AB480: Bill Text

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB480, s. 1 Section 1. 59.43 (1) (L) of the statutes is amended to read:

AB480,2,6 59.43 (1) (L) File all documents pertaining to security interests, as defined in s. 401.201 (37) (a) (2) (t), that are required or authorized by law to be filed with the register. Except as otherwise prescribed by the department of financial institutions under subch. V of ch. 409, these documents shall be executed in a manner that satisfies the requirements set forth in sub. (2m) (b) 1. to 5.

AB480, s. 2 Section 2. 59.43 (1) (n) of the statutes is amended to read:

AB480,2,11 59.43 (1) (n) Upon the filing of a financing statement or other document evidencing the creation of a security interest, as defined in s. 401.201 (37) (a) (2) (t), required to be filed or recorded with the register under s. 409.501 (1) (a), index the statement or document in the real estate records index under sub. (9).

AB480, s. 3 Section 3. 126.25 (11) of the statutes is amended to read:

AB480,2,14 126.25 (11) "Warehouse receipt" means a receipt for grain, issued by a grain warehouse keeper, that is also a document of title under s. 401.201 (15) (2) (i).

AB480, s. 4 Section 4. 137.12 (2) (b) of the statutes is amended to read:

AB480,2,17 137.12 (2) (b) Chapters 401 and 403 to 410, other than ss. 401.107 and 401.206 s. 401.306.

AB480, s. 5 Section 5. 137.24 (4) of the statutes is amended to read:

AB480,3,8 137.24 (4) Except as otherwise agreed, a person having control of a transferable record is the holder, as defined in s. 401.201 (20) (2) (km), of the transferable record and has the same rights and defenses as a holder of an equivalent record or writing under chs. 401 to 411, including, if the applicable statutory requirements under s. 403.302 (1), 407.501, or 409.330 are satisfied, the rights and defenses of a holder in due course, a holder to which a negotiable record of title has been duly negotiated, or a purchaser, respectively. Delivery, possession, and endorsement are not required to obtain or exercise any of the rights under this subsection.

AB480, s. 6 Section 6. 340.01 (56o) of the statutes is amended to read:

AB480,3,11 340.01 (56o) "Security interest" means a security interest as defined in s. 401.201 (37) (2) (t).

AB480, s. 7 Section 7. 342.03 of the statutes is amended to read:

AB480,3,18 342.03 Motor vehicle, trailer or semitrailer leases. Notwithstanding s. 401.201 (37) (2) (t) or ch. 409, a transaction involving a motor vehicle, trailer or semitrailer does not create a conditional sale or a security interest merely because it includes a provision that permits or requires the rental price to be adjusted under the agreement by reference to the amount realized upon the sale or other disposition of the motor vehicle, trailer or semitrailer.

AB480, s. 8 Section 8. Chapter 401 of the statutes is repealed and recreated to read:

AB480,3,20 CHAPTER 401

AB480,3,21 Uniform commercial code

AB480,3,22 — General provisions

AB480,3,23 Subchapter I

AB480,3,24 General provisions

AB480,4,2 401.101 Short titles. (1) Chapters 401 to 411 may be cited as the uniform commercial code.

AB480,4,4 (2) This chapter may be cited as uniform commercial code — general provisions.

AB480,4,6 401.102 Scope of chapter. This chapter applies to a transaction to the extent that it is governed by another chapter in chs. 402 to 411.

AB480,4,10 401.103 Construction of uniform commercial code to promote its purposes and policies; applicability of supplemental principles of law. (1) Chapters 401 to 411 must be liberally construed and applied to promote its underlying purposes and policies, which are all of the following:

AB480,4,12 (a) To simplify, clarify, and modernize the law governing commercial transactions.

AB480,4,14 (b) To permit the continued expansion of commercial practices through custom, usage, and agreement of the parties.

AB480,4,15 (c) To make uniform the law among the various jurisdictions.

AB480,4,20 (2) Unless displaced by the particular provisions of chs. 401 to 411, the principles of law and equity, including the law merchant and the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, or other validating or invalidating cause shall supplement its provisions.

AB480,4,24 401.104 Construction against implied repeal. Chapters 401 to 411 being a general act intended as a unified coverage of its subject matter, no part of it shall be deemed to be impliedly repealed by subsequent legislation if such construction can reasonably be avoided.

AB480,5,2 401.106 Use of singular and plural; gender. In chs. 401 to 411, unless the statutory context otherwise requires, all of the following apply:

AB480,5,4 (1) Words in the singular number include the plural, and those in the plural include the singular.

