71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
Enrolled
Senate Bill 171
Printed pursuant to Senate Interim Rule 213.28 by order of the
President of the Senate in conformance with presession filing
rules, indicating neither advocacy nor opposition on the part
of the President (at the request of Joint Interim Judiciary
Committee for Oregon Bankers Association and Oregon State Bar)
CHAPTER ................
AN ACT
Relating to secured transactions; creating new provisions;
amending ORS 29.205, 56.041, 71.1010, 71.1050, 71.2010,
72.1030, 72.2100, 72.3260, 72.4010, 72.4020, 72.4030, 72.5020,
72.7160, 72.8010, 72A.1030, 72A.3030, 72A.3070, 72A.3090,
72A.3095, 74.2100, 77.2090, 77.5030, 78.1030, 78.1060, 78.1100,
78.3010, 78.3020, 78.5100, 79.8010, 83.610, 87.322, 87.755,
87.816, 90.425, 93.806, 95.270, 192.440, 205.246, 283.089,
285B.050, 305.182, 305.184, 353.380, 471.292, 547.510, 646.551,
657.394, 657.542, 708A.535, 722.264, 725.360, 725.910, 803.015,
803.097 and 830.740 and section 9, chapter 249, Oregon Laws
2001 (Enrolled House Bill 2386), and ORCP 81 A; repealing ORS
79.1010, 79.1020, 79.1030, 79.1040, 79.1050, 79.1060, 79.1070,
79.1080, 79.1090, 79.1100, 79.1120, 79.1130, 79.1150, 79.1160,
79.2010, 79.2020, 79.2030, 79.2040, 79.2050, 79.2060, 79.2070,
79.2080, 79.3010, 79.3015, 79.3020, 79.3030, 79.3040, 79.3050,
79.3060, 79.3070, 79.3080, 79.3090, 79.3100, 79.3110, 79.3120,
79.3130, 79.3132, 79.3140, 79.3150, 79.3160, 79.3170, 79.3180,
79.4010, 79.4016, 79.4020, 79.4023, 79.4025, 79.4030, 79.4040,
79.4050, 79.4060, 79.4070, 79.4080, 79.4090, 79.5010, 79.5020,
79.5030, 79.5040, 79.5050, 79.5060 and 79.5070; and declaring
an emergency.
Be It Enacted by the People of the State of Oregon:
{ +
GENERAL PROVISIONS + }
{ +
(Short Title, Definitions and General Concepts) + }
SECTION 1. { + 9-101. Short title. This chapter may be cited
as Uniform Commercial Code-Secured Transactions. + }
SECTION 2. { + 9-102. Definitions and index of definitions.
(1) As used 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.
(b) 'Account,' except as used in 'account for,' means a right
to payment of a monetary obligation, whether or not earned by
performance, (i) for property that has been or is to be sold,
Enrolled Senate Bill 171 (SB 171-ACCA) Page 1
leased, licensed, assigned, or otherwise disposed of, (ii) for
services rendered or to be rendered, (iii) for a policy of
insurance issued or to be issued, (iv) for a secondary obligation
incurred or to be incurred, (v) for energy provided or to be
provided, (vi) for the use or hire of a vessel under a charter or
other contract, (vii) arising out of the use of a credit or
charge card or information contained on or for use with the card,
or (viii) 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 (i)
rights to payment evidenced by chattel paper or an instrument,
(ii) commercial tort claims, (iii) deposit accounts, (iv)
investment property, (v) letter-of-credit rights or letters of
credit, or (vi) 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.
(c) '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.
(d) 'Accounting,' except as used in 'accounting for, ' means a
record:
(A) Authenticated by a secured party;
(B) 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
(C) Identifying the components of the obligations in reasonable
detail.
(e) 'Agricultural lien' means an interest, other than a
security interest or a lien created under ORS 87.226, 87.700 to
87.740 or 87.750 to 87.777, in farm products:
(A) Which secures payment or performance of an obligation for:
(i) Goods or services furnished in connection with a debtor's
farming operation; or
(ii) Rent on real property leased by a debtor in connection
with its farming operation;
(B) Which is created by statute in favor of a person that:
(i) In the ordinary course of its business furnished goods or
services to a debtor in connection with a debtor's farming
operation; or
(ii) Leased real property to a debtor in connection with the
debtor's farming operation; and
(C) Whose effectiveness does not depend on the person's
possession of the personal property.
(f) 'As-extracted collateral' means:
(A) Oil, gas or other minerals that are subject to a security
interest that:
(i) Is created by a debtor having an interest in the minerals
before extraction; and
(ii) Attaches to the minerals as extracted; or
(B) 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.
(g) 'Authenticate' means:
(A) To sign; or
(B) To execute or otherwise adopt a symbol, or encrypt or
similarly process a record in whole or in part, with the present
Enrolled Senate Bill 171 (SB 171-ACCA) Page 2
intent of the authenticating person to identify the person and
adopt or accept a record.
(h) '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.
(i) 'Cash proceeds' means proceeds that are money, checks,
deposit accounts or the like.
(j) '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.
(k) '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. In
this paragraph, 'monetary obligation' means a monetary obligation
secured by the goods or owed under a lease of the goods and
includes a monetary obligation with respect to software used in
the goods. The term does not include (i) charters or other
contracts involving the use or hire of a vessel or (ii) 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.
(L) 'Collateral' means the property subject to a security
interest or agricultural lien. The term includes:
(A) Proceeds to which a security interest attaches;
(B) Accounts, chattel paper, payment intangibles and promissory
notes that have been sold; and
(C) Goods that are the subject of a consignment.
(m) 'Commercial tort claim' means a claim arising in tort with
respect to which:
(A) The claimant is an organization; or
(B) The claimant is an individual and the claim:
(i) Arose in the course of the claimant's business or
profession; and
(ii) Does not include damages arising out of personal injury to
or the death of an individual.
(n) 'Commodity account' means an account maintained by a
commodity intermediary in which a commodity contract is carried
for a commodity customer.
(o) '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:
(A) 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
(B) 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.
(p) 'Commodity customer' means a person for which a commodity
intermediary carries a commodity contract on its books.
(q) 'Commodity intermediary' means a person that:
(A) Is registered as a futures commission merchant under
federal commodities law; or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 3
(B) In the ordinary course of its business provides clearance
or settlement services for a board of trade that has been
designated as a contract market pursuant to federal commodities
law.
(r) 'Communicate' means:
(A) To send a written or other tangible record;
(B) To transmit a record by any means agreed upon by the
persons sending and receiving the record; or
(C) In the case of transmission of a record to or by a filing
office, to transmit a record by any means prescribed by
filing-office rule.
(s) 'Consignee' means a merchant to which goods are delivered
in a consignment.
(t) 'Consignment' means a transaction, regardless of its form,
in which a person delivers goods to a merchant for the purpose of
sale and:
(A) The merchant:
(i) Deals in goods of that kind under a name other than the
name of the person making delivery;
(ii) Is not an auctioneer; and
(iii) Is not generally known by its creditors to be
substantially engaged in selling the goods of others;
(B) With respect to each delivery, the aggregate value of the
goods is $1,000 or more at the time of delivery;
(C) The goods are not consumer goods immediately before
delivery; and
(D) The transaction does not create a security interest that
secures an obligation.
(u) 'Consignor' means a person that delivers goods to a
consignee in a consignment.
(v) 'Consumer debtor' means a debtor in a consumer transaction.
(w) 'Consumer goods' means goods that are used or bought for
use primarily for personal, family or household purposes.
(x) 'Consumer-goods transaction' means a consumer transaction
in which:
(A) An individual incurs an obligation primarily for personal,
family or household purposes; and
(B) A security interest in consumer goods secures the
obligation.
(y) 'Consumer obligor' means an obligor who is an individual
and who incurred the obligation as part of a transaction entered
into primarily for personal, family or household purposes.
(z) 'Consumer transaction' means a transaction in which (i) an
individual incurs an obligation primarily for personal, family or
household purposes, (ii) a security interest secures the
obligation, and (iii) the collateral is held or acquired
primarily for personal, family or household purposes. The term
includes consumer-goods transactions.
(aa) 'Continuation statement' means an amendment of a financing
statement which:
(A) Identifies, by its file number, the initial financing
statement to which it relates; and
(B) Indicates that it is a continuation statement for, or that
it is filed to continue the effectiveness of, the identified
financing statement.
(bb) 'Debtor' means:
(A) A person having an interest, other than a security interest
or other lien, in the collateral, whether or not the person is an
obligor;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 4
(B) A seller of accounts, chattel paper, payment intangibles or
promissory notes; or
(C) A consignee.
(cc) 'Deposit account' means a demand, time, savings, passbook
or similar account maintained with a bank. The term does not
include investment property or accounts evidenced by an
instrument.
(dd) 'Document' means a document of title or a receipt of the
type described in ORS 77.2010 (2).
(ee) 'Electronic chattel paper' means chattel paper evidenced
by a record or records consisting of information stored in an
electronic medium.
(ff) 'Encumbrance' means a right, other than an ownership
interest, in real property. The term includes mortgages and other
liens on real property.
(gg) 'Equipment' means goods other than inventory, farm
products or consumer goods.
(hh) 'Farm products' means goods, other than standing timber,
with respect to which the debtor is engaged in a farming
operation and which are:
(A) Crops grown, growing, or to be grown, including:
(i) Crops produced on trees, vines and bushes; and
(ii) Aquatic goods produced in aquacultural operations;
(B) Livestock, born or unborn, including aquatic goods produced
in aquacultural operations;
(C) Supplies used or produced in a farming operation; or
(D) Products of crops or livestock in their unmanufactured
states.
(ii) 'Farming operation' means raising, cultivating,
propagating, fattening, grazing or any other farming, livestock
or aquacultural operation.
(jj) 'File number' means the number assigned to an initial
financing statement pursuant to section 90 (1) of this 2001 Act.
(kk) 'Filing office' means an office designated in section 72
of this 2001 Act as the place to file a financing statement.
(LL) 'Filing-office rule' means a rule adopted pursuant to
section 97 of this 2001 Act.
(mm) 'Financing statement' means a record or records composed
of an initial financing statement and any filed record relating
to the initial financing statement.
(nn) 'Fixture filing' means the filing of a financing statement
covering goods that are or are to become fixtures and satisfying
section 73 (1) and (2) of this 2001 Act. The term includes the
filing of a financing statement covering goods of a transmitting
utility which are or are to become fixtures.
(oo) 'Fixtures' means goods that have become so related to
particular real property that an interest in them arises under
real property law. The term does not include portable irrigation
equipment including movable pipe, pumps, electrical pump panels,
pump columns, electrical wire, wheel lines, center pivots and
handlines. The term includes domestic pumps, domestic pump wire,
domestic pump panels, domestic pump columns, and buried
irrigation equipment including buried pipe, buried electrical
wire and all buried well casings.
(pp) 'General intangible' means any personal property,
including things in action, other than accounts, chattel paper,
commercial tort claims, deposit accounts, documents, goods,
instruments, investment property, letter-of-credit rights,
letters of credit, money and oil, gas or other minerals before
extraction. The term includes payment intangibles and software.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 5
(qq) 'Good faith' means honesty in fact and the observance of
reasonable commercial standards of fair dealing.
(rr) 'Goods' means all things that are movable when a security
interest attaches. The term includes (i) fixtures, (ii) standing
timber that is to be cut and removed under a conveyance or
contract for sale, (iii) the unborn young of animals, (iv) crops
grown, growing or to be grown, even if the crops are produced on
trees, vines or bushes, and (v) manufactured homes. The term
also includes a computer program embedded in goods and any
supporting information provided in connection with a transaction
relating to the program if (i) the program is associated with the
goods in such a manner that it customarily is considered part of
the goods, or (ii) by becoming the owner of the goods, a person
acquires a right to use the program in connection with the goods.
The term does not include a computer program embedded in goods
that consist solely of the medium in which the program is
embedded. The term also does not include accounts, chattel paper,
commercial tort claims, deposit accounts, documents, general
intangibles, instruments, investment property, letter-of-credit
rights, letters of credit, money or oil, gas or other minerals
before extraction.
(ss) 'Governmental unit' means a subdivision, agency,
department, county, parish, municipality or other unit of the
government of the United States, a state or a foreign country.
The term includes an organization having a separate corporate
existence if the organization is eligible to issue debt on which
interest is exempt from income taxation under the laws of the
United States.
(tt) 'Health-care-insurance receivable' means an interest in or
claim under a policy of insurance which is a right to payment of
a monetary obligation for health-care goods or services provided.
(uu) 'Instrument' means a negotiable instrument or any other
writing that evidences a right to the payment of a monetary
obligation, is not itself a security agreement or lease, and is
of a type that in ordinary course of business is transferred by
delivery with any necessary indorsement or assignment. The term
does not include (i) investment property, (ii) letters of credit
or (iii) writings 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.
(vv) 'Inventory' means goods, other than farm products, which:
(A) Are leased by a person as lessor;
(B) Are held by a person for sale or lease or to be furnished
under a contract of service;
(C) Are furnished by a person under a contract of service; or
(D) Consist of raw materials, work in process, or materials
used or consumed in a business.
(ww) 'Investment property' means a security, whether
certificated or uncertificated, security entitlement, securities
account, commodity contract or commodity account.
(xx) 'Jurisdiction of organization,' with respect to a
registered organization, means the jurisdiction under whose law
the organization is organized.
(yy) 'Letter-of-credit right' means a right to payment or
performance under a letter of credit, whether or not the
beneficiary has demanded or is at the time entitled to demand
payment or performance. The term does not include the right of a
beneficiary to demand payment or performance under a letter of
credit.
(zz) 'Lien creditor' means:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 6
(A) A creditor that has acquired a lien on the property
involved by attachment, levy or the like;
(B) An assignee for benefit of creditors from the time of
assignment;
(C) A trustee in bankruptcy from the date of the filing of the
petition; or
(D) A receiver in equity from the time of appointment.
(aaa) 'Manufactured home' means a structure, transportable in
one or more sections, which, in the traveling mode, is eight body
feet or more in width or 40 body feet or more in length, or, when
erected on site, is 320 or more square feet, and which is built
on a permanent chassis and designed to be used as a dwelling with
or without a permanent foundation when connected to the required
utilities, and includes the plumbing, heating, air-conditioning
and electrical systems contained therein. The term includes any
structure that meets all of the requirements of this paragraph
except the size requirements and with respect to which the
manufacturer voluntarily files a certification required by the
United States Secretary of Housing and Urban Development and
complies with the standards established under Title 42 of the
United States Code.
(bbb) 'Manufactured-home transaction' means a secured
transaction:
(A) That creates a purchase-money security interest in a
manufactured home, other than a manufactured home held as
inventory; or
(B) In which a manufactured home, other than a manufactured
home held as inventory, is the primary collateral.
(ccc) 'Mortgage' means a consensual interest in real property,
including fixtures, which secures payment or performance of an
obligation.
