 401 of the statutes is repealed and recreated to read:
AB480-ASA1,3,1919
Uniform commercial code
AB480-ASA1,3,20
20— General provisions
AB480-ASA1,3,2121
Subchapter I
AB480-ASA1,3,2222
General provisions
AB480-ASA1,3,24
23401.101 Short titles. (1) Chapters 401 to 411 may be cited as the uniform
24commercial code.
AB480-ASA1,4,2
1(2) This chapter may be cited as uniform commercial code — general
2provisions.
AB480-ASA1,4,4
3401.102 Scope of chapter. This chapter applies to a transaction to the extent
4that it is governed by another chapter in chs. 402 to 411.
AB480-ASA1,4,8
5401.103 Construction of uniform commercial code to promote its
6purposes and policies; applicability of supplemental principles of law. (1)
7 Chapters 401 to 411 must be liberally construed and applied to promote its
8underlying purposes and policies, which are all of the following:
AB480-ASA1,4,109
(a) To simplify, clarify, and modernize the law governing commercial
10transactions.
AB480-ASA1,4,1211
(b) To permit the continued expansion of commercial practices through custom,
12usage, and agreement of the parties.
AB480-ASA1,4,1313
(c) To make uniform the law among the various jurisdictions.
AB480-ASA1,4,18
14(2) Unless displaced by the particular provisions of chs. 401 to 411, the
15principles of law and equity, including the law merchant and the law relative to
16capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress,
17coercion, mistake, bankruptcy, or other validating or invalidating cause shall
18supplement its provisions.
AB480-ASA1,4,22
19401.104 Construction against implied repeal. Chapters 401 to 411 being
20a general act intended as a unified coverage of its subject matter, no part of it shall
21be deemed to be impliedly repealed by subsequent legislation if such construction can
22reasonably be avoided.
AB480-ASA1,4,24
23401.106 Use of singular and plural; gender. In chs. 401 to 411, unless the
24statutory context otherwise requires, all of the following apply:
AB480-ASA1,5,2
1(1) Words in the singular number include the plural, and those in the plural
2include the singular.
AB480-ASA1,5,3
3(2) Words of any gender also refer to any other gender.
AB480-ASA1,5,5
4401.107 Captions. Section captions are part of chs. 401 to 411,
5notwithstanding s. 990.001 (6).
AB480-ASA1,5,66
Subchapter Ii
AB480-ASA1,5,87
GENERAL DEFINITIONS AND
8
PRINCIPLES OF INTERPRETATION
AB480-ASA1,5,12
9401.201 General definitions. (1) Unless the context otherwise requires,
10words or phrases defined in this section, or in the additional definitions contained
11in chs. 402 to 411 that apply to particular chapters or subchapters thereof, have the
12meanings stated.
AB480-ASA1,5,14
13(2) Subject to definitions contained in chs. 402 to 411 that apply to particular
14chapters or subchapters thereof, in chs. 401 to 411:
AB480-ASA1,5,1715
(a) "Action," in the sense of a judicial proceeding, includes recoupment,
16counterclaim, setoff, suit in equity, and any other proceeding in which rights are
17determined.
AB480-ASA1,5,1818
(am) "Aggrieved party" means a party entitled to pursue a remedy.
AB480-ASA1,5,2119
(b) "Agreement" means the bargain of the parties in fact, as found in their
20language or inferred from other circumstances, including course of performance,
21course of dealing, or usage of trade as provided in s. 401.303. (Compare "Contract.")
AB480-ASA1,5,2322
(c) "Bank" means a person engaged in the business of banking and includes a
23savings bank, savings and loan association, credit union, and trust company.
AB480-ASA1,6,3
1(cm) "Bearer" means a person in control of a negotiable electronic document of
2title or person in possession of an instrument, negotiable tangible document of title,
3or certificated security payable to bearer or endorsed in blank.
AB480-ASA1,6,64
(d) "Bill of lading" means a document of title evidencing the receipt of goods for
5shipment issued by a person engaged in the business of directly or indirectly
6transporting or forwarding goods. The term does not include a warehouse receipt.
AB480-ASA1,6,77
(dm) "Branch" includes a separately incorporated foreign branch of a bank.
AB480-ASA1,6,98
(e) "Burden of establishing" a fact means the burden of persuading the trier of
9fact that the existence of the fact is more probable than its nonexistence.
AB480-ASA1,6,2410
(em) "Buyer in ordinary course of business" means a person that buys goods in
11good faith, without knowledge that the sale violates the rights of another person in
12the goods, and in the ordinary course from a person, other than a pawnbroker, in the
13business of selling goods of that kind. A person buys goods in the ordinary course if
14the sale to the person comports with the usual or customary practices in the kind of
15business in which the seller is engaged or with the seller's own usual or customary
16practices. A person that sells oil, gas, or other minerals at the wellhead or minehead
17is a person in the business of selling goods of that kind. A buyer in ordinary course
18of business may buy for cash, by exchange of other property, or on secured or
19unsecured credit, and may acquire goods or documents of title under a preexisting
20contract for sale. Only a buyer that takes possession of the goods or has a right to
21recover the goods from the seller under ch. 402 may be a buyer in ordinary course of
22business. A person that acquires goods in a transfer in bulk or as security for or in
23total or partial satisfaction of a money debt is not a buyer in ordinary course of
24business.
AB480-ASA1,7,4
1(f) "Conspicuous," with reference to a term, means so written, displayed, or
2presented that a reasonable person against which it is to operate ought to have
3noticed it. Whether a term is "conspicuous" or not is a decision for the court.
4Conspicuous terms include any of the following:
AB480-ASA1,7,65
1. A heading in capitals equal to or greater in size than the surrounding text,
6or in contrasting type, font, or color to the surrounding text of the same or lesser size.
AB480-ASA1,7,107
2. Language in the body of a record or display in larger type than the
8surrounding text, or in contrasting type, font, or color to the surrounding text of the
9same size, or set off from surrounding text of the same size by symbols or other marks
10that call attention to the language.
AB480-ASA1,7,1211
(fm) "Consumer" means an individual who enters into a transaction primarily
12for personal, family, or household purposes.