AB480,5,5 (2) Words of any gender also refer to any other gender.

AB480,5,7 401.107 Captions. Section captions are part of chs. 401 to 411, notwithstanding s. 990.001 (6).

AB480,5,8 Subchapter Ii

AB480,5,10 GENERAL DEFINITIONS AND PRINCIPLES OF INTERPRETATION

AB480,5,14 401.201 General definitions. (1) Unless the context otherwise requires, words or phrases defined in this section, or in the additional definitions contained in chs. 402 to 411 that apply to particular chapters or subchapters thereof, have the meanings stated.

AB480,5,16 (2) Subject to definitions contained in chs. 402 to 411 that apply to particular chapters or subchapters thereof, in chs. 401 to 411:

AB480,5,19 (a) "Action," in the sense of a judicial proceeding, includes recoupment, counterclaim, setoff, suit in equity, and any other proceeding in which rights are determined.

AB480,5,20 (am) "Aggrieved party" means a party entitled to pursue a remedy.

AB480,5,23 (b) "Agreement" means the bargain of the parties in fact, as found in their language or inferred from other circumstances, including course of performance, course of dealing, or usage of trade as provided in s. 401.303. (Compare "Contract.")

AB480,5,25 (c) "Bank" means a person engaged in the business of banking and includes a savings bank, savings and loan association, credit union, and trust company.

AB480,6,3 (cm) "Bearer" means a person in possession of a negotiable instrument, document of title, or certificated security that is payable to bearer or endorsed in blank.

AB480,6,6 (d) "Bill of lading" means a document evidencing the receipt of goods for shipment issued by a person engaged in the business of transporting or forwarding goods.

AB480,6,7 (dm) "Branch" includes a separately incorporated foreign branch of a bank.

AB480,6,9 (e) "Burden of establishing" a fact means the burden of persuading the trier of fact that the existence of the fact is more probable than its nonexistence.

AB480,6,24 (em) "Buyer in ordinary course of business" means a person that buys goods in good faith, without knowledge that the sale violates the rights of another person in the goods, and in the ordinary course from a person, other than a pawnbroker, in the business of selling goods of that kind. A person buys goods in the ordinary course if the sale to the person comports with the usual or customary practices in the kind of business in which the seller is engaged or with the seller's own usual or customary practices. A person that sells oil, gas, or other minerals at the wellhead or minehead is a person in the business of selling goods of that kind. A buyer in ordinary course of business may buy for cash, by exchange of other property, or on secured or unsecured credit, and may acquire goods or documents of title under a preexisting contract for sale. Only a buyer that takes possession of the goods or has a right to recover the goods from the seller under ch. 402 may be a buyer in ordinary course of business. A person that acquires goods in a transfer in bulk or as security for or in total or partial satisfaction of a money debt is not a buyer in ordinary course of business.

AB480,7,4 (f) "Conspicuous," with reference to a term, means so written, displayed, or presented that a reasonable person against which it is to operate ought to have noticed it. Whether a term is "conspicuous" or not is a decision for the court. Conspicuous terms include any of the following:

AB480,7,6 1. A heading in capitals equal to or greater in size than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same or lesser size.

AB480,7,10 2. Language in the body of a record or display in larger type than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same size, or set off from surrounding text of the same size by symbols or other marks that call attention to the language.

AB480,7,12 (fm) "Consumer" means an individual who enters into a transaction primarily for personal, family, or household purposes.

AB480,7,15 (g) "Contract" means the total legal obligation that results from the parties' agreement as determined by chs. 401 to 411 as supplemented by any other applicable laws. (Compare "Agreement.")

AB480,7,19 (gm) "Creditor" includes a general creditor, a secured creditor, a lien creditor, and any representative of creditors, including an assignee for the benefit of creditors, a trustee in bankruptcy, a receiver in equity, and an executor or administrator of an insolvent debtor's or assignor's estate.

AB480,7,21 (h) "Defendant" includes a person in the position of defendant in a counterclaim or 3rd party claim.

AB480,7,23 (hm) "Delivery," with respect to an instrument, document of title, or chattel paper, means voluntary transfer of possession.

AB480,8,5 (i) "Document of title" includes bill of lading, dock warrant, dock receipt, warehouse receipt or order for the delivery of goods, and any other document which in the regular course of business or financing is treated as adequately evidencing that the person in possession of it is entitled to receive, hold, and dispose of the document and the goods it covers. To be a document of title, a document must purport to be issued by or addressed to a bailee and purport to cover goods in the bailee's possession which are either identified or are fungible portions of an identified mass.