(ddd) 'New debtor' means a person that becomes bound as debtor
under section 13 (4) of this 2001 Act by a security agreement
previously entered into by another person.
(eee) 'New value' means (i) money, (ii) money's worth in
property, services or new credit, or (iii) release by a
transferee of an interest in property previously transferred to
the transferee. The term does not include an obligation
substituted for another obligation.
(fff) 'Noncash proceeds' means proceeds other than cash
proceeds.
(ggg) 'Obligor' means a person that, with respect to an
obligation secured by a security interest in or an agricultural
lien on the collateral, (i) owes payment or other performance of
the obligation, (ii) has provided property other than the
collateral to secure payment or other performance of the
obligation, or (iii) is otherwise accountable in whole or in part
for payment or other performance of the obligation. The term does
not include issuers or nominated persons under a letter of
credit.
(hhh) 'Original debtor,' except as used in section 30 (3) of
this 2001 Act, means a person that, as debtor, entered into a
security agreement to which a new debtor has become bound under
section 13 (4) of this 2001 Act.
(iii) 'Payment intangible' means a general intangible under
which the account debtor's principal obligation is a monetary
obligation.
(jjj) 'Person related to,' with respect to an individual,
means:
(A) The spouse of the individual;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 7
(B) A brother, brother-in-law, sister or sister-in-law of the
individual;
(C) An ancestor or lineal descendant of the individual or the
individual's spouse; or
(D) Any other relative, by blood or marriage, of the individual
or the individual's spouse who shares the same home with the
individual.
(kkk) 'Person related to,' with respect to an organization,
means:
(A) A person directly or indirectly controlling, controlled by,
or under common control with the organization;
(B) An officer or director of, or a person performing similar
functions with respect to, the organization;
(C) An officer or director of, or a person performing similar
functions with respect to, a person described in subparagraph (A)
of this paragraph;
(D) The spouse of an individual described in subparagraph (A),
(B) or (C) of this paragraph; or
(E) An individual who is related by blood or marriage to an
individual described in subparagraph (A), (B), (C) or (D) of this
paragraph and shares the same home with the individual.
(LLL) 'Proceeds,' except as used in section 107 (2) of this
2001 Act, means the following property:
(A) Whatever is acquired upon the sale, lease, license,
exchange or other disposition of collateral;
(B) Whatever is collected on, or distributed on account of,
collateral;
(C) Rights arising out of collateral;
(D) To the extent of the value of collateral, claims arising
out of the loss, nonconformity or interference with the use of,
defects or infringement of rights in, or damage to, the
collateral; or
(E) To the extent of the value of collateral and to the extent
payable to the debtor or the secured party, insurance payable by
reason of the loss or nonconformity of, defects or infringement
of rights in, or damage to, the collateral.
(mmm) 'Promissory note' means an instrument that evidences a
promise to pay a monetary obligation, does not evidence an order
to pay, and does not contain an acknowledgment by a bank that the
bank has received for deposit a sum of money or funds.
(nnn) 'Proposal' means a record authenticated by a secured
party which includes the terms on which the secured party is
willing to accept collateral in full or partial satisfaction of
the obligation it secures pursuant to sections 118, 119 and 120
of this 2001 Act.
(ooo) 'Public-finance transaction' means a secured transaction
in connection with which:
(A) Debt securities are issued;
(B) All or a portion of the securities issued have an initial
stated maturity of at least 20 years; and
(C) The debtor, obligor, secured party, account debtor or other
person obligated on collateral, assignor or assignee of a secured
obligation, or assignor or assignee of a security interest is a
state or a governmental unit of a state.
(ppp) 'Pursuant to commitment,' with respect to an advance made
or other value given by a secured party, means pursuant to the
secured party's obligation, whether or not a subsequent event of
default or other event not within the secured party's control has
relieved or may relieve the secured party from its obligation.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 8
(qqq) 'Record,' except as used in 'for record,' 'of record,'
'record or legal title' and 'record owner,' means information
that is inscribed on a tangible medium or which is stored in an
electronic or other medium and is retrievable in perceivable
form.
(rrr) 'Registered organization' means an organization organized
solely under the law of a single state or the United States and
as to which the state or the United States is required by statute
or regulation to maintain a public record showing the
organization to have been organized.
(sss) 'Secondary obligor' means an obligor to the extent that:
(A) The obligor's obligation is secondary; or
(B) The obligor has a right of recourse with respect to an
obligation secured by collateral against the debtor, another
obligor, or property of either.
(ttt) 'Secured party' means:
(A) A person in whose favor a security interest is created or
provided for under a security agreement, whether or not any
obligation to be secured is outstanding;
(B) A person that holds an agricultural lien;
(C) A consignor;
(D) A person to which accounts, chattel paper, payment
intangibles or promissory notes have been sold;
(E) A trustee, indenture trustee, agent, collateral agent or
other representative in whose favor a security interest or
agricultural lien is created or provided for; or
(F) A person that holds a security interest arising under ORS
72.4010, 72.5050, 72.7110 (3), 72A.5080 (5), 74.2100 or section
148 of this 2001 Act.
(uuu) 'Security agreement' means an agreement that creates or
provides for a security interest.
(vvv) 'Send,' in connection with a record or notification,
means:
(A) To deposit in the mail, deliver for transmission, or
transmit by any other usual means of communication, with postage
or cost of transmission provided for, addressed to any address
reasonable under the circumstances; or
(B) To cause the record or notification to be received within
the time that it would have been received if properly sent under
subparagraph (A) of this paragraph.
(www) 'Software' means a computer program and any supporting
information provided in connection with a transaction relating to
the program. The term does not include a computer program that is
included in the definition of goods.
(xxx) '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.
(yyy) 'Supporting obligation' means a letter-of-credit right or
secondary obligation that supports the payment or performance of
an account, chattel paper, a document, a general intangible, an
instrument or investment property.
(zzz) 'Tangible chattel paper' means chattel paper evidenced by
a record or records consisting of information that is inscribed
on a tangible medium.
(aaaa) 'Termination statement' means an amendment of a
financing statement which:
(A) Identifies, by its file number, the initial financing
statement to which it relates; and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 9
(B) Indicates either that it is a termination statement or that
the identified financing statement is no longer effective.
(bbbb) 'Transmitting utility' means a person primarily engaged
in the business of:
(A) Operating a railroad, subway, street railway or trolley
bus;
(B) Transmitting communications electrically,
electromagnetically or by light;
(C) Transmitting goods by pipeline or sewer; or
(D) Transmitting or producing and transmitting electricity,
steam, gas or water.
(2) Definitions in other sections. The following definitions in
other sections apply to this chapter: + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
'
Applicant'
ORS 75.1020
'
Beneficiary'
ORS 75.1020
'
Broker'
ORS 78.1020
'
Certificated security'
ORS 78.1020
'
Check'
ORS 73.0104
'
Clearing corporation'
ORS 78.1020
'
Contract for sale'
ORS 72.1060
'
Customer'
ORS 74.1040
'
Entitlement holder'
ORS 78.1020
'
Financial asset'
ORS 78.1020
'
Holder in due course'
ORS 73.0302
'
Issuer'
(with respect
to a letter of credit or
letter-of-credit rigORS 75.1020
Enrolled Senate Bill 171 (SB 171-ACCA) Page 10
'
Issuer'
(with respect
to a security) ORS 78.2010
'
Lease'
ORS 72A.1030
'
Lease agreement'
ORS 72A.1030
'
Lease contract'
ORS 72A.1030
'
Leasehold interest'
ORS 72A.1030
'
Lessee'
ORS 72A.1030
'
Lessee in ordinary course
of business'
ORS 72A.1030
'
Lessor'
ORS 72A.1030
'
Lessor's residual
interest'
ORS 72A.1030
'
Letter of credit'
ORS 75.1020
'
Merchant'
ORS 72.1040
'
Negotiable instrument'
ORS 73.0104
'
Nominated person'
ORS 75.1020
'
Note'
ORS 73.0104
'
Proceeds of a letter
of credit'
ORS 75.1140
'
Prove'
ORS 73.0103
'
Sale'
ORS 72.1060
'
Securities intermediary'
ORS 78.1020
Enrolled Senate Bill 171 (SB 171-ACCA) Page 11
'
Security'
ORS 78.1020
'
Security certificate'
ORS 78.1020
'
Security entitlement'
ORS 78.1020
'
Uncertificated security'
ORS 78.1020 + }
____________________________________________________________
END OF POSSIBLE IRREGULAR TABULAR TEXT
____________________________________________________________
{ + (3) ORS chapter 71 definitions and principles. ORS
chapter 71 contains general definitions and principles of
construction and interpretation applicable throughout this
chapter. + }
SECTION 3. { + 9-103. Purchase-money security interest;
application of payments; burden of establishing. (1) Definitions.
As used in this section:
(a) 'Purchase-money collateral' means goods or software that
secures a purchase-money obligation incurred with respect to that
collateral; and
(b) 'Purchase-money obligation' means an obligation of an
obligor incurred as all or part of the price of the collateral or
for value given to enable the debtor to acquire rights in or the
use of the collateral if the value is in fact so used.
(2) Purchase-money security interest in goods. A security
interest in goods is a purchase-money security interest:
(a) To the extent that the goods are purchase-money collateral
with respect to that security interest;
(b) If the security interest is in inventory that is or was
purchase-money collateral, also to the extent that the security
interest secures a purchase-money obligation incurred with
respect to other inventory in which the secured party holds or
held a purchase-money security interest; and
(c) Also to the extent that the security interest secures a
purchase-money obligation incurred with respect to software in
which the secured party holds or held a purchase-money security
interest.
(3) Purchase-money security interest in software. A security
interest in software is a purchase-money security interest to the
extent that the security interest also secures a purchase-money
obligation incurred with respect to goods in which the secured
party holds or held a purchase-money security interest if:
(a) The debtor acquired its interest in the software in an
integrated transaction in which it acquired an interest in the
goods; and
(b) The debtor acquired its interest in the software for the
principal purpose of using the software in the goods.
(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.
(5) Application of payment in non-consumer-goods transaction.
In a transaction other than a consumer-goods transaction, if the
extent to which a security interest is a purchase-money security
Enrolled Senate Bill 171 (SB 171-ACCA) Page 12
interest depends on the application of a payment to a particular
obligation, the payment must be applied:
(a) In accordance with any reasonable method of application to
which the parties agree;
(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
(c) In the absence of an agreement to a reasonable method and a
timely manifestation of the obligor's intention, in the following
order:
(A) To obligations that are not secured; and
(B) If more than one obligation is secured, to obligations
secured by purchase-money security interests in the order in
which those obligations were incurred.
(6) No loss of status of purchase-money security interest in
non-consumer-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:
(a) The purchase-money collateral also secures an obligation
that is not a purchase-money obligation;
(b) Collateral that is not purchase-money collateral also
secures the purchase-money obligation; or
(c) The purchase-money obligation has been renewed, refinanced,
consolidated, or restructured.
(7) Burden of proof in non-consumer-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.
(8) Nonconsumer-goods transactions; no inference. The
limitation of the rules in subsections (5), (6) and (7) of this
section 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. + }
SECTION 4. { + 9-104. Control of deposit account. (1)
Requirements for control. A secured party has control of a
deposit account if:
(a) The secured party is the bank with which the deposit
account is maintained;
(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
(c) The secured party becomes the bank's customer with respect
to the deposit account.
(2) Debtor's right to direct disposition. A secured party that
has satisfied subsection (1) of this section has control, even if
the debtor retains the right to direct the disposition of funds
from the deposit account. + }
SECTION 5. { + 9-105. Control of electronic chattel paper. A
secured party has control of electronic chattel paper if the
record or records comprising the chattel paper are created,
stored and assigned in such a manner that:
(1) A single authoritative copy of the record or records exists
which is unique, identifiable and, except as otherwise provided
in subsections (4), (5) and (6) of this section, unalterable;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 13
(2) The authoritative copy identifies the secured party as the
assignee of the record or records;
(3) The authoritative copy is communicated to and maintained by
the secured party or its designated custodian;
(4) Copies or revisions that add or change an identified
assignee of the authoritative copy can be made only with the
participation of the secured party;
(5) 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
(6) Any revision of the authoritative copy is readily
identifiable as an authorized or unauthorized revision. + }
SECTION 6. { + 9-106. Control of investment property. (1)
Control under ORS 78.1060. A person has control of a certificated
security, uncertificated security or security entitlement as
provided in ORS 78.1060.
(2) Control of commodity contract. A secured party has control
of a commodity contract if:
(a) The secured party is the commodity intermediary with which
the commodity contract is carried; or
(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.
(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. + }
SECTION 7. { + 9-107. 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 ORS 75.1140 (3) or otherwise applicable law or
practice. + }
SECTION 8. { + 9-108. Sufficiency of description. (1)
Sufficiency of description. Except as otherwise provided in
subsections (3), (4) and (5) of this section, a description of
personal or real property is sufficient, whether or not it is
specific, if it reasonably identifies what is described.
(2) Examples of reasonable identification. Except as otherwise
provided in subsection (4) of this section, a description of
collateral reasonably identifies the collateral if it identifies
the collateral by:
(a) Specific listing;
(b) Category;
(c) Except as otherwise provided in subsection (5) of this
section, a type of collateral defined in the Uniform Commercial
Code;
(d) Quantity;
(e) Computational or allocational formula or procedure; or
(f) Except as otherwise provided in subsection (3) of this
section, any other method, if the identity of the collateral is
objectively determinable.
(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.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 14
(4) Investment property. Except as otherwise provided in
subsection (5) of this section, a description of a security
entitlement, securities account or commodity account is
sufficient if it describes:
(a) The collateral by those terms or as investment property; or
(b) The underlying financial asset or commodity contract.
(5) When description by type insufficient. A description only
by type of collateral defined in the Uniform Commercial Code is
an insufficient description of:
(a) A commercial tort claim; or
(b) In a consumer transaction, consumer goods, a security
entitlement, a securities account or a commodity account. + }
{ +
(Applicability of Chapter) + }
SECTION 9. { + 9-109. Scope. (1) General scope of chapter.
Except as otherwise provided in subsections (3) and (4) of this
section, this chapter applies to:
(a) A transaction, regardless of its form, that creates a
security interest in personal property or fixtures by contract;
(b) An agricultural lien;
(c) A sale of accounts, chattel paper, payment intangibles or
promissory notes;
(d) A consignment;
(e) A security interest arising under ORS 72.4010, 72.5050,
72.7110 (3), or 72A.5080 (5), as provided in section 10 of this
2001 Act; and
(f) A security interest arising under ORS 74.2100 or section
148 of this 2001 Act.
(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.
(3) Extent to which this chapter does not apply. This chapter
does not apply to the extent that:
(a) A statute, regulation or treaty of the United States
preempts this chapter;
(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;
(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
(d) The rights of a transferee beneficiary or nominated person
under a letter of credit are independent and superior under ORS
75.1140.
