409.408(1)
(1)
Term restricting assignment generally ineffective. Except as otherwise provided in
sub. (2), a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible, is ineffective to the extent that the term:
409.408(1)(a)
(a) Would impair the creation, attachment, or perfection of a security interest; or
409.408(1)(b)
(b) Provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible.
409.408(2)
(2) Applicability of sub. (1) to sales of certain rights to payment. Subsection (1) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note.
409.408(3)
(3) Legal restrictions on assignment generally ineffective. A rule of law, statute, or rule that prohibits, restricts, or requires the consent of a government, governmental body or official, person obligated on a promissory note or account debtor to the assignment or transfer of, or creation of a security interest in, a promissory note, health-care-insurance receivable, or general intangible, including a contract, permit, license, or franchise between an account debtor and a debtor, is ineffective to the extent that the rule of law, statute, or rule:
409.408(3)(a)
(a) Would impair the creation, attachment, or perfection of a security interest; or
409.408(3)(b)
(b) Provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible.
409.408(4)
(4) Limitation on ineffectiveness under subs. (1) and (3). To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable, or general intangible or a rule of law, statute, or rule described in
sub. (3) would be effective under law other than this chapter but is ineffective under
sub. (1) or
(3), the creation, attachment, or perfection of a security interest in the promissory note, health-care-insurance receivable, or general intangible:
409.408(4)(a)
(a) Is not enforceable against the person obligated on the promissory note or the account debtor;
409.408(4)(b)
(b) Does not impose a duty or obligation on the person obligated on the promissory note or the account debtor;
409.408(4)(c)
(c) Does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party, or accept payment or performance from the secured party;
409.408(4)(d)
(d) Does not entitle the secured party to use or assign the debtor's rights under the promissory note, health-care-insurance receivable, or general intangible, including any related information or materials furnished to the debtor in the transaction giving rise to the promissory note, health-care-insurance receivable, or general intangible;
409.408(4)(e)
(e) Does not entitle the secured party to use, assign, possess, or have access to any trade secrets or confidential information of the person obligated on the promissory note or the account debtor; and
409.408(4)(f)
(f) Does not entitle the secured party to enforce the security interest in the promissory note, health-care-insurance receivable, or general intangible.
409.408 History
History: 2001 a. 10.
409.409
409.409
Restrictions on assignment of letter-of-credit rights ineffective. 409.409(1)
(1)
Term or law restricting assignment generally ineffective. A term in a letter of credit or a rule of law, statute, rule, custom, or practice applicable to the letter of credit which prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary's assignment of or creation of a security interest in a letter-of-credit right is ineffective to the extent that the term or rule of law, statute, rule, custom, or practice:
409.409(1)(a)
(a) Would impair the creation, attachment, or perfection of a security interest in the letter-of-credit right; or
409.409(1)(b)
(b) Provides that the assignment or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the letter-of-credit right.
409.409(2)
(2) Limitation on ineffectiveness under sub. (1). To the extent that a term in a letter of credit is ineffective under
sub. (1) but would be effective under law other than this chapter or a custom or practice applicable to the letter of credit, to the transfer of a right to draw or otherwise demand performance under the letter of credit, or to the assignment of a right to proceeds of the letter of credit, the creation, attachment, or perfection of a security interest in the letter-of-credit right:
409.409(2)(a)
(a) Is not enforceable against the applicant, issuer, nominated person, or transferee beneficiary;
409.409(2)(b)
(b) Imposes no duties or obligations on the applicant, issuer, nominated person, or transferee beneficiary; and
409.409(2)(c)
(c) Does not require the applicant, issuer, nominated person, or transferee beneficiary to recognize the security interest, pay or render performance to the secured party, or accept payment or other performance from the secured party.
409.409 History
History: 2001 a. 10.
FILING
409.501(1)(1)
Filing offices. Except as otherwise provided in
sub. (2), if the local law of this state governs perfection of a security interest or agricultural lien, the office in which to file a financing statement to perfect the security interest or agricultural lien is:
409.501(1)(a)
(a) The office designated for the filing or recording of a record of a mortgage on the related real property, if:
409.501(1)(a)1.