AB480,8,6 (im) "Fault" means a wrongful act, omission, breach, or default.

AB480,8,7 (j) "Fungible goods" means any of the following:

AB480,8,9 1. Goods of which any unit, by nature or usage of trade, is the equivalent of any other like unit.

AB480,8,10 2. Goods which by agreement are treated as equivalent.

AB480,8,11 (jm) "Genuine" means free of forgery or counterfeiting.

AB480,8,13 (k) "Good faith," except as otherwise provided in ch. 405, means honesty in fact and the observance of reasonable commercial standards of fair dealing.

AB480,8,14 (km) "Holder" means any of the following:

AB480,8,16 1. The person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession.

AB480,8,18 2. A person in possession of a document of title if the goods are deliverable either to bearer or to the order of the person in possession.

AB480,8,21 (L) "Insolvency proceeding" includes an assignment for the benefit of creditors or other proceeding intended to liquidate or rehabilitate the estate of the person involved.

AB480,8,22 (Lm) "Insolvent" means any of the following:

AB480,8,24 1. Having generally ceased to pay debts in the ordinary course of business other than as a result of bona fide dispute.

AB480,8,25 2. Unable to pay debts as they become due.

AB480,9,1 3. Insolvent within the meaning of federal bankruptcy law.

AB480,9,5 (m) "Money" means a medium of exchange currently authorized or adopted by a domestic or foreign government. The term includes a monetary unit of account established by an intergovernmental organization or by agreement between 2 or more countries.

AB480,9,6 (mm) "Organization" means a person other than an individual.

AB480,9,8 (n) "Party," as distinct from a "3rd party," means a person that has engaged in a transaction or made an agreement subject to chs. 401 to 411.

AB480,9,12 (nm) "Person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency, or instrumentality, public corporation, or any other legal or commercial entity.

AB480,9,18 (p) "Present value" means the amount as of a date certain of one or more sums payable in the future, discounted to the date certain by use of either an interest rate specified by the parties if that rate is not manifestly unreasonable at the time the transaction is entered into or, if an interest rate is not so specified, a commercially reasonable rate that takes into account the facts and circumstances at the time the transaction is entered into.

AB480,9,21 (pm) "Presumption" or "presumed" means that the trier of fact must find the existence of the fact presumed unless and until evidence is introduced which would support a finding of its nonexistence.

AB480,9,24 (q) "Purchase" means taking by sale, lease, discount, negotiation, mortgage, pledge, lien, security interest, issue or reissue, gift, or any other voluntary transaction creating an interest in property.

AB480,9,25 (qm) "Purchaser" means a person that takes by purchase.

AB480,10,2 (r) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

AB480,10,4 (rm) "Remedy" means any remedial right to which an aggrieved party is entitled with or without resort to a tribunal.

AB480,10,7 (s) "Representative" means any person empowered to act for another, including an agent, an officer of a corporation or association, and a trustee, executor, or administrator of an estate.

AB480,10,8 (sm) "Right" includes remedy.

AB480,10,21 (t) "Security interest" means an interest in personal property or fixtures which secures payment or performance of an obligation. The term also includes any interest of a consignor and a buyer of accounts, chattel paper, a payment intangible, or a promissory note in a transaction that is subject to ch. 409. The special property interest of a buyer of goods on identification of those goods to a contract for sale under s. 402.401 is not a "security interest," but a buyer may also acquire a "security interest" by complying with ch. 409. Except as otherwise provided in s. 402.505, the right of a seller or lessor of goods under ch. 402 or 411 to retain or acquire possession of the goods is not a "security interest," but a seller or lessor may also acquire a "security interest" by complying with ch. 409. The retention or reservation of title by a seller of goods notwithstanding shipment or delivery to the buyer (s. 402.401) is limited in effect to a reservation of a "security interest." Whether a transaction in the form of a lease creates a "security interest" is determined pursuant to s. 401.203.

AB480,10,23 (tm) "Send" in connection with a writing, record, or notice means any of the following:

AB480,11,3 1. To deposit in the mail or deliver for transmission by any other usual means of communication with postage or cost of transmission provided for and properly addressed and, in the case of an instrument, to an address specified thereon or otherwise agreed, or if there be none to any address reasonable under the circumstances.

AB480,11,5 2. In any other way to cause to be received any record or notice within the time it would have arrived if properly sent.

AB480,11,7 (u) "Signed" includes any symbol executed or adopted with present intention to adopt or accept a writing.

AB480,11,10 (um) "State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States.