(4) Inapplicability of chapter. This chapter does not apply to:
(a) A landlord's lien, other than an agricultural lien;
(b) A lien, other than an agricultural lien, given by statute
or other rule of law for services or materials, but section 53 of
this 2001 Act applies with respect to priority of the lien;
(c) An assignment of a claim for wages, salary or other
compensation of an employee;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 15
(d) A sale of accounts, chattel paper, payment intangibles or
promissory notes as part of a sale of the business out of which
they arose;
(e) An assignment of accounts, chattel paper, payment
intangibles or promissory notes which is for the purpose of
collection only;
(f) An assignment of a right to payment under a contract to an
assignee that is also obligated to perform under the contract;
(g) An assignment of a single account, payment intangible or
promissory note to an assignee in full or partial satisfaction of
a preexisting indebtedness;
(h) A transfer of an interest in or an assignment of a claim
under a policy of insurance, other than an assignment by or to a
health-care provider of a health-care-insurance receivable and
any subsequent assignment of the right to payment, but sections
35 and 42 of this 2001 Act apply with respect to proceeds and
priorities in proceeds;
(i) An assignment of a right represented by a judgment, other
than a judgment taken on a right to payment that was collateral;
(j) A right of recoupment or set-off, but:
(A) Section 60 of this 2001 Act applies with respect to the
effectiveness of rights of recoupment or set-off against deposit
accounts; and
(B) Section 66 of this 2001 Act applies with respect to
defenses or claims of an account debtor;
(k) The creation or transfer of an interest in or lien on real
property, including a lease or rents thereunder, or a seller's or
purchaser's interest in a land sale contract and the proceeds
thereof, except to the extent that provision is made for:
(A) Liens on real property in sections 13 and 28 of this 2001
Act;
(B) Fixtures in section 54 of this 2001 Act;
(C) Fixture filings in sections 72, 73, 83, 87 and 90 of this
2001 Act; and
(D) Security agreements covering personal and real property in
section 102 of this 2001 Act;
(L) An assignment of a claim arising in tort, other than a
commercial tort claim, but sections 35 and 42 of this 2001 Act
apply with respect to proceeds and priorities in proceeds; or
(m) An assignment, in a consumer transaction, of a deposit
account from which, under the terms of the account agreement,
third party payments may be made by means of a check, draft,
negotiable order of withdrawal or other order, but sections 35
and 42 of this 2001 Act apply with respect to proceeds and
priorities in proceeds. + }
SECTION 10. { + 9-110. Security interests arising under ORS
72.1010 to 72.7250 or ORS chapter 72A. A security interest
arising under ORS 72.4010, 72.5050, 72.7110 (3) or 72A.5080 (5)
is subject to this chapter. However, until the debtor obtains
possession of the goods:
(1) The security interest is enforceable, even if section 13
(2)(c) of this 2001 Act has not been satisfied;
(2) Filing is not required to perfect the security interest;
(3) The rights of the secured party after default by the debtor
are governed by ORS 72.1010 to 72.7250 or ORS chapter 72A; and
(4) The security interest has priority over a conflicting
security interest created by the debtor. + }
{ +
EFFECTIVENESS OF SECURITY AGREEMENT; + }
Enrolled Senate Bill 171 (SB 171-ACCA) Page 16
{ +
ATTACHMENT OF SECURITY INTEREST; + }
{ +
RIGHTS OF PARTIES TO SECURITY AGREEMENT + }
{ +
(Effectiveness and Attachment) + }
SECTION 11. { + 9-201. General effectiveness of security
agreement. (1) General effectiveness. Except as otherwise
provided in the Uniform Commercial Code, a security agreement is
effective according to its terms between the parties, against
purchasers of the collateral, and against creditors.
(2) Applicable consumer laws and other law. A transaction
subject to this chapter is subject to any applicable rule of law
which establishes a different rule for consumers and is also
subject to ORS 83.510 to 83.680 on retail installment contracts
and ORS chapter 725 on small loans.
(3) Other applicable law controls. In case of conflict between
this chapter and a rule of law, statute or rule described in
subsection (2) of this section, the rule of law, statute or rule
controls. Failure to comply with a statute or rule described in
subsection (2) of this section has only the effect the statute or
rule specifies.
(4) Further deference to other applicable law. This chapter
does not:
(a) Validate any rate, charge, agreement or practice that
violates a rule of law, statute or regulation described in
subsection (2) of this section; or
(b) Extend the application of the rule of law, statute, or rule
to a transaction not otherwise subject to it. + }
SECTION 12. { + 9-202. Title to collateral immaterial. Except
as otherwise provided with respect to consignments or sales of
accounts, chattel paper, payment intangibles or promissory notes,
the provisions of this chapter with regard to rights and
obligations apply whether title to collateral is in the secured
party or the debtor. + }
SECTION 13. { + 9-203. Attachment and enforceability of
security interest; proceeds; supporting obligations; formal
requisites. (1) Attachment. A security interest attaches to
collateral when it becomes enforceable against the debtor with
respect to the collateral, unless an agreement expressly
postpones the time of attachment.
(2) Enforceability. Except as otherwise provided in subsections
(3) to (9) of this section, a security interest is enforceable
against the debtor and third parties with respect to the
collateral only if:
(a) Value has been given;
(b) The debtor has rights in the collateral or the power to
transfer rights in the collateral to a secured party; and
(c) One of the following conditions is met:
(A) The debtor has authenticated a security agreement that
provides a description of the collateral and, if the security
interest covers timber to be cut, a description of the land
concerned;
(B) The collateral is not a certificated security and is in the
possession of the secured party under section 33 of this 2001 Act
pursuant to the debtor's security agreement;
(C) The collateral is a certificated security in registered
form and the security certificate has been delivered to the
Enrolled Senate Bill 171 (SB 171-ACCA) Page 17
secured party under ORS 78.3010 pursuant to the debtor's security
agreement; or
(D) The collateral is deposit accounts, electronic chattel
paper, investment property or letter-of-credit rights, and the
secured party has control under section 4, 5, 6 or 7 of this 2001
Act pursuant to the debtor's security agreement.
(3) Other Uniform Commercial Code provisions. Subsection (2) of
this section is subject to ORS 74.2100 on the security interest
of a collecting bank, section 148 of this 2001 Act on the
security interest of a letter-of-credit issuer or nominated
person, section 10 of this 2001 Act on a security interest
arising under ORS 72.1010 to 72.7250 or ORS chapter 72A and
section 16 of this 2001 Act on security interests in investment
property.
(4) When person becomes bound by another person's security
agreement. A person becomes bound as debtor by a security
agreement entered into by another person if, by operation of law
other than this chapter or by contract:
(a) The security agreement becomes effective to create a
security interest in the person's property; or
(b) The person becomes generally obligated for the obligations
of the other person, including the obligation secured under the
security agreement, and acquires or succeeds to all or
substantially all of the assets of the other person.
(5) Effect of new debtor becoming bound. If a new debtor
becomes bound as debtor by a security agreement entered into by
another person:
(a) The agreement satisfies subsection (2)(c) of this section
with respect to existing or after-acquired property of the new
debtor to the extent the property is described in the agreement;
and
(b) Another agreement is not necessary to make a security
interest in the property enforceable.
(6) Proceeds and supporting obligations. The attachment of a
security interest in collateral gives the secured party the
rights to proceeds provided by section 35 of this 2001 Act and is
also attachment of a security interest in a supporting obligation
for the collateral.
(7) Lien securing right to payment. The attachment of a
security interest in a right to payment or performance secured by
a security interest or other lien on personal or real property is
also attachment of a security interest in the security interest,
mortgage or other lien.
(8) Security entitlement carried in securities account. The
attachment of a security interest in a securities account is also
attachment of a security interest in the security entitlements
carried in the securities account.
(9) Commodity contracts carried in commodity account. The
attachment of a security interest in a commodity account is also
attachment of a security interest in the commodity contracts
carried in the commodity account. + }
SECTION 14. { + 9-204. After-acquired property; future
advances. (1) After-acquired collateral. Except as otherwise
provided in subsection (2) of this section, a security agreement
may create or provide for a security interest in after-acquired
collateral.
(2) When after-acquired property clause not effective. A
security interest does not attach under a term constituting an
after-acquired property clause to:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 18
(a) Consumer goods, other than an accession when given as
additional security, unless the debtor acquires rights in them
within 10 days after the secured party gives value; or
(b) A commercial tort claim.
(3) Future advances and other value. A security agreement may
provide that collateral secures, or that accounts, chattel paper,
payment intangibles or promissory notes are sold in connection
with, future advances or other value, whether or not the advances
or value are given pursuant to commitment. + }
SECTION 15. { + 9-205. Use or disposition of collateral
permissible. (1) When security interest not invalid or
fraudulent. A security interest is not invalid or fraudulent
against creditors solely because:
(a) The debtor has the right or ability to:
(A) Use, commingle or dispose of all or part of the collateral,
including returned or repossessed goods;
(B) Collect, compromise, enforce or otherwise deal with
collateral;
(C) Accept the return of collateral or make repossessions; or
(D) Use, commingle or dispose of proceeds; or
(b) The secured party fails to require the debtor to account
for proceeds or replace collateral.
(2) Requirements of possession not relaxed. This section does
not relax the requirements of possession if attachment,
perfection or enforcement of a security interest depends upon
possession of the collateral by the secured party. + }
SECTION 16. { + 9-206. Security interest arising in purchase
or delivery of financial asset. (1) Security interest when person
buys through securities intermediary. A security interest in
favor of a securities intermediary attaches to a person's
security entitlement if:
(a) The person buys a financial asset through the securities
intermediary in a transaction in which the person is obligated to
pay the purchase price to the securities intermediary at the time
of the purchase; and
(b) The securities intermediary credits the financial asset to
the buyer's securities account before the buyer pays the
securities intermediary.
(2) Security interest secures obligation to pay for financial
asset. The security interest described in subsection (1) of this
section secures the person's obligation to pay for the financial
asset.
(3) Security interest in payment against delivery transaction.
A security interest in favor of a person that delivers a
certificated security or other financial asset represented by a
writing attaches to the security or other financial asset if:
(a) The security or other financial asset:
(A) In the ordinary course of business is transferred by
delivery with any necessary indorsement or assignment; and
(B) Is delivered under an agreement between persons in the
business of dealing with such securities or financial assets; and
(b) The agreement calls for delivery against payment.
(4) Security interest secures obligation to pay for delivery.
The security interest described in subsection (3) of this section
secures the obligation to make payment for the delivery. + }
{ +
(Rights and Duties) + }
Enrolled Senate Bill 171 (SB 171-ACCA) Page 19
SECTION 17. { + 9-207. Rights and duties of secured party
having possession or control of collateral. (1) Except as
otherwise provided in subsection (4) of this section, a secured
party shall use reasonable care in the custody and preservation
of collateral in the secured party's possession. In the case of
chattel paper or an instrument, reasonable care includes taking
necessary steps to preserve rights against prior parties unless
otherwise agreed.
(2) Expenses, risks, duties and rights when secured party in
possession. Except as otherwise provided in subsection (4) of
this section, if a secured party has possession of collateral:
(a) Reasonable expenses, including the cost of insurance and
payment of taxes or other charges, incurred in the custody,
preservation, use or operation of the collateral are chargeable
to the debtor and are secured by the collateral;
(b) The risk of accidental loss or damage is on the debtor to
the extent of a deficiency in any effective insurance coverage;
(c) The secured party shall keep the collateral identifiable,
but fungible collateral may be commingled; and
(d) The secured party may use or operate the collateral:
(A) For the purpose of preserving the collateral or its value;
(B) As permitted by an order of a court having competent
jurisdiction; or
(C) Except in the case of consumer goods, in the manner and to
the extent agreed by the debtor.
(3) Duties and rights when secured party in possession or
control. Except as otherwise provided in subsection (4) of this
section, a secured party having possession of collateral or
control of collateral under section 4, 5, 6 or 7 of this 2001
Act:
(a) May hold as additional security any proceeds, except money
or funds, received from the collateral;
(b) Shall apply money or funds received from the collateral to
reduce the secured obligation, unless remitted to the debtor; and
(c) May create a security interest in the collateral.
(4) Buyer of certain rights to payment. If the secured party is
a buyer of accounts, chattel paper, payment intangibles or
promissory notes or a consignor:
(a) Subsection (1) of this section does not apply unless the
secured party is entitled under an agreement:
(A) To charge back uncollected collateral; or
(B) Otherwise to full or limited recourse against the debtor or
a secondary obligor based on the nonpayment or other default of
an account debtor or other obligor on the collateral; and
(b) Subsections (2) and (3) of this section do not apply. + }
SECTION 18. { + 9-208. Additional duties of secured party
having control of collateral. (1) Applicability of section. This
section applies to cases in which there is no outstanding secured
obligation and the secured party is not committed to make
advances, incur obligations or otherwise give value.
(2) Duties of secured party after receiving demand from debtor.
Within 10 days after receiving an authenticated demand by the
debtor:
(a) A secured party having control of a deposit account under
section 4 (1)(b) of this 2001 Act shall send to the bank with
which the deposit account is maintained an authenticated
statement that releases the bank from any further obligation to
comply with instructions originated by the secured party;
(b) A secured party having control of a deposit account under
section 4 (1)(c) of this 2001 Act shall:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 20
(A) Pay the debtor the balance on deposit in the deposit
account; or
(B) Transfer the balance on deposit into a deposit account in
the debtor's name;
(c) A secured party, other than a buyer, having control of
electronic chattel paper under section 5 of this 2001 Act shall:
(A) Communicate the authoritative copy of the electronic
chattel paper to the debtor or its designated custodian;
(B) If the debtor designates a custodian that is the designated
custodian with which the authoritative copy of the electronic
chattel paper is maintained for the secured party, communicate to
the custodian an authenticated record releasing the designated
custodian from any further obligation to comply with instructions
originated by the secured party and instructing the custodian to
comply with instructions originated by the debtor; and
(C) Take appropriate action to enable the debtor or its
designated custodian to make copies of or revisions to the
authoritative copy which add or change an identified assignee of
the authoritative copy without the consent of the secured party;
(d) A secured party having control of investment property under
ORS 78.1060 (4)(b) or section 6 (2) of this 2001 Act shall send
to the securities intermediary or commodity intermediary with
which the security entitlement or commodity contract is
maintained an authenticated record that releases the securities
intermediary or commodity intermediary from any further
obligation to comply with entitlement orders or directions
originated by the secured party; and
(e) A secured party having control of a letter-of-credit right
under section 7 of this 2001 Act shall send to each person having
an unfulfilled obligation to pay or deliver proceeds of the
letter of credit to the secured party an authenticated release
from any further obligation to pay or deliver proceeds of the
letter of credit to the secured party. + }
SECTION 19. { + 9-209. Duties of secured party if account
debtor has been notified of assignment. (1) Applicability of
section. Except as otherwise provided in subsection (3) of this
section, this section applies if:
(a) There is no outstanding secured obligation; and
(b) The secured party is not committed to make advances, incur
obligations, or otherwise give value.
(2) Duties of secured party after receiving demand from debtor.
