409.103(4)
(4) Consignor's inventory purchase-money security interest. The security interest of a consignor in goods that are the subject of a consignment is a purchase-money security interest in inventory.
409.103(5)
(5) Application of payment in nonconsumer-goods transaction. In a transaction other than a consumer-goods transaction, if the extent to which a security interest is a purchase-money security interest depends on the application of a payment to a particular obligation, the payment must be applied:
409.103(5)(a)
(a) In accordance with any reasonable method of application to which the parties agree;
409.103(5)(b)
(b) In the absence of the parties' agreement to a reasonable method, in accordance with any intention of the obligor manifested at or before the time of payment; or
409.103(5)(c)
(c) In the absence of an agreement to a reasonable method and a timely manifestation of the obligor's intention, in the following order:
409.103(5)(c)2.
2. If more than one obligation is secured, to obligations secured by purchase-money security interests in the order in which those obligations were incurred.
409.103(6)
(6) No loss of status of purchase-money security interest in nonconsumer-goods transaction. In a transaction other than a consumer-goods transaction, a purchase-money security interest does not lose its status as such, even if:
409.103(6)(a)
(a) The purchase-money collateral also secures an obligation that is not a purchase-money obligation;
409.103(6)(b)
(b) Collateral that is not purchase-money collateral also secures the purchase-money obligation; or
409.103(6)(c)
(c) The purchase-money obligation has been renewed, refinanced, consolidated, or restructured.
409.103(7)
(7) Burden of proof in nonconsumer-goods transaction. In a transaction other than a consumer-goods transaction, a secured party claiming a purchase-money security interest has the burden of establishing the extent to which the security interest is a purchase-money security interest.
409.103(8)
(8) Nonconsumer-goods transactions; no inference. The limitation of the rules in
subs. (5) to
(7) to transactions other than consumer-goods transactions is intended to leave to the court the determination of the proper rules in consumer-goods transactions. The court may not infer from that limitation the nature of the proper rule in consumer-goods transactions and may continue to apply established approaches.
409.103 History
History: 2001 a. 10.
409.1035
409.1035
Production-money crops; production-money obligation; production-money security interest; burden of establishing. 409.1035(1)
(1) A security interest in crops is a production-money security interest to the extent that the crops are production-money crops.
409.1035(2)
(2) If the extent to which a security interest is a production-money security interest depends on the application of a payment to a particular obligation, the payment must be applied in the following order until fully applied:
409.1035(2)(a)
(a) First, to all production-money obligations secured by production-money crops, in the order in which those obligations were incurred;
409.1035(2)(b)
(b) Second, to all obligations secured by conflicting security interests in the production-money crops referred to in
par. (a), in the order in which those obligations were incurred; and
409.1035(2)(c)
(c) Third, to all unsecured obligations of the debtor making the payment, in the order in which those obligations were incurred.
409.1035(3)
(3) A production-money security interest does not lose its status as such, even if:
409.1035(3)(a)
(a) The production-money crops also secure an obligation that is not a production-money obligation;
409.1035(3)(b)
(b) Collateral that is not production-money crops also secures the production-money obligation; or
409.1035(3)(c)
(c) The production-money obligation has been renewed, refinanced, or restructured.
409.1035(4)
(4) A secured party claiming a production-money security interest has the burden of establishing the extent to which the security interest is a production-money security interest.
409.1035(6)
(6) A person may not claim a purchase-money security interest in crops grown, growing, or to be grown.
409.1035 History
History: 2001 a. 10.
409.104
409.104
Control of deposit account. 409.104(1)
(1)
Requirements for control. A secured party has control of a deposit account if:
409.104(1)(a)
(a) The secured party is the bank with which the deposit account is maintained;
409.104(1)(b)
(b) The debtor, secured party, and bank have agreed in an authenticated record that the bank will comply with instructions originated by the secured party directing disposition of the funds in the deposit account without further consent by the debtor; or
409.104(1)(c)
(c) The secured party becomes the bank's customer with respect to the deposit account.
409.104(2)
(2) Debtor's right to direct disposition. A secured party that has satisfied
sub. (1) has control, even if the debtor retains the right to direct the disposition of funds from the deposit account.
409.104 History
History: 2001 a. 10.
409.105
409.105
Control of electronic chattel paper. 409.105(1m)
(1m)
General rule: control of electronic chattel paper. A secured party has control of electronic chattel paper if a system employed for evidencing the transfer of interests in the chattel paper reliably establishes the secured party as the person to which the chattel paper was assigned.