1. The collateral is as-extracted collateral or timber to be cut; or
409.501(1)(a)2.
2. The financing statement is filed as a fixture filing and the collateral is goods that are or are to become fixtures; or
409.501(1)(b)
(b) The office of the department of financial institutions or any office duly authorized by the department, in all other cases, including a case in which the collateral is goods that are or are to become fixtures and the financing statement is not filed as a fixture filing.
409.501(2)
(2) Filing office for transmitting utilities. The office in which to file a financing statement to perfect a security interest in collateral, including fixtures, of a transmitting utility is the office of the department of financial institutions. The financing statement also constitutes a fixture filing as to the collateral indicated in the financing statement which is or is to become fixtures.
409.501 History
History: 2001 a. 10.
409.502
409.502
Contents of financing statement; record of mortgage as financing statement; time of filing financing statement. 409.502(1)(1)
Sufficiency of financing statement. Subject to
sub. (2), a financing statement is sufficient only if it:
409.502(1)(b)
(b) Provides the name of the secured party or a representative of the secured party; and
409.502(1)(c)
(c) Indicates the collateral covered by the financing statement.
409.502(2)
(2) Real-property-related financing statements. Except as otherwise provided in
s. 409.501 (2), to be sufficient, a financing statement that covers as-extracted collateral or timber to be cut, or which is filed as a fixture filing and covers goods that are or are to become fixtures, must satisfy
sub. (1) and also:
409.502(2)(a)
(a) Indicate that it covers this type of collateral;
409.502(2)(b)
(b) Indicate that it is to be filed for record in the real property records;
409.502(2)(c)
(c) Provide a description of the real property to which the collateral is related sufficient to give constructive notice of a mortgage under the law of this state if the description were contained in a record of the mortgage of the real property; and
409.502(2)(d)
(d) If the debtor does not have an interest of record in the real property, provide the name of a record owner.
409.502(3)
(3) Record of mortgage as financing statement. A record of a mortgage is effective, from the date of recording, as a financing statement filed as a fixture filing or as a financing statement covering as-extracted collateral or timber to be cut only if:
409.502(3)(a)
(a) The record indicates the goods or accounts that it covers;
409.502(3)(b)
(b) The goods are or are to become fixtures related to the real property described in the record or the collateral is related to the real property described in the record and is as-extracted collateral or timber to be cut;
409.502(3)(c)
(c) The record satisfies the requirements for a financing statement in this section other than an indication that it is to be filed in the real property records; and
409.502(4)
(4) Filing before security agreement or attachment. A financing statement may be filed before a security agreement is made or a security interest otherwise attaches.
409.502 History
History: 2001 a. 10.
409.502 Annotation
Financing Statements Under Revised UCC Article 9. Ireland. Wis. Law. Aug. 2001.
409.503
409.503
Name of debtor and secured party. 409.503(1)
(1)
Sufficiency of debtor's name. A financing statement sufficiently provides the name of the debtor:
409.503(1)(a)
(a) If the debtor is a registered organization, only if the financing statement provides the name of the debtor indicated on the public record of the debtor's jurisdiction of organization which shows the debtor to have been organized;
409.503(1)(b)
(b) If the debtor is a decedent's estate, only if the financing statement provides the name of the decedent and indicates that the debtor is an estate;
409.503(1)(c)
(c) If the debtor is a trust or a trustee acting with respect to property held in trust, only if the financing statement:
409.503(1)(c)1.
1. Provides the name specified for the trust in its organic documents or, if no name is specified, provides the name of the settlor and additional information sufficient to distinguish the debtor from other trusts having one or more of the same settlors; and
409.503(1)(c)2.
2. Indicates, in the debtor's name or otherwise, that the debtor is a trust or is a trustee acting with respect to property held in trust; and
409.503(1)(d)1.
1. If the debtor has a name, only if it provides the individual or organizational name of the debtor; and
409.503(1)(d)2.
2. If the debtor does not have a name, only if it provides the names of the partners, members, associates, or other persons comprising the debtor.