Within 10 days after receiving an authenticated demand by the
debtor, a secured party shall send to an account debtor that has
received notification of an assignment to the secured party as
assignee under section 68 (1) of this 2001 Act an authenticated
record that releases the account debtor from any further
obligation to the secured party.
(3) Inapplicability to sales. This section does not apply to an
assignment constituting the sale of an account, chattel paper or
payment intangible. + }
SECTION 20. { + 9-210. Request for accounting; request
regarding list of collateral or statement of account. (1)
Definitions. As used in this section:
(a) 'Request' means a record of a type described in paragraph
(b), (c) or (d) of this subsection.
(b) 'Request for an accounting' means a record authenticated by
a debtor requesting that the recipient provide an accounting of
the unpaid obligations secured by collateral and reasonably
identifying the transaction or relationship that is the subject
of the request.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 21
(c) 'Request regarding a list of collateral' means a record
authenticated by a debtor requesting that the recipient approve
or correct a list of what the debtor believes to be the
collateral securing an obligation and reasonably identifying the
transaction or relationship that is the subject of the request.
(d) 'Request regarding a statement of account' means a record
authenticated by a debtor requesting that the recipient approve
or correct a statement indicating what the debtor believes to be
the aggregate amount of unpaid obligations secured by collateral
as of a specified date and reasonably identifying the transaction
or relationship that is the subject of the request.
(2) Duty to respond to requests. Subject to subsections (3),
(4), (5) and (6) of this section, a secured party, other than a
buyer of accounts, chattel paper, payment intangibles or
promissory notes or a consignor, shall comply with a request
within 14 days after receipt:
(a) In the case of a request for an accounting, by
authenticating and sending to the debtor an accounting; and
(b) In the case of a request regarding a list of collateral or
a request regarding a statement of account, by authenticating and
sending to the debtor an approval or correction.
(3) Request regarding list of collateral; statement concerning
type of collateral. A secured party that claims a security
interest in all of a particular type of collateral owned by the
debtor may comply with a request regarding a list of collateral
by sending to the debtor an authenticated record including a
statement to that effect within 14 days after receipt.
(4) Request regarding list of collateral; no interest claimed.
A person that receives a request regarding a list of collateral,
claims no interest in the collateral when it receives the
request, and claimed an interest in the collateral at an earlier
time shall comply with the request within 14 days after receipt
by sending to the debtor an authenticated record:
(a) Disclaiming any interest in the collateral; and
(b) If known to the recipient, providing the name and mailing
address of any assignee of or successor to the recipient's
interest in the collateral.
(5) Request for accounting or regarding statement of account;
no interest in obligation claimed. A person that receives a
request for an accounting or a request regarding a statement of
account, claims no interest in the obligations when it receives
the request, and claimed an interest in the obligations at an
earlier time shall comply with the request within 14 days after
receipt by sending to the debtor an authenticated record:
(a) Disclaiming any interest in the obligations; and
(b) If known to the recipient, providing the name and mailing
address of any assignee of or successor to the recipient's
interest in the obligations.
(6) Charges for responses. A debtor is entitled without charge
to one response to a request under this section during any
six-month period. The secured party may require payment of a
charge not exceeding $25 for each additional response. + }
{ +
PERFECTION AND PRIORITY + }
{ +
(Law Governing Perfection and Priority) + }
SECTION 21. { + 9-301. Law governing perfection and priority
of security interests. Except as otherwise provided in sections
Enrolled Senate Bill 171 (SB 171-ACCA) Page 22
23 to 26 of this 2001 Act, the following rules determine the law
governing perfection, the effect of perfection or nonperfection
and the priority of a security interest in collateral:
(1) Except as otherwise provided in this section, while a
debtor is located in a jurisdiction, the local law of that
jurisdiction governs perfection, the effect of perfection or
nonperfection and the priority of a security interest in
collateral.
(2) While collateral is located in a jurisdiction, the local
law of that jurisdiction governs perfection, the effect of
perfection or nonperfection, and the priority of a possessory
security interest in that collateral.
(3) Except as otherwise provided in subsection (4) of this
section, while negotiable documents, goods, instruments, money or
tangible chattel paper is located in a jurisdiction, the local
law of that jurisdiction governs:
(a) Perfection of a security interest in the goods by filing a
fixture filing;
(b) Perfection of a security interest in timber to be cut; and
(c) The effect of perfection or nonperfection and the priority
of a nonpossessory security interest in the collateral.
(4) The local law of the jurisdiction in which the wellhead or
minehead is located governs perfection, the effect of perfection
or nonperfection and the priority of a security interest in
as-extracted collateral. + }
SECTION 22. { + 9-302. Law governing perfection and priority
of agricultural liens. While farm products are located in a
jurisdiction, the local law of that jurisdiction governs
perfection, the effect of perfection or nonperfection and the
priority of an agricultural lien on the farm products. + }
SECTION 23. { + 9-303. Law governing perfection and priority
of security interests in goods covered by a certificate of title.
(1) Applicability of section. This section applies to goods
covered by a certificate of title, even if there is no other
relationship between the jurisdiction under whose certificate of
title the goods are covered and the goods or the debtor.
(2) When goods covered by certificate of title. Goods become
covered by a certificate of title when a valid application for
the certificate of title and the applicable fee are delivered to
the appropriate authority. Goods cease to be covered by a
certificate of title at the earlier of the time the certificate
of title ceases to be effective under the law of the issuing
jurisdiction or the time the goods become covered subsequently by
a certificate of title issued by another jurisdiction.
(3) Applicable law. The local law of the jurisdiction under
whose certificate of title the goods are covered governs
perfection, the effect of perfection or nonperfection, and the
priority of a security interest in goods covered by a certificate
of title from the time the goods become covered by the
certificate of title until the goods cease to be covered by the
certificate of title. + }
SECTION 24. { + 9-304. Law governing perfection and priority
of security interests in deposit accounts. (1) Law of bank's
jurisdiction governs. The local law of a bank's jurisdiction
governs perfection, the effect of perfection or nonperfection and
the priority of a security interest in a deposit account
maintained with that bank.
(2) Bank's jurisdiction. The following rules determine a bank's
jurisdiction for purposes of sections 21 to 62 of this 2001 Act:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 23
(a) If an agreement between the bank and the debtor governing
the deposit account expressly provides that a particular
jurisdiction is the bank's jurisdiction for purposes of sections
21 to 62 of this 2001 Act, this chapter or the Uniform Commercial
Code, that jurisdiction is the bank's jurisdiction.
(b) If paragraph (a) of this subsection does not apply and an
agreement between the bank and its customer governing the deposit
account expressly provides that the agreement is governed by the
law of a particular jurisdiction, that jurisdiction is the bank's
jurisdiction.
(c) If neither paragraph (a) nor paragraph (b) of this
subsection applies and an agreement between the bank and its
customer governing the deposit account expressly provides that
the deposit account is maintained at an office in a particular
jurisdiction, that jurisdiction is the bank's jurisdiction.
(d) If paragraphs (a) to (c) of this subsection do not apply,
the bank's jurisdiction is the jurisdiction in which the office
identified in an account statement as the office serving the
customer's account is located.
(e) If paragraphs (a) to (d) of this subsection do not apply,
the bank's jurisdiction is the jurisdiction in which the chief
executive office of the bank is located. + }
SECTION 25. { + 9-305. Law governing perfection and priority
of security interests in investment property. (1) Governing law:
General rules. Except as otherwise provided in subsection (3) of
this section, the following rules apply:
(a) While a security certificate is located in a jurisdiction,
the local law of that jurisdiction governs perfection, the effect
of perfection or nonperfection and the priority of a security
interest in the certificated security represented thereby.
(b) The local law of the issuer's jurisdiction as specified in
ORS 78.1100 (4) governs perfection, the effect of perfection or
nonperfection and the priority of a security interest in an
uncertificated security.
(c) The local law of the securities intermediary's jurisdiction
as specified in ORS 78.1100 (5) governs perfection, the effect of
perfection or nonperfection and the priority of a security
interest in a security entitlement or securities account.
(d) The local law of the commodity intermediary's jurisdiction
governs perfection, the effect of perfection or nonperfection and
the priority of a security interest in a commodity contract or
commodity account.
(2) Commodity intermediary's jurisdiction. The following rules
determine a commodity intermediary's jurisdiction for purposes of
sections 21 to 62 of this 2001 Act:
(a) If an agreement between the commodity intermediary and
commodity customer governing the commodity account expressly
provides that a particular jurisdiction is the commodity
intermediary's jurisdiction for purposes of sections 21 to 62 of
this 2001 Act, this chapter or the Uniform Commercial Code, that
jurisdiction is the commodity intermediary's jurisdiction.
(b) If paragraph (a) of this subsection does not apply and an
agreement between the commodity intermediary and commodity
customer governing the commodity account expressly provides that
the agreement is governed by the law of a particular
jurisdiction, that jurisdiction is the commodity intermediary's
jurisdiction.
(c) If neither paragraph (a) nor paragraph (b) of this
subsection applies and an agreement between the commodity
intermediary and commodity customer governing the commodity
Enrolled Senate Bill 171 (SB 171-ACCA) Page 24
account expressly provides that the commodity account is
maintained at an office in a particular jurisdiction, that
jurisdiction is the commodity intermediary's jurisdiction.
(d) If paragraphs (a) to (c) of this subsection do not apply,
the commodity intermediary's jurisdiction is the jurisdiction in
which the office identified in an account statement as the office
serving the commodity customer's account is located.
(e) If paragraphs (a) to (d) of this subsection do not apply,
the commodity intermediary's jurisdiction is the jurisdiction in
which the chief executive office of the commodity intermediary is
located.
(3) When perfection governed by law of jurisdiction where
debtor located. The local law of the jurisdiction in which the
debtor is located governs:
(a) Perfection of a security interest in investment property by
filing;
(b) Automatic perfection of a security interest in investment
property created by a broker or securities intermediary; and
(c) Automatic perfection of a security interest in a commodity
contract or commodity account created by a commodity
intermediary. + }
SECTION 26. { + 9-306. Law governing perfection and priority
of security interests in letter-of-credit rights. (1) Governing
law: Issuer's or nominated person's jurisdiction. Subject to
subsection (3) of this section, the local law of the issuer's
jurisdiction or a nominated person's jurisdiction governs
perfection, the effect of perfection or nonperfection and the
priority of a security interest in a letter-of-credit right if
the issuer's jurisdiction or nominated person's jurisdiction is a
state.
(2) Issuer's or nominated person's jurisdiction. For purposes
of sections 21 to 62 of this 2001 Act, an issuer's jurisdiction
or nominated person's jurisdiction is the jurisdiction whose law
governs the liability of the issuer or nominated person with
respect to the letter-of-credit right as provided in ORS 75.1160.
(3) When section not applicable. This section does not apply to
a security interest that is perfected only under section 28 (4)
of this 2001 Act. + }
SECTION 27. { + 9-307. Location of debtor. (1) 'Place of
business.' As used in this section, 'place of business' means a
place where a debtor conducts its affairs.
(2) Debtor's location: General rules. Except as otherwise
provided in this section, the following rules determine a
debtor's location:
(a) A debtor who is an individual is located at the
individual's principal residence.
(b) A debtor that is an organization and has only one place of
business is located at its place of business.
(c) A debtor that is an organization and has more than one
place of business is located at its chief executive office.
(3) Limitation of applicability of subsection (2) of this
section. Subsection (2) of this section applies only if a
debtor's residence, place of business or chief executive office,
as applicable, is located in a jurisdiction whose law generally
requires information concerning the existence of a nonpossessory
security interest to be made generally available in a filing,
recording or registration system as a condition or result of the
security interest's obtaining priority over the rights of a lien
creditor with respect to the collateral. If subsection (2) of
Enrolled Senate Bill 171 (SB 171-ACCA) Page 25
this section does not apply, the debtor is located in the
District of Columbia.
(4) Continuation of location: cessation of existence, etc. A
person that ceases to exist, have a residence or have a place of
business continues to be located in the jurisdiction specified by
subsections (2) and (3) of this section.
(5) Location of registered organization organized under state
law. A registered organization that is organized under the law of
a state is located in that state.
(6) Location of registered organization organized under federal
law; bank branches and agencies. Except as otherwise provided in
subsection (9) of this section, a registered organization that is
organized under the law of the United States and a branch or
agency of a bank that is not organized under the law of the
United States or a state are located:
(a) In the state that the law of the United States designates,
if the law designates a state of location;
(b) In the state that the registered organization, branch or
agency designates, if the law of the United States authorizes the
registered organization, branch or agency to designate its state
of location; or
(c) In the District of Columbia, if neither paragraph (a) nor
paragraph (b) of this subsection applies.
(7) Continuation of location: change in status of registered
organization. A registered organization continues to be located
in the jurisdiction specified by subsection (5) or (6) of this
section notwithstanding:
(a) The suspension, revocation, forfeiture or lapse of the
registered organization's status as such in its jurisdiction of
organization; or
(b) The dissolution, winding up or cancellation of the
existence of the registered organization.
(8) Location of United States. The United States is located in
the District of Columbia.
(9) Location of foreign bank branch or agency if licensed in
only one state. A branch or agency of a bank that is not
organized under the law of the United States or a state is
located in the state in which the branch or agency is licensed,
if all branches and agencies of the bank are licensed in only one
state.
(10) Location of foreign air carrier. A foreign air carrier
under the Federal Aviation Act of 1958, as amended, is located at
the designated office of the agent upon which service of process
may be made on behalf of the carrier.
(11) Section applies only to sections 21 to 62 of this 2001
Act. This section applies only for purposes of sections 21 to 62
of this 2001 Act. + }
{ +
(Perfection) + }
SECTION 28. { + 9-308. When security interest or agricultural
lien is perfected; continuity of perfection. (1) Perfection of
security interest. Except as otherwise provided in this section
and section 29 of this 2001 Act, a security interest is perfected
if it has attached and all of the applicable requirements for
perfection in sections 30 to 36 of this 2001 Act have been
satisfied. A security interest is perfected when it attaches if
the applicable requirements are satisfied before the security
interest attaches.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 26
(2) Perfection of agricultural lien. An agricultural lien is
perfected if it has become effective and all of the applicable
requirements for perfection in section 30 of this 2001 Act have
been satisfied. An agricultural lien is perfected when it becomes
effective if the applicable requirements are satisfied before the
agricultural lien becomes effective.
(3) Continuous perfection; perfection by different methods. A
security interest or agricultural lien is perfected continuously
if it is originally perfected by one method under this chapter
and is later perfected by another method under this chapter,
without an intermediate period when it was unperfected.
(4) Supporting obligation. Perfection of a security interest in
collateral also perfects a security interest in a supporting
obligation for the collateral.
(5) Lien securing right to payment. Perfection of a security
interest in a right to payment or performance also perfects a
security interest in a security interest, mortgage or other lien
on personal or real property securing the right.
(6) Security entitlement carried in securities account.
Perfection of a security interest in a securities account also
perfects a security interest in the security entitlements carried
in the securities account.