409.105(2m)
(2m) Specific facts giving control. Without limiting the generality of
sub. (1m), a system satisfies
sub. (1m) if the record or records comprising the chattel paper are created, stored, and assigned in such a manner that:
409.105(2m)(a)
(a) A single authoritative copy of the record or records exists which is unique, identifiable, and, except as otherwise provided in
pars. (d) to
(f), unalterable;
409.105(2m)(b)
(b) The authoritative copy identifies the secured party as the assignee of the record or records;
409.105(2m)(c)
(c) The authoritative copy is communicated to and maintained by the secured party or its designated custodian;
409.105(2m)(d)
(d) Copies or amendments that add or change an identified assignee of the authoritative copy can be made only with the consent of the secured party;
409.105(2m)(e)
(e) Each copy of the authoritative copy and any copy of a copy is readily identifiable as a copy that is not the authoritative copy; and
409.105(2m)(f)
(f) Any amendment of the authoritative copy is readily identifiable as authorized or unauthorized.
409.105 History
History: 2001 a. 10,
416;
2011 a. 206.
409.106
409.106
Control of investment property. 409.106(1)
(1)
Control under s. 408.106. A person has control of a certificated security, uncertificated security, or security entitlement as provided in
s. 408.106.
409.106(2)
(2) Control of commodity contract. A secured party has control of a commodity contract if:
409.106(2)(a)
(a) The secured party is the commodity intermediary with which the commodity contract is carried; or
409.106(2)(b)
(b) The commodity customer, secured party, and commodity intermediary have agreed that the commodity intermediary will apply any value distributed on account of the commodity contract as directed by the secured party without further consent by the commodity customer.
409.106(3)
(3) Effect of control of securities account or commodity account. A secured party having control of all security entitlements or commodity contracts carried in a securities account or commodity account has control over the securities account or commodity account.
409.106 History
History: 2001 a. 10.
409.107
409.107
Control of letter-of-credit right. A secured party has control of a letter-of-credit right to the extent of any right to payment or performance by the issuer or any nominated person if the issuer or nominated person has consented to an assignment of proceeds of the letter of credit under
ch. 405 or otherwise applicable law or practice.
409.107 History
History: 2001 a. 10.
409.108
409.108
Sufficiency of description. 409.108(1)
(1)
Sufficiency of description. Except as otherwise provided in
subs. (3) to
(5), a description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
409.108(2)
(2) Examples of reasonable identification. Except as otherwise provided in
sub. (4), a description of collateral reasonably identifies the collateral if it identifies the collateral by:
409.108(2)(e)
(e) Computational or allocational formula or procedure; or
409.108(2)(f)
(f) Except as otherwise provided in
sub. (3), any other method, if the identity of the collateral is objectively determinable.
409.108(3)
(3) Supergeneric description not sufficient. A description of collateral as "all the debtor's assets" or "all the debtor's personal property" or using words of similar import does not reasonably identify the collateral.
409.108(4)
(4) Investment property. Except as otherwise provided in
sub. (5), a description of a security entitlement, securities account, or commodity account is sufficient if it describes:
409.108(4)(a)
(a) The collateral by those terms or as investment property; or
409.108(4)(b)
(b) The underlying financial asset or commodity contract.
409.108(5)
(5) When description by type insufficient. A description only by type of collateral defined in
chs. 401 to
411 is an insufficient description of:
409.108(5)(b)
(b) In a consumer transaction, consumer goods, a security entitlement, a securities account, or a commodity account.
409.108 History
History: 2001 a. 10.
409.108 Annotation
A wrong statement of section, township, range, and county where crops were grown was not minor, and, without directing further inquiry, was insufficient. Whether a party is misled by the description is not part of the inquiry under s. 409.110 or 409.402. Smith & Spindahl Enterprises, Inc. v. Lee,
206 Wis. 2d 663,
557 N.W.2d 865 (Ct. App. 1996),
96-0882.
409.108 Note
NOTE: The above annotated materials cite to the pre-
2001 Wis. Act 10 version of ch. 409.
409.109(1)(1)
General scope of chapter. Except as otherwise provided in
subs. (3) and
(4), and
s. 16.63 (4) on transactions involving tobacco settlement revenues, this chapter applies to:
409.109(1)(a)
(a) A transaction, regardless of its form, that creates a security interest in personal property or fixtures by contract;
409.109(1)(c)
(c) A sale of accounts, chattel paper, payment intangibles, or promissory notes;
409.109(2)
(2) Security interest in secured obligation. 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.
409.109(3)
(3) Extent to which chapter does not apply. This chapter does not apply to the extent that:
409.109(3)(a)
(a) A statute, regulation, or treaty of the United States preempts this chapter;
409.109(3)(b)
(b) Another statute of this state expressly governs the creation, perfection, priority, or enforcement of a security interest created by this state or a governmental unit of this state;
409.109(3)(c)
(c) A statute of another state, a foreign country, or a governmental unit of another state or a foreign country, other than a statute generally applicable to security interests, expressly governs creation, perfection, priority, or enforcement of a security interest created by the state, country, or governmental unit; or
409.109(3)(d)
(d) The rights of a transferee beneficiary or nominated person under a letter of credit are independent and superior under
ch. 405.
409.109(4)
(4) Inapplicability of chapter. This chapter does not apply to:
409.109(4)(a)
(a) A landlord's lien, other than an agricultural lien;