409.503(2)
(2) Additional debtor-related information. A financing statement that provides the name of the debtor in accordance with
sub. (1) is not rendered ineffective by the absence of:
409.503(2)(b)
(b) Unless required under
sub. (1) (d) 2., names of partners, members, associates, or other persons comprising the debtor.
409.503(3)
(3) Debtor's trade name insufficient. A financing statement that provides only the debtor's trade name does not sufficiently provide the name of the debtor.
409.503(4)
(4) Representative capacity. Failure to indicate the representative capacity of a secured party or representative of a secured party does not affect the sufficiency of a financing statement.
409.503(5)
(5) Multiple debtors and secured parties. A financing statement may provide the name of more than one debtor and the name of more than one secured party.
409.503 History
History: 2001 a. 10.
409.503 Annotation
A creditor's financing statement became "seriously misleading" after the debtors' name change and so was insufficient to perfect a security interest in property acquired more than 4 months after the name change. First Agri Services, Inc. v. Kahl,
129 Wis. 2d 464,
385 N.W.2d 191 (Ct. App. 1986).
409.503 Note
NOTE: The above annotated materials cite to the pre-
2001 Wis. Act 10 version of ch. 409.
409.504
409.504
Indication of collateral. A financing statement sufficiently indicates the collateral that it covers if the financing statement provides:
409.504(2)
(2) An indication that the financing statement covers all assets or all personal property.
409.504 History
History: 2001 a. 10.
409.505
409.505
Filing and compliance with other statutes and treaties for consignments, leases, other bailments, and other transactions. 409.505(1)(1)
Use of terms other than debtor and secured party. A consignor, lessor, or other bailor of goods, a licensor, or a buyer of a payment intangible or promissory note may file a financing statement, or may comply with a statute or treaty described in
s. 409.311 (1), using the terms "consignor", "consignee", "lessor", "lessee", "bailor", "bailee", "licensor", "licensee", "owner", "registered owner", "buyer", "seller", or words of similar import, instead of the terms "secured party" and "debtor".
409.505(2)
(2) Effect of financing statement under sub. (1). This subchapter applies to the filing of a financing statement under
sub. (1) and, as appropriate, to compliance that is equivalent to filing a financing statement under
s. 409.311 (2), but the filing or compliance is not of itself a factor in determining whether the collateral secures an obligation. If it is determined for another reason that the collateral secures an obligation, a security interest held by the consignor, lessor, bailor, licensor, owner, or buyer which attaches to the collateral is perfected by the filing or compliance
409.505 History
History: 2001 a. 10.
409.506
409.506
Effect of errors or omissions. 409.506(1)
(1)
Minor errors and omissions. A financing statement substantially satisfying the requirements of this subchapter is effective, even if it has minor errors or omissions, unless the errors or omissions make the financing statement seriously misleading.
409.506(2)
(2) Financing statement seriously misleading. Except as otherwise provided in
sub. (3), a financing statement that fails sufficiently to provide the name of the debtor in accordance with
s. 409.503 (1) is seriously misleading.
409.506(3)
(3) Financing statement not seriously misleading. If a search of the records of the filing office under the debtor's correct name, using the filing office's standard search logic, if any, would disclose a financing statement that fails sufficiently to provide the name of the debtor in accordance with
s. 409.503 (1), the name provided does not make the financing statement seriously misleading.
409.506(4)
(4) Debtor's correct name. For purposes of
s. 409.508 (2), the "debtor's correct name" in
sub. (3) means the correct name of the new debtor.
409.506 History
History: 2001 a. 10.
409.506 Annotation
A creditor's financing statement became "seriously misleading" after the debtors' name change and so was insufficient to perfect a security interest in property acquired more than 4 months after the name change. First Agri Services, Inc. v. Kahl,
129 Wis. 2d 464,
385 N.W.2d 191 (Ct. App. 1986).
409.506 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 662,
557 N.W.2d 865 (Ct. App. 1996).
409.506 Note
NOTE: The above annotated materials cite to the pre-
2001 Wis. Act 10 version of ch. 409.
409.507
409.507
Effect of certain events on effectiveness of financing statement.