(7) Commodity contract carried in commodity account.
Perfection of a security interest in a commodity account also
perfects a security interest in the commodity contracts carried
in the commodity account. + }
SECTION 29. { + 9-309. Security interest perfected upon
attachment. The following security interests are perfected when
they attach:
(1) A purchase-money security interest in consumer goods,
except as otherwise provided in section 31 (2) of this 2001 Act
with respect to consumer goods that are subject to a statute or
treaty described in section 31 (1) of this 2001 Act;
(2) An assignment of accounts or payment intangibles which does
not by itself or in conjunction with other assignments to the
same assignee transfer a significant part of the assignor's
outstanding accounts or payment intangibles;
(3) A sale of a payment intangible;
(4) A sale of a promissory note;
(5) A security interest created by the assignment of a
health-care-insurance receivable to the provider of the
health-care goods or services;
(6) A security interest arising under ORS 72.4010, 72.5050,
72.7110 (3), or 72A.5080 (5), until the debtor obtains possession
of the collateral;
(7) A security interest of a collecting bank arising under ORS
74.2100;
(8) A security interest of an issuer or nominated person
arising under section 148 of this 2001 Act;
(9) A security interest arising in the delivery of a financial
asset under section 16 (3) of this 2001 Act;
(10) A security interest in investment property created by a
broker or securities intermediary;
(11) A security interest in a commodity contract or a commodity
account created by a commodity intermediary;
(12) An assignment for the benefit of all creditors of the
transferor and subsequent transfers by the assignee thereunder;
and
(13) A security interest created by an assignment of a
beneficial interest in a decedent's estate. + }
Enrolled Senate Bill 171 (SB 171-ACCA) Page 27
SECTION 30. { + 9-310. When filing required to perfect
security interest or agricultural lien; security interests and
agricultural liens to which filing provisions do not apply. (1)
General rule: perfection by filing. Except as otherwise provided
in subsection (2) of this section and section 32 (2) of this 2001
Act, a financing statement must be filed to perfect all security
interests and agricultural liens.
(2) Exceptions: filing not necessary. The filing of a financing
statement is not necessary to perfect a security interest:
(a) That is perfected under section 28 (4), (5), (6) or (7) of
this 2001 Act;
(b) That is perfected under section 29 of this 2001 Act when it
attaches;
(c) In property subject to a statute, regulation or treaty
described in section 31 (1) of this 2001 Act;
(d) In goods in possession of a bailee that are perfected under
section 32 (4)(a) or (b) of this 2001 Act;
(e) In certificated securities, documents, goods or instruments
that are perfected without filing or possession under section 32
(5), (6) or (7) of this 2001 Act;
(f) In collateral in the secured party's possession under
section 33 of this 2001 Act;
(g) In a certificated security which is perfected by delivery
of the security certificate to the secured party under section 33
of this 2001 Act;
(h) In deposit accounts, electronic chattel paper, investment
property or letter-of-credit rights that are perfected by control
under section 34 of this 2001 Act;
(i) In proceeds that are perfected under section 35 of this
2001 Act; or
(j) That are perfected under section 36 of this 2001 Act.
(3) Assignment of perfected security interest. If a secured
party assigns a perfected security interest or agricultural lien,
a filing under this chapter is not required to continue the
perfected status of the security interest against creditors of
and transferees from the original debtor. + }
SECTION 31. { + 9-311. Perfection of security interests in
property subject to certain statutes, regulations and treaties.
(1) Security interest subject to other law. Except as otherwise
provided in subsection (4) of this section, the filing of a
financing statement is not necessary or effective to perfect a
security interest in property subject to:
(a) A statute, regulation or treaty of the United States whose
requirements for a security interest's obtaining priority over
the rights of a lien creditor with respect to the property
preempt section 30 (1) of this 2001 Act;
(b) ORS chapter 830 and the Oregon Vehicle Code; or
(c) A certificate-of-title statute of another jurisdiction
which provides for a security interest 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 property.
(2) Compliance with other law. Compliance with the requirements
of a statute, regulation or treaty described in subsection (1) of
this section for obtaining priority over the rights of a lien
creditor is equivalent to the filing of a financing statement
under this chapter. Except as otherwise provided in subsection
(4) of this section and sections 33 and 36 (4) and (5) of this
2001 Act for goods covered by a certificate of title, a security
interest in property subject to a statute, regulation or treaty
Enrolled Senate Bill 171 (SB 171-ACCA) Page 28
described in subsection (1) of this section may be perfected only
by compliance with those requirements, and a security interest so
perfected remains perfected notwithstanding a change in the use
or transfer of possession of the collateral.
(3) Duration and renewal of perfection. Except as otherwise
provided in subsection (4) of this section and section 36 (4) and
(5) of this 2001 Act, duration and renewal of perfection of a
security interest perfected by compliance with the requirements
prescribed by a statute, regulation or treaty described in
subsection (1) of this section are governed by the statute,
regulation or treaty. In other respects, the security interest is
subject to this chapter.
(4) Inapplicability to certain inventory. During any period in
which collateral subject to a statute specified in subsection
(1)(b) of this section is inventory held for sale or lease by a
person or leased by that person as lessor and that person is in
the business of selling goods of that kind, this section does not
apply to a security interest in that collateral created by that
person. + }
SECTION 32. { + 9-312. Perfection of security interests in
chattel paper, deposit accounts, documents, goods covered by
documents, instruments, investment property, letter-of-credit
rights and money; perfection by permissive filing; temporary
perfection without filing or transfer of possession. (1)
Perfection by filing permitted. A security interest in chattel
paper, negotiable documents, instruments or investment property
may be perfected by filing. Except for goods in which filing is
not necessary or effective to perfect a security interest under
this chapter, a security interest in goods may be perfected by
filing.
(2) Control or possession of certain collateral. Except as
otherwise provided in section 35 (3) and (4) of this 2001 Act for
proceeds:
(a) A security interest in a deposit account may be perfected
only by control under section 34 of this 2001 Act;
(b) And except as otherwise provided in section 28 (4) of this
2001 Act, a security interest in a letter-of-credit right may be
perfected only by control under section 34 of this 2001 Act; and
(c) A security interest in money may be perfected only by the
secured party's taking possession under section 33 of this 2001
Act.
(3) Goods covered by negotiable document. While goods are in
the possession of a bailee that has issued a negotiable document
covering the goods:
(a) A security interest in the goods may be perfected by
perfecting a security interest in the document; and
(b) A security interest perfected in the document has priority
over any security interest that becomes perfected in the goods by
another method during that time.
(4) Goods covered by nonnegotiable document. While goods are in
the possession of a bailee that has issued a nonnegotiable
document covering the goods, a security interest in the goods may
be perfected by:
(a) Issuance of a document in the name of the secured party;
(b) The bailee's receipt of notification of the secured party's
interest; or
(c) Filing as to the goods.
(5) Temporary perfection: New value. A security interest in
certificated securities, negotiable documents or instruments is
perfected without filing or the taking of possession for a period
Enrolled Senate Bill 171 (SB 171-ACCA) Page 29
of 20 days from the time it attaches to the extent that it arises
for new value given under an authenticated security agreement.
(6) Temporary perfection: Goods or documents made available to
debtor. A perfected security interest in a negotiable document or
goods in possession of a bailee, other than one that has issued a
negotiable document for the goods, remains perfected for 20 days
without filing if the secured party makes available to the debtor
the goods or documents representing the goods for the purpose of:
(a) Ultimate sale or exchange; or
(b) Loading, unloading, storing, shipping, transshipping,
manufacturing, processing or otherwise dealing with them in a
manner preliminary to their sale or exchange.
(7) Temporary perfection: Delivery of security certificate or
instrument to debtor. A perfected security interest in a
certificated security or instrument remains perfected for 20 days
without filing if the secured party delivers the security
certificate or instrument to the debtor for the purpose of:
(a) Ultimate sale or exchange; or
(b) Presentation, collection, enforcement, renewal or
registration of transfer.
(8) Expiration of temporary perfection. After the 20-day period
specified in subsection (5), (6) or (7) of this section expires,
perfection depends upon compliance with this chapter. + }
SECTION 33. { + 9-313. When possession by or delivery to
secured party perfects security interest without filing. (1)
Perfection by possession or delivery. Except as otherwise
provided in subsection (2) of this section, a secured party may
perfect a security interest in negotiable documents, goods,
instruments, money or tangible chattel paper by taking possession
of the collateral. A secured party may perfect a security
interest in certificated securities by taking delivery of the
certificated securities under ORS 78.3010.
(2) Goods covered by certificate of title. With respect to
goods covered by a certificate of title issued by this state, a
secured party may perfect a security interest in the goods by
taking possession of the goods only in the circumstances
described in section 36 (5) of this 2001 Act.
(3) Collateral in possession of person other than debtor. With
respect to collateral other than certificated securities and
goods covered by a document, a secured party takes possession of
collateral in the possession of a person other than the debtor,
the secured party or a lessee of the collateral from the debtor
in the ordinary course of the debtor's business, when:
(a) The person in possession authenticates a record
acknowledging that it holds possession of the collateral for the
secured party's benefit; or
(b) The person takes possession of the collateral after having
authenticated a record acknowledging that it will hold possession
of collateral for the secured party's benefit.
(4) Time of perfection by possession; continuation of
perfection. If perfection of a security interest depends upon
possession of the collateral by a secured party, perfection
occurs no earlier than the time the secured party takes
possession and continues only while the secured party retains
possession.
(5) Time of perfection by delivery; continuation of perfection.
A security interest in a certificated security in registered form
is perfected by delivery when delivery of the certificated
security occurs under ORS 78.3010 and remains perfected by
Enrolled Senate Bill 171 (SB 171-ACCA) Page 30
delivery until the debtor obtains possession of the security
certificate.
(6) Acknowledgment not required. A person in possession of
collateral is not required to acknowledge that it holds
possession for a secured party's benefit.
(7) Effectiveness of acknowledgment; no duties or confirmation.
If a person acknowledges that it holds possession for the secured
party's benefit:
(a) The acknowledgment is effective under subsection (3) of
this section or ORS 78.3010 (1), even if the acknowledgment
violates the rights of a debtor; and
(b) Unless the person otherwise agrees or law other than this
chapter otherwise provides, the person does not owe any duty to
the secured party and is not required to confirm the
acknowledgment to another person.
(8) Secured party's delivery to person other than debtor. A
secured party having possession of collateral does not relinquish
possession by delivering the collateral to a person other than
the debtor or a lessee of the collateral from the debtor in the
ordinary course of the debtor's business if the person was
instructed before the delivery or is instructed contemporaneously
with the delivery:
(a) To hold possession of the collateral for the secured
party's benefit; or
(b) To redeliver the collateral to the secured party.
(9) Effect of delivery under subsection (8) of this section; no
duties or confirmation. A secured party does not relinquish
possession, even if a delivery under subsection (8) of this
section violates the rights of a debtor. A person to which
collateral is delivered under subsection (8) of this section does
not owe any duty to the secured party and is not required to
confirm the delivery to another person unless the person
otherwise agrees or law other than this chapter otherwise
provides. + }
SECTION 34. { + 9-314. Perfection by control. (1) Perfection
by control. A security interest in investment property, deposit
accounts, letter-of-credit rights or electronic chattel paper may
be perfected by control of the collateral under section 4, 5, 6
or 7 of this 2001 Act.
(2) Specified collateral: Time of perfection by control;
continuation of perfection. A security interest in deposit
accounts, electronic chattel paper or letter-of-credit rights is
perfected by control under section 4, 5 or 7 of this 2001 Act
when the secured party obtains control and remains perfected by
control only while the secured party retains control.
(3) Investment property: Time of perfection by control;
continuation of perfection. A security interest in investment
property is perfected by control under section 6 of this 2001 Act
from the time the secured party obtains control and remains
perfected by control until:
(a) The secured party does not have control; and
(b) One of the following occurs:
(A) If the collateral is a certificated security, the debtor
has or acquires possession of the security certificate;
(B) If the collateral is an uncertificated security, the issuer
has registered or registers the debtor as the registered owner;
or
(C) If the collateral is a security entitlement, the debtor is
or becomes the entitlement holder. + }
Enrolled Senate Bill 171 (SB 171-ACCA) Page 31
SECTION 35. { + 9-315. Secured party's rights on disposition
of collateral and in proceeds. (1) Disposition of collateral:
Continuation of security interest or agricultural lien; proceeds.
Except as otherwise provided in this chapter and in ORS 72.4030
(2):
(a) A security interest or agricultural lien continues in
collateral notwithstanding sale, lease, license, exchange or
other disposition thereof unless the secured party authorized the
disposition free of the security interest or agricultural lien;
and
(b) A security interest attaches to any identifiable proceeds
of collateral.
(2) When commingled proceeds identifiable. Proceeds that are
commingled with other property are identifiable proceeds:
(a) If the proceeds are goods, to the extent provided by
section 56 of this 2001 Act; and
(b) If the proceeds are not goods, to the extent that the
secured party identifies the proceeds by a method of tracing,
including application of equitable principles, that is permitted
under law other than this chapter with respect to commingled
property of the type involved.
(3) Perfection of security interest in proceeds. A security
interest in proceeds is a perfected security interest if the
security interest in the original collateral was perfected.
(4) Continuation of perfection. A perfected security interest
in proceeds becomes unperfected on the 21st day after the
security interest attaches to the proceeds unless:
(a) The following conditions are satisfied:
(A) A filed financing statement covers the original collateral;
(B) The proceeds are collateral in which a security interest
may be perfected by filing in the office in which the financing
statement has been filed; and
(C) The proceeds are not acquired with cash proceeds;
(b) The proceeds are identifiable cash proceeds; or
(c) The security interest in the proceeds is perfected other
than under subsection (3) of this section when the security
interest attaches to the proceeds or within 20 days thereafter.
(5) When perfected security interest in proceeds becomes
unperfected. If a filed financing statement covers the original
collateral, a security interest in proceeds which remains
perfected under subsection (4)(a) of this section becomes
unperfected at the later of:
(a) When the effectiveness of the filed financing statement
lapses under section 86 of this 2001 Act or is terminated under
section 84 of this 2001 Act; or
(b) The 21st day after the security interest attaches to the
proceeds. + }
SECTION 36. { + 9-316. Continued perfection of security
interest following change in governing law. (1) General rule:
Effect on perfection of change in governing law. A security
interest perfected pursuant to the law of the jurisdiction
designated in section 21 (1) or 25 (3) of this 2001 Act remains
perfected until the earliest of:
(a) The time perfection would have ceased under the law of that
jurisdiction;
(b) The expiration of four months after a change of the
debtor's location to another jurisdiction; or
(c) The expiration of one year after a transfer of collateral
to a person that thereby becomes a debtor and is located in
another jurisdiction.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 32
(2) Security interest perfected or unperfected under law of new
jurisdiction. If a security interest described in subsection (1)
of this section becomes perfected under the law of the other
jurisdiction before the earliest time or event described in that
subsection, it remains perfected thereafter. If the security
interest does not become perfected under the law of the other
jurisdiction before the earliest time or event, it becomes
unperfected and is deemed never to have been perfected as against
a purchaser of the collateral for value.
(3) Possessory security interest in collateral moved to new
jurisdiction. A possessory security interest in collateral, other
than goods covered by a certificate of title and as-extracted
collateral consisting of goods, remains continuously perfected
if:
(a) The collateral is located in one jurisdiction and subject
to a security interest perfected under the law of that
jurisdiction;
(b) Thereafter the collateral is brought into another
jurisdiction; and
(c) Upon entry into the other jurisdiction, the security
interest is perfected under the law of the other jurisdiction.
(4) Goods covered by certificate of title from this state.
Except as otherwise provided in subsection (5) of this section, a
security interest in goods covered by a certificate of title
which is perfected by any method under the law of another
jurisdiction when the goods become covered by a certificate of
title from this state remains perfected until the security
interest would have become unperfected under the law of the other
jurisdiction had the goods not become so covered.
(5) When subsection (4) of this section security interest
becomes unperfected against purchasers. A security interest
described in subsection (4) of this section becomes unperfected
as against a purchaser of the goods for value and is deemed never
to have been perfected as against a purchaser of the goods for
value if the applicable requirements for perfection under section
31 (2) or 33 of this 2001 Act are not satisfied before the
earlier of:
(a) The time the security interest would have become
unperfected under the law of the other jurisdiction had the goods
not become covered by a certificate of title from this state; or
(b) The expiration of four months after the goods had become so
covered.
(6) Change in jurisdiction of bank, issuer, nominated person,
securities intermediary or commodity intermediary. A security
interest in deposit accounts, letter-of-credit rights or
investment property which is perfected under the law of the
bank's jurisdiction, the issuer's jurisdiction, a nominated
person's jurisdiction, the securities intermediary's jurisdiction
or the commodity intermediary's jurisdiction, as applicable,
remains perfected until the earlier of:
(a) The time the security interest would have become
unperfected under the law of that jurisdiction; or
(b) The expiration of four months after a change of the
applicable jurisdiction to another jurisdiction.
(7) Subsection (6) of this section security interest perfected
or unperfected under law of new jurisdiction. If a security
interest described in subsection (6) of this section becomes
perfected under the law of the other jurisdiction before the
earlier of the time or the end of the period described in
subsection (6) of this section, it remains perfected thereafter.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 33
If the security interest does not become perfected under the law
of the other jurisdiction before the earlier of that time or the
end of that period, it becomes unperfected and is deemed never to
have been perfected as against a purchaser of the collateral for
value. + }
{ +
(Priority) + }
SECTION 37. { + 9-317. Interests that take priority over or
take free of security interest or agricultural lien. (1)
Conflicting security interests and rights of lien creditors. A
security interest or agricultural lien is subordinate to the
rights of:
(a) A person entitled to priority under section 42 of this 2001
Act; and
(b) Except as otherwise provided in subsection (5) of this
section, a person that becomes a lien creditor before the earlier
of the time:
(A) The security interest or agricultural lien is perfected; or
(B) One of the conditions specified in section 13 (2)(c) of
this 2001 Act is met and a financing statement covering the
collateral is filed.
(2) Buyers that receive delivery. Except as otherwise provided
in subsection (5) of this section, a buyer, other than a secured
party, of tangible chattel paper, documents, goods, instruments
or a security certificate takes free of a security interest or
agricultural lien if the buyer gives value and receives delivery
of the collateral without knowledge of the security interest or
agricultural lien and before it is perfected.
(3) Lessees that receive delivery. Except as otherwise provided
in subsection (5) of this section, a lessee of goods takes free
of a security interest or agricultural lien if the lessee gives
value and receives delivery of the collateral without knowledge
of the security interest or agricultural lien and before it is
perfected.
(4) Licensees and buyers of certain collateral. A licensee of a
general intangible or a buyer, other than a secured party, of
accounts, electronic chattel paper, general intangibles or
investment property other than a certificated security takes free
of a security interest if the licensee or buyer gives value
without knowledge of the security interest and before it is
perfected.
(5) Purchase-money security interest. Except as otherwise
provided in sections 40 and 41 of this 2001 Act, if a person
files a financing statement with respect to a purchase-money
security interest before or within 20 days after the debtor
receives delivery of the collateral, the security interest takes
priority over the rights of a buyer, lessee or lien creditor
which arise between the time the security interest attaches and
the time of filing. + }
SECTION 38. { + 9-318. No interest retained in right to
payment that is sold; rights and title of seller of account or
chattel paper with respect to creditors and purchasers. (1)
Seller retains no interest. A debtor that has sold an account,
chattel paper, payment intangible or promissory note does not
retain a legal or equitable interest in the collateral sold.
(2) Deemed rights of debtor if buyer's security interest
unperfected. For purposes of determining the rights of creditors
of, and purchasers for value of an account or chattel paper from,
Enrolled Senate Bill 171 (SB 171-ACCA) Page 34
a debtor that has sold an account or chattel paper, while the
buyer's security interest is unperfected, the debtor is deemed to
have rights and title to the account or chattel paper identical
to those the debtor sold. + }
SECTION 39. { + 9-319. Rights and title of consignee with
respect to creditors and purchasers. (1) Consignee has
consignor's rights. Except as otherwise provided in subsection
(2) of this section, for purposes of determining the rights of
creditors of, and purchasers for value of goods from, a
consignee, while the goods are in the possession of the
consignee, the consignee is deemed to have rights and title to
the goods identical to those the consignor had or had power to
transfer.
(2) Applicability of other law. For purposes of determining the
rights of a creditor of a consignee, law other than this chapter
determines the rights and title of a consignee while goods are in
the consignee's possession if, under sections 21 to 62 of this
2001 Act, a perfected security interest held by the consignor
would have priority over the rights of the creditor. + }
SECTION 40. { + 9-320. Buyer of goods. (1) Buyer in ordinary
course of business. Except as otherwise provided in subsection
(5) of this section, a buyer in ordinary course of business,
other than a person buying farm products from a person engaged in
farming operations, takes free of a security interest created by
the buyer's seller, even if the security interest is perfected
and the buyer knows of its existence.
(2) Buyer of consumer goods. Except as otherwise provided in
subsection (5) of this section, a buyer of goods from a person
who used or bought the goods for use primarily for personal,
family or household purposes takes free of a security interest,
even if perfected, if the buyer buys:
(a) Without knowledge of the security interest;
(b) For value;
(c) Primarily for the buyer's personal, family or household
purposes; and
(d) Before the filing of a financing statement covering the
goods.
(3) Effectiveness of filing for subsection (2) of this section.
To the extent that it affects the priority of a security interest
over a buyer of goods under subsection (2) of this section, the
period of effectiveness of a filing made in the jurisdiction in
which the seller is located is governed by section 36 (1) and (2)
of this 2001 Act.
(4) Buyer in ordinary course of business at wellhead or
minehead. A buyer in ordinary course of business buying oil, gas
or other minerals at the wellhead or minehead or after extraction
takes free of an interest arising out of an encumbrance.
(5) Possessory security interest not affected. Subsections (1)
and (2) of this section do not affect a security interest in
goods in the possession of the secured party under section 33 of
this 2001 Act. + }
SECTION 41. { + 9-321. Licensee of general intangible and
lessee of goods in ordinary course of business. (1) 'Licensee in
ordinary course of business.' As used in this section, 'licensee
in ordinary course of business' means a person that becomes a
licensee of a general intangible in good faith, without knowledge
that the license violates the rights of another person in the
general intangible, and in the ordinary course from a person in
the business of licensing general intangibles of that kind. A
person becomes a licensee in the ordinary course if the license
Enrolled Senate Bill 171 (SB 171-ACCA) Page 35
to the person comports with the usual or customary practices in
the kind of business in which the licensor is engaged or with the
licensor's own usual or customary practices.
(2) Rights of licensee in ordinary course of business. A
licensee in ordinary course of business takes its rights under a
nonexclusive license free of a security interest in the general
intangible created by the licensor, even if the security interest
is perfected and the licensee knows of its existence.
(3) Rights of lessee in ordinary course of business. A lessee
in ordinary course of business takes its leasehold interest free
of a security interest in the goods created by the lessor, even
if the security interest is perfected and the lessee knows of its
existence. + }
SECTION 42. { + 9-322. Priorities among conflicting security
interests in and agricultural liens on same collateral. (1)
General priority rules. Except as otherwise provided in this
section, priority among conflicting security interests and
agricultural liens in the same collateral is determined according
to the following rules:
(a) Conflicting perfected security interests and agricultural
liens rank according to priority in time of filing or perfection.
Priority dates from the earlier of the time a filing covering the
collateral is first made or the security interest or agricultural
lien is first perfected, if there is no period thereafter when
there is neither filing nor perfection.
(b) A perfected security interest or agricultural lien has
priority over a conflicting unperfected security interest or
agricultural lien.
(c) The first security interest or agricultural lien to attach
or become effective has priority if conflicting security
interests and agricultural liens are unperfected.
(2) Time of perfection: Proceeds and supporting obligations.
For the purposes of subsection (1)(a) of this section:
(a) The time of filing or perfection as to a security interest
in collateral is also the time of filing or perfection as to a
security interest in proceeds; and
(b) The time of filing or perfection as to a security interest
in collateral supported by a supporting obligation is also the
time of filing or perfection as to a security interest in the
supporting obligation.
(3) Special priority rules: proceeds and supporting
obligations. Except as otherwise provided in subsection (6) of
this section, a security interest in collateral which qualifies
for priority over a conflicting security interest under section
47, 48, 49, 50 or 51 of this 2001 Act also has priority over a
conflicting security interest in:
(a) Any supporting obligation for the collateral; and
(b) Proceeds of the collateral if:
(A) The security interest in proceeds is perfected;
(B) The proceeds are cash proceeds or of the same type as the
collateral; and
(C) In the case of proceeds that are proceeds of proceeds, all
intervening proceeds are cash proceeds, proceeds of the same type
as the collateral or an account relating to the collateral.
(4) First-to-file priority rule for certain collateral.
Subject to subsection (5) of this section and except as otherwise
provided in subsection (6) of this section, if a security
interest in chattel paper, deposit accounts, negotiable
documents, instruments, investment property or letter-of-credit
rights is perfected by a method other than filing, conflicting
Enrolled Senate Bill 171 (SB 171-ACCA) Page 36
perfected security interests in proceeds of the collateral rank
according to priority in time of filing.
(5) Applicability of subsection (4) of this section.
Subsection (4) of this section applies only if the proceeds of
the collateral are not cash proceeds, chattel paper, negotiable
documents, instruments, investment property or letter-of-credit
rights.
(6) Limitations on subsections (1) to (5) of this section.
Subsections (1) to (5) of this section are subject to:
(a) Subsection (7) of this section and the other provisions of
sections 21 to 62 of this 2001 Act;
(b) ORS 74.2100 with respect to a security interest of a
collecting bank;
(c) Section 148 of this 2001 Act with respect to a security
interest of an issuer or nominated person; and
(d) Section 10 of this 2001 Act with respect to a security
interest arising under ORS 72.1010 to 72.7250 or ORS chapter 72A.
(7) Priority under agricultural lien statute. A perfected
agricultural lien on collateral has priority over a conflicting
security interest in or agricultural lien on the same collateral
if the statute creating the agricultural lien so provides. + }
SECTION 43. { + 9-323. Future advances. (1) When priority
based on time of advance. Except as otherwise provided in
subsection (3) of this section, for purposes of determining the
priority of a perfected security interest under section 42 (1)(a)
of this 2001 Act, perfection of the security interest dates from
the time an advance is made to the extent that the security
interest secures an advance that:
(a) Is made while the security interest is perfected only:
(A) Under section 29 of this 2001 Act when it attaches; or
(B) Temporarily under section 32 (5), (6) or (7) of this 2001
Act; and
(b) Is not made pursuant to a commitment entered into before or
while the security interest is perfected by a method other than
under section 29 or 32 (5), (6) or (7) of this 2001 Act.
(2) Lien creditor. Except as otherwise provided in subsection
(3) of this section, a security interest is subordinate to the
rights of a person that becomes a lien creditor to the extent
that the security interest secures an advance made more than 45
days after the person becomes a lien creditor unless the advance
is made:
(a) Without knowledge of the lien; or
(b) Pursuant to a commitment entered into without knowledge of
the lien.
(3) Buyer of receivables. Subsections (1) and (2) of this
section do not apply to a security interest held by a secured
party that is a buyer of accounts, chattel paper, payment
intangibles or promissory notes or a consignor.
(4) Buyer of goods. Except as otherwise provided in subsection
(5) of this section, a buyer of goods other than a buyer in
ordinary course of business takes free of a security interest to
the extent that it secures advances made after the earlier of:
(a) The time the secured party acquires knowledge of the
buyer's purchase; or
(b) Forty-five days after the purchase.
(5) Advances made pursuant to commitment: Priority of buyer of
goods. Subsection (4) of this section does not apply if the
advance is made pursuant to a commitment entered into without
knowledge of the buyer's purchase and before the expiration of
the 45-day period.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 37
(6) Lessee of goods. Except as otherwise provided in subsection
(7) of this section, a lessee of goods, other than a lessee in
ordinary course of business, takes the leasehold interest free of
a security interest to the extent that it secures advances made
after the earlier of:
(a) The time the secured party acquires knowledge of the lease;
or
(b) Forty-five days after the lease contract becomes
enforceable.
(7) Advances made pursuant to commitment: Priority of lessee of
goods. Subsection (6) of this section does not apply if the
advance is made pursuant to a commitment entered into without
knowledge of the lease and before the expiration of the 45-day
period. + }
SECTION 44. { + 9-324. Priority of purchase-money security
interests. (1) General rule: Purchase-money priority. Except as
otherwise provided in subsection (7) of this section, a perfected
purchase-money security interest in goods other than inventory or
livestock has priority over a conflicting security interest in
the same goods, and, except as otherwise provided in section 47
of this 2001 Act, a perfected security interest in its
identifiable proceeds also has priority, if the purchase-money
security interest is perfected when the debtor receives
possession of the collateral or within 20 days thereafter.
(2) Inventory purchase-money priority. Subject to subsection
(3) of this section and except as otherwise provided in
subsection (7) of this section, a perfected purchase-money
security interest in inventory has priority over a conflicting
security interest in the same inventory, has priority over a
conflicting security interest in chattel paper or an instrument
constituting proceeds of the inventory and in proceeds of the
chattel paper, if so provided in section 50 of this 2001 Act,
and, except as otherwise provided in section 47 of this 2001 Act,
also has priority in identifiable cash proceeds of the inventory
to the extent the identifiable cash proceeds are received on or
before the delivery of the inventory to a buyer, if:
(a) The purchase-money security interest is perfected when the
debtor receives possession of the inventory;
(b) The purchase-money secured party sends an authenticated
notification to the holder of the conflicting security interest;
(c) The holder of the conflicting security interest receives
the notification within five years before the debtor receives
possession of the inventory; and
(d) The notification states that the person sending the
notification has or expects to acquire a purchase-money security
interest in inventory of the debtor and describes the inventory.
(3) Holders of conflicting inventory security interests to be
notified. Subsection (2)(b) to (d) of this section applies only
if the holder of the conflicting security interest had filed a
financing statement covering the same types of inventory:
(a) If the purchase-money security interest is perfected by
filing, before the date of the filing; or
(b) If the purchase-money security interest is temporarily
perfected without filing or possession under section 32 (6) of
this 2001 Act, before the beginning of the 20-day period
thereunder.
(4) Livestock purchase-money priority. Subject to subsection
(5) of this section and except as otherwise provided in
subsection (7) of this section, a perfected purchase-money
security interest in livestock that are farm products has
Enrolled Senate Bill 171 (SB 171-ACCA) Page 38
priority over a conflicting security interest in the same
livestock, and, except as otherwise provided in section 47 of
this 2001 Act, a perfected security interest in their
identifiable proceeds and identifiable products in their
unmanufactured states also has priority, if:
(a) The purchase-money security interest is perfected when the
debtor receives possession of the livestock;
(b) The purchase-money secured party sends an authenticated
notification to the holder of the conflicting security interest;
(c) The holder of the conflicting security interest receives
the notification within six months before the debtor receives
possession of the livestock; and
(d) The notification states that the person sending the
notification has or expects to acquire a purchase-money security
interest in livestock of the debtor and describes the livestock.
(5) Holders of conflicting livestock security interests to be
notified. Subsection (4)(b) to (d) of this section applies only
if the holder of the conflicting security interest had filed a
financing statement covering the same types of livestock:
(a) If the purchase-money security interest is perfected by
filing, before the date of the filing; or
(b) If the purchase-money security interest is temporarily
perfected without filing or possession under section 32 (6) of
this 2001 Act, before the beginning of the 20-day period
thereunder.
(6) Software purchase-money priority. Except as otherwise
provided in subsection (7) of this section, a perfected
purchase-money security interest in software has priority over a
conflicting security interest in the same collateral, and, except
as otherwise provided in section 47 of this 2001 Act, a perfected
security interest in its identifiable proceeds also has priority,
to the extent that the purchase-money security interest in the
goods in which the software was acquired for use has priority in
the goods and proceeds of the goods under this section.
(7) Conflicting purchase-money security interests. If more than
one security interest qualifies for priority in the same
collateral under subsection (1), (2), (4) or (6) of this section:
(a) A security interest securing an obligation incurred as all
or part of the price of the collateral has priority over a
security interest securing an obligation incurred for value given
to enable the debtor to acquire rights in or the use of
collateral; and
(b) In all other cases, section 42 (1) of this 2001 Act applies
to the qualifying security interests. + }
SECTION 45. { + 9-325. Priority of security interests in
transferred collateral. (1) Subordination of security interest in
transferred collateral. Except as otherwise provided in
subsection (2) of this section, a security interest created by a
debtor is subordinate to a security interest in the same
collateral created by another person if:
(a) The debtor acquired the collateral subject to the security
interest created by the other person;
(b) The security interest created by the other person was
perfected when the debtor acquired the collateral; and
(c) There is no period thereafter when the security interest is
unperfected.
(2) Limitation of subsection (1) of this section subordination.
Subsection (1) of this section subordinates a security interest
only if the security interest:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 39
(a) Otherwise would have priority solely under section 42 (1)
or 43 of this 2001 Act; or
(b) Arose solely under ORS 72.7110 (3) or 72A.5080 (5). + }
SECTION 46. { + 9-326. Priority of security interests created
by new debtor. (1) Subordination of security interest created by
new debtor. Subject to subsection (2) of this section, a security
interest created by a new debtor which is perfected by a filed
financing statement that is effective solely under section 79 of
this 2001 Act in collateral in which a new debtor has or acquires
rights is subordinate to a security interest in the same
collateral which is perfected other than by a filed financing
statement that is effective solely under section 79 of this 2001
Act.
(2) Priority under other provisions; multiple original debtors.
The other provisions of sections 21 to 62 of this 2001 Act
determine the priority among conflicting security interests in
the same collateral perfected by filed financing statements that
are effective solely under section 79 of this 2001 Act. However,
if the security agreements to which a new debtor became bound as
debtor were not entered into by the same original debtor, the
conflicting security interests rank according to priority in time
of the new debtor's having become bound. + }
SECTION 47. { + 9-327. Priority of security interests in
deposit account. The following rules govern priority among
conflicting security interests in the same deposit account:
(1) A security interest held by a secured party having control
of the deposit account under section 4 of this 2001 Act has
priority over a conflicting security interest held by a secured
party that does not have control.
(2) Except as otherwise provided in subsections (3) and (4) of
this section, security interests perfected by control under
section 34 of this 2001 Act rank according to priority in time of
obtaining control.
(3) Except as otherwise provided in subsection (4) of this
section, a security interest held by the bank with which the
deposit account is maintained has priority over a conflicting
security interest held by another secured party.
(4) A security interest perfected by control under section 4
(1)(c) of this 2001 Act has priority over a security interest
held by the bank with which the deposit account is
maintained. + }
SECTION 48. { + 9-328. Priority of security interests in
investment property. The following rules govern priority among
conflicting security interests in the same investment property:
(1) A security interest held by a secured party having control
of investment property under section 6 of this 2001 Act has
priority over a security interest held by a secured party that
does not have control of the investment property.
(2) Except as otherwise provided in subsections (3) and (4) of
this section, conflicting security interests held by secured
parties each of which has control under section 6 of this 2001
Act rank according to priority in time of:
(a) If the collateral is a security, obtaining control;
(b) If the collateral is a security entitlement carried in a
securities account and:
(A) If the secured party obtained control under ORS 78.1060
(4)(a), the secured party's becoming the person for which the
securities account is maintained;
(B) If the secured party obtained control under ORS 78.1060
(4)(b), the securities intermediary's agreement to comply with
Enrolled Senate Bill 171 (SB 171-ACCA) Page 40
the secured party's entitlement orders with respect to security
entitlements carried or to be carried in the securities account;
or
(C) If the secured party obtained control through another
person under ORS 78.1060 (4)(c), the time on which priority would
be based under this subsection if the other person were the
secured party; or
(c) If the collateral is a commodity contract carried with a
commodity intermediary, the satisfaction of the requirement for
control specified in section 6 (2)(b) of this 2001 Act with
respect to commodity contracts carried or to be carried with the
commodity intermediary.
(3) A security interest held by a securities intermediary in a
security entitlement or a securities account maintained with the
securities intermediary has priority over a conflicting security
interest held by another secured party.
(4) A security interest held by a commodity intermediary in a
commodity contract or a commodity account maintained with the
commodity intermediary has priority over a conflicting security
interest held by another secured party.
(5) A security interest in a certificated security in
registered form which is perfected by taking delivery under
section 33 (1) of this 2001 Act and not by control under section
34 of this 2001 Act has priority over a conflicting security
interest perfected by a method other than control.
(6) Conflicting security interests created by a broker,
securities intermediary, or commodity intermediary which are
perfected without control under section 6 of this 2001 Act rank
equally.
(7) In all other cases, priority among conflicting security
interests in investment property is governed by sections 42 and
43 of this 2001 Act. + }
SECTION 49. { + 9-329. Priority of security interests in
letter-of-credit right. The following rules govern priority among
conflicting security interests in the same letter-of-credit
right:
(1) A security interest held by a secured party having control
of the letter-of-credit right under section 7 of this 2001 Act
has priority to the extent of its control over a conflicting
security interest held by a secured party that does not have
control.
(2) Security interests perfected by control under section 34 of
this 2001 Act rank according to priority in time of obtaining
control. + }
SECTION 50. { + 9-330. Priority of purchaser of chattel paper
or instrument. (1) Purchaser's priority: Security interest
claimed merely as proceeds. A purchaser of chattel paper has
priority over a security interest in the chattel paper which is
claimed merely as proceeds of inventory subject to a security
interest if:
(a) In good faith and in the ordinary course of the purchaser's
business, the purchaser gives new value and takes possession of
the chattel paper or obtains control of the chattel paper under
section 5 of this 2001 Act; and
(b) The chattel paper does not indicate that it has been
assigned to an identified assignee other than the purchaser.
(2) Purchaser's priority: Other security interests. A purchaser
of chattel paper has priority over a security interest in the
chattel paper which is claimed other than merely as proceeds of
inventory subject to a security interest if the purchaser gives
Enrolled Senate Bill 171 (SB 171-ACCA) Page 41
new value and takes possession of the chattel paper or obtains
control of the chattel paper under section 5 of this 2001 Act in
good faith, in the ordinary course of the purchaser's business,
and without knowledge that the purchase violates the rights of
the secured party.
(3) Chattel paper purchaser's priority in proceeds. Except as
otherwise provided in section 47 of this 2001 Act, a purchaser
having priority in chattel paper under subsection (1) or (2) of
this section also has priority in proceeds of the chattel paper
to the extent that:
(a) Section 42 of this 2001 Act provides for priority in the
proceeds; or
(b) The proceeds consist of the specific goods covered by the
chattel paper or cash proceeds of the specific goods, even if the
purchaser's security interest in the proceeds is unperfected.
(4) Instrument purchaser's priority. Except as otherwise
provided in section 51 (1) of this 2001 Act, a purchaser of an
instrument has priority over a security interest in the
instrument perfected by a method other than possession if the
purchaser gives value and takes possession of the instrument in
good faith and without knowledge that the purchase violates the
rights of the secured party.
(5) Holder of purchase-money security interest gives new value.
For purposes of subsections (1) and (2) of this section, the
holder of a purchase-money security interest in inventory gives
new value for chattel paper constituting proceeds of the
inventory.
(6) Indication of assignment gives knowledge. For purposes of
subsections (2) and (4) of this section, if chattel paper or an
instrument indicates that it has been assigned to an identified
secured party other than the purchaser, a purchaser of the
chattel paper or instrument has knowledge that the purchase
violates the rights of the secured party. + }
SECTION 51. { + 9-331. Priority of rights of purchasers of
instruments, documents and securities under ORS chapters 73, 77
and 78; priority of interests in financial assets and security
entitlements under ORS chapter 78. (1) Rights under ORS chapters
73, 77 and 78 not limited. This chapter does not limit the rights
of a holder in due course of a negotiable instrument, a holder to
which a negotiable document of title has been duly negotiated or
a protected purchaser of a security. These holders or purchasers
take priority over an earlier security interest, even if
perfected, to the extent provided in ORS chapters 73, 77 and 78.
(2) Protection under ORS chapter 78. This chapter does not
limit the rights of or impose liability on a person to the extent
that the person is protected against the assertion of a claim
under ORS chapter 78.
(3) Filing not notice. Filing under this chapter does not
constitute notice of a claim or defense to the holders, or
purchasers, or persons described in subsections (1) and (2) of
this section. + }
SECTION 52. { + 9-332. Transfer of money; transfer of funds
from deposit account. (1) Transferee of money. A transferee of
money takes the money free of a security interest unless the
transferee acts in collusion with the debtor in violating the
rights of the secured party.
(2) Transferee of funds from deposit account. A transferee of
funds from a deposit account takes the funds free of a security
interest in the deposit account unless the transferee acts in
Enrolled Senate Bill 171 (SB 171-ACCA) Page 42
collusion with the debtor in violating the rights of the secured
party. + }
SECTION 53. { + 9-333. Priority of certain liens arising by
operation of law. (1) 'Possessory lien.' As used in this section,
'possessory lien' means an interest, other than a security
interest or an agricultural lien:
(a) Which secures payment or performance of an obligation for
services or materials furnished with respect to goods by a person
in the ordinary course of the person's business;
(b) Which is created by statute or rule of law in favor of the
person; and
(c) Whose effectiveness depends on the person's possession of
the goods.
(2) Priority of possessory lien. A possessory lien on goods has
priority over a security interest in the goods unless the lien is
created by a statute that expressly provides otherwise. + }
SECTION 54. { + 9-334. Priority of security interests in
fixtures and crops. (1) Security interest in fixtures under this
chapter. A security interest under this chapter may be created in
goods that are fixtures or may continue in goods that become
fixtures. A security interest does not exist under this chapter
in ordinary building materials incorporated into an improvement
on land.
(2) Security interest in fixtures under real-property law.
This chapter does not prevent creation of an encumbrance upon
fixtures under real property law.
(3) General rule: subordination of security interest in
fixtures. In cases not governed by subsections (4) to (8) of this
section, a security interest in fixtures is subordinate to a
conflicting interest of an encumbrancer or owner of the related
real property other than the debtor.
(4) Fixtures purchase-money priority. Except as otherwise
provided in subsection (8) of this section, a perfected security
interest in fixtures has priority over a conflicting interest of
an encumbrancer or owner of the real property if the debtor has
an interest of record in or is in possession of the real property
and:
(a) The security interest is a purchase-money security
interest;
(b) The interest of the encumbrancer or owner arises before the
goods become fixtures; and
(c) The security interest is perfected by a fixture filing
before the goods become fixtures or within 20 days thereafter.
(5) Priority of security interest in fixtures over interests in
real property. A perfected security interest in fixtures has
priority over a conflicting interest of an encumbrancer or owner
of the real property if:
(a) The debtor has an interest of record in the real property
or is in possession of the real property and the security
interest:
(A) Is perfected by a fixture filing before the interest of the
encumbrancer or owner is of record; and
(B) Has priority over any conflicting interest of a predecessor
in title of the encumbrancer or owner;
(b) Before the goods become fixtures, the security interest is
perfected by any method permitted by this chapter and the
fixtures are readily removable:
(A) Factory or office machines;
(B) Equipment that is not primarily used or leased for use in
the operation of the real property; or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 43
(C) Replacements of domestic appliances that are consumer
goods;
(c) The conflicting interest is a lien on the real property
obtained by legal or equitable proceedings after the security
interest was perfected by any method permitted by this chapter;
or
(d) The security interest is:
(A) Created in a manufactured home in a manufactured-home
transaction; and
(B) Perfected pursuant to a statute described in section 31
(1)(b) of this 2001 Act.
(6) Priority based on consent, disclaimer, or right to remove.
A security interest in fixtures, whether or not perfected, has
priority over a conflicting interest of an encumbrancer or owner
of the real property if:
(a) The encumbrancer or owner has, in an authenticated record,
consented to the security interest or disclaimed an interest in
the goods as fixtures; or
(b) The debtor has a right to remove the goods as against the
encumbrancer or owner.
(7) Continuation of priority under subsection (6)(b) of this
section. The priority of the security interest under subsection
(6)(b) of this section continues for a reasonable time if the
debtor's right to remove the goods as against the encumbrancer or
owner terminates.
(8) Priority of construction mortgage. A mortgage is a
construction mortgage to the extent that it secures an obligation
incurred for the construction of an improvement on land,
including the acquisition cost of the land, if a recorded record
of the mortgage so indicates. Except as otherwise provided in
subsections (5) and (6) of this section, a security interest in
fixtures is subordinate to a construction mortgage if a record of
the mortgage is recorded before the goods become fixtures and the
goods become fixtures before the completion of the construction.
A mortgage has this priority to the same extent as a construction
mortgage to the extent that it is given to refinance a
construction mortgage.
(9) Priority of security interest in crops. A perfected
security interest in crops growing on real property has priority
over a conflicting interest of an encumbrancer or owner of the
real property if the debtor has an interest of record in or is in
possession of the real property. + }
SECTION 55. { + 9-335. Accessions. (1) Creation of security
interest in accession. A security interest may be created in an
accession and continues in collateral that becomes an accession.
(2) Perfection of security interest. If a security interest is
perfected when the collateral becomes an accession, the security
interest remains perfected in the collateral.
(3) Priority of security interest. Except as otherwise provided
in subsections (4) and (7) of this section, the other provisions
of sections 21 to 62 of this 2001 Act determine the priority of a
security interest in an accession.
(4) Compliance with certificate-of-title statute. Except as
otherwise provided in subsection (7) of this section, a security
interest in an accession is subordinate to a security interest in
the whole which is perfected by compliance with the requirements
of a certificate-of-title statute under section 31 (2) of this
2001 Act.
(5) Removal of accession after default. After default, subject
to sections 99 to 126 of this 2001 Act, a secured party may
Enrolled Senate Bill 171 (SB 171-ACCA) Page 44
remove an accession from other goods if the security interest in
the accession has priority over the claims of every person having
an interest in the whole.
(6) Reimbursement following removal. A secured party that
removes an accession from other goods under subsection (5) of
this section shall promptly reimburse any holder of a security
interest or other lien on, or owner of, the whole or of the other
goods, other than the debtor, for the cost of repair of any
physical injury to the whole or the other goods. The secured
party need not reimburse the holder or owner for any diminution
in value of the whole or the other goods caused by the absence of
the accession removed or by any necessity for replacing it. A
person entitled to reimbursement may refuse permission to remove
until the secured party gives adequate assurance for the
performance of the obligation to reimburse.
(7) A security interest in an accession has priority over a
security interest in the whole which is perfected by compliance
with the requirements of a certificate-of-title statute under
section 31 (2) of this 2001 Act if the security interest in the
accession is a purchase money security interest that is perfected
when the debtor receives possession of the accession or within 20
days thereafter. + }
SECTION 56. { + 9-336. Commingled goods. (1) 'Commingled
goods.' As used in this section, 'commingled goods' means goods
that are physically united with other goods in such a manner that
their identity is lost in a product or mass.
(2) No security interest in commingled goods as such. A
security interest does not exist in commingled goods as such.
However, a security interest may attach to a product or mass that
results when goods become commingled goods.
(3) Attachment of security interest to product or mass. If
collateral becomes commingled goods, a security interest attaches
to the product or mass.
(4) Perfection of security interest. If a security interest in
collateral is perfected before the collateral becomes commingled
goods, the security interest that attaches to the product or mass
under subsection (3) of this section is perfected.
(5) Priority of security interest. Except as otherwise provided
in subsection (6) of this section, the other provisions of
sections 21 to 62 of this 2001 Act determine the priority of a
security interest that attaches to the product or mass under
subsection (3) of this section.
(6) Conflicting security interests in product or mass. If more
than one security interest attaches to the product or mass under
subsection (3) of this section, the following rules determine
priority:
(a) A security interest that is perfected under subsection (4)
of this section has priority over a security interest that is
unperfected at the time the collateral becomes commingled goods.
(b) If more than one security interest is perfected under
subsection (4) of this section, the security interests rank
equally in proportion to the value of the collateral at the time
it became commingled goods. + }
SECTION 57. { + 9-337. Priority of security interests in
goods covered by certificate of title. If, while a security
interest in goods is perfected by any method under the law of
another jurisdiction, this state issues a certificate of title
that does not show that the goods are subject to the security
interest or contain a statement that they may be subject to
security interests not shown on the certificate:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 45
(1) A buyer of the goods, other than a person in the business
of selling goods of that kind, takes free of the security
interest if the buyer gives value and receives delivery of the
goods after issuance of the certificate and without knowledge of
the security interest; and
(2) The security interest is subordinate to a conflicting
security interest in the goods that attaches, and is perfected
under section 31 (2) of this 2001 Act, after issuance of the
certificate and without the conflicting secured party's knowledge
of the security interest. + }
SECTION 58. { + 9-338. Priority of security interest or
agricultural lien perfected by filed financing statement
providing certain incorrect information. Except for information
on the jurisdiction of organization for an organization that is
not a registered organization, if a security interest or
agricultural lien is perfected by a filed financing statement
providing information described in section 87 (2)(e) of this 2001
Act which is incorrect at the time the financing statement is
filed:
(1) The security interest or agricultural lien is subordinate
to a conflicting perfected security interest in the collateral to
the extent that the holder of the conflicting security interest
gives value in reasonable reliance upon the incorrect
information; and
(2) A purchaser, other than a secured party, of the collateral
takes free of the security interest or agricultural lien to the
extent that, in reasonable reliance upon the incorrect
information, the purchaser gives value and, in the case of
chattel paper, documents, goods, instruments or a security
certificate, receives delivery of the collateral. + }
SECTION 59. { + 9-339. Priority subject to subordination.
This chapter does not preclude subordination by agreement by a
person entitled to priority. + }
{ +
(Rights of Bank) + }
SECTION 60. { + 9-340. Effectiveness of right of recoupment
or set-off against deposit account. (1) Exercise of recoupment or
set-off. Except as otherwise provided in subsection (3) of this
section, a bank with which a deposit account is maintained may
exercise any right of recoupment or set-off against a secured
party that holds a security interest in the deposit account.
(2) Recoupment or set-off not affected by security interest.
Except as otherwise provided in subsection (3) of this section,
the application of this chapter to a security interest in a
deposit account does not affect a right of recoupment or set-off
of the secured party as to a deposit account maintained with the
secured party.
(3) When set-off ineffective. The exercise by a bank of a
set-off against a deposit account is ineffective against a
secured party that holds a security interest in the deposit
account which is perfected by control under section 4 (1)(c) of
this 2001 Act, if the set-off is based on a claim against the
debtor. + }
SECTION 61. { + 9-341. Bank's rights and duties with respect
to deposit account. Except as otherwise provided in section 60
(3) of this 2001 Act, and unless the bank otherwise agrees in an
authenticated record, a bank's rights and duties with respect to
Enrolled Senate Bill 171 (SB 171-ACCA) Page 46
a deposit account maintained with the bank are not terminated,
suspended, or modified by:
(1) The creation, attachment or perfection of a security
interest in the deposit account;
(2) The bank's knowledge of the security interest; or
(3) The bank's receipt of instructions from the secured
party. + }
SECTION 62. { + 9-342. Bank's right to refuse to enter into
or disclose existence of control agreement. This chapter does not
require a bank to enter into an agreement of the kind described
in section 4 (1)(b) of this 2001 Act, even if its customer so
requests or directs. A bank that has entered into such an
agreement is not required to confirm the existence of the
agreement to another person unless requested to do so by its
customer. + }
{ +
RIGHTS OF THIRD PARTIES + }
SECTION 63. { + 9-401. Alienability of debtor's rights. (1)
Other law governs alienability; exceptions. Except as otherwise
provided in subsection (2) of this section and sections 68, 69,
70 and 71 of this 2001 Act, whether a debtor's rights in
collateral may be voluntarily or involuntarily transferred is
governed by law other than this chapter.
(2) Agreement does not prevent transfer. An agreement between
the debtor and secured party which prohibits a transfer of the
debtor's rights in collateral or makes the transfer a default
does not prevent the transfer from taking effect. + }
SECTION 64. { + 9-402. Secured party not obligated on
contract of debtor or in tort. The existence of a security
interest, agricultural lien, or authority given to a debtor to
dispose of or use collateral, without more, does not subject a
secured party to liability in contract or tort for the debtor's
acts or omissions. + }
SECTION 65. { + 9-403. Agreement not to assert defenses
against assignee. (1) 'Value.' As used in this section, 'value'
has the meaning provided in ORS 73.0303 (1).
(2) Agreement not to assert claim or defense. Except as
otherwise provided in this section, an agreement between an
account debtor and an assignor not to assert against an assignee
any claim or defense that the account debtor may have against the
assignor is enforceable by an assignee that takes an assignment:
(a) For value;
(b) In good faith;
(c) Without notice of a claim of a property or possessory right
to the property assigned; and
(d) Without notice of a defense or claim in recoupment of the
type that may be asserted against a person entitled to enforce a
negotiable instrument under ORS 73.0305 (1).
(3) When subsection (2) of this section not applicable.
Subsection (2) of this section does not apply to defenses of a
type that may be asserted against a holder in due course of a
negotiable instrument under ORS 73.0305 (2).
(4) Omission of required statement in consumer transaction. In
a consumer transaction, if a record evidences the account
debtor's obligation, law other than this chapter requires that
the record include a statement to the effect that the rights of
an assignee are subject to claims or defenses that the account
Enrolled Senate Bill 171 (SB 171-ACCA) Page 47
debtor could assert against the original obligee, and the record
does not include such a statement:
(a) The record has the same effect as if the record included
such a statement; and
(b) The account debtor may assert against an assignee those
claims and defenses that would have been available if the record
included such a statement.
(5) Rule for individual under other law. This section is
subject to law other than this chapter which establishes a
different rule for an account debtor who is an individual and who
incurred the obligation primarily for personal, family, or
household purposes.
(6) Other law not displaced. Except as otherwise provided in
subsection (4) of this section, this section does not displace
law other than this chapter which gives effect to an agreement by
an account debtor not to assert a claim or defense against an
assignee. + }
SECTION 66. { + 9-404. Rights acquired by assignee; claims
and defenses against assignee. (1) Assignee's rights subject to
terms, claims and defenses; exceptions. Unless an account debtor
has made an enforceable agreement not to assert defenses or
claims and subject to subsections (2) to (5) of this section, the
rights of an assignee are subject to:
(a) All terms of the agreement between the account debtor and
assignor and any defense or claim in recoupment arising from the
transaction that gave rise to the contract; and
(b) Any other defense or claim of the account debtor against
the assignor which accrues before the account debtor receives a
notification of the assignment authenticated by the assignor or
the assignee.
(2) Account debtor's claim reduces amount owed to assignee.
Subject to subsection (3) of this section and except as otherwise
provided in subsection (4) of this section, the claim of an
account debtor against an assignor may be asserted against an
assignee under subsection (1) of this section only to reduce the
amount the account debtor owes.
(3) Rule for individual under other law. This section is
subject to law other than this chapter which establishes a
different rule for an account debtor who is an individual and who
incurred the obligation primarily for personal, family or
household purposes.
(4) Omission of required statement in consumer transaction. In
a consumer transaction, if a record evidences the account
debtor's obligation, law other than this chapter requires that
the record include a statement to the effect that the account
debtor's recovery against an assignee with respect to claims and
defenses against the assignor may not exceed amounts paid by the
account debtor under the record, and the record does not include
such a statement, the extent to which a claim of an account
debtor against the assignor may be asserted against an assignee
is determined as if the record included such a statement.
(5) Inapplicability to health-care-insurance receivable. This
section does not apply to an assignment of a
health-care-insurance receivable. + }
SECTION 67. { + 9-405. Modification of assigned contract. (1)
Effect of modification on assignee. A modification of or
substitution for an assigned contract is effective against an
assignee if made in good faith. The assignee acquires
corresponding rights under the modified or substituted contract.
The assignment may provide that the modification or substitution
Enrolled Senate Bill 171 (SB 171-ACCA) Page 48
is a breach of contract by the assignor. This subsection is
subject to subsections (2) to (4) of this section.
(2) Applicability of subsection (1) of this section.
Subsection (1) of this section applies to the extent that:
(a) The right to payment or a part thereof under an assigned
contract has not been fully earned by performance; or
(b) The right to payment or a part thereof has been fully
earned by performance and the account debtor has not received
notification of the assignment under section 68 (1) of this 2001
Act.
(3) Rule for individual under other law. This section is
subject to law other than this chapter which establishes a
different rule for an account debtor who is an individual and who
incurred the obligation primarily for personal, family or
household purposes.
(4) Inapplicability to health-care-insurance receivable. This
section does not apply to an assignment of a
health-care-insurance receivable. + }
SECTION 68. { + 9-406. Discharge of account debtor;
notification of assignment; identification and proof of
assignment; restrictions on assignment of accounts, chattel
paper, payment intangibles and promissory notes ineffective. (1)
Discharge of account debtor; effect of notification. Subject to
subsections (2) to (9) of this section, an account debtor on an
account, chattel paper or a payment intangible may discharge its
obligation by paying the assignor until, but not after, the
account debtor receives a notification, authenticated by the
assignor or the assignee, that the amount due or to become due
has been assigned and that payment is to be made to the assignee.
After receipt of the notification, the account debtor may
discharge its obligation by paying the assignee and may not
discharge the obligation by paying the assignor.
(2) When notification ineffective. Subject to subsection (8) of
this section, notification is ineffective under subsection (1) of
this section:
(a) If it does not reasonably identify the rights assigned;
(b) To the extent that an agreement between an account debtor
and a seller of a payment intangible limits the account debtor's
duty to pay a person other than the seller and the limitation is
effective under law other than this chapter; or
(c) At the option of an account debtor, if the notification
notifies the account debtor to make less than the full amount of
any installment or other periodic payment to the assignee, even
if:
(A) Only a portion of the account, chattel paper or payment
intangible has been assigned to that assignee;
(B) A portion has been assigned to another assignee; or
(C) The account debtor knows that the assignment to that
assignee is limited.
(3) Proof of assignment. Subject to subsection (8) of this
section, if requested by the account debtor, an assignee shall
seasonably furnish reasonable proof that the assignment has been
made. Unless the assignee complies, the account debtor may
discharge its obligation by paying the assignor, even if the
account debtor has received a notification under subsection (1)
of this section.
(4) Term restricting assignment generally ineffective. Except
as otherwise provided in subsection (5) of this section and ORS
72A.3030 and section 69 of this 2001 Act, and subject to
subsection (8) of this section, a term in an agreement between an
Enrolled Senate Bill 171 (SB 171-ACCA) Page 49
account debtor and an assignor or in a promissory note is
ineffective to the extent that it:
(a) Prohibits, restricts or requires the consent of the account
debtor or person obligated on the promissory note to the
assignment or transfer of, or the creation, attachment,
perfection or enforcement of a security interest in, the account,
chattel paper, payment intangible or promissory note; or
(b) Provides that the assignment or transfer or the creation,
attachment, perfection or enforcement of the security interest
may give rise to a default, breach, right of recoupment, claim,
defense, termination, right of termination or remedy under the
account, chattel paper, payment intangible or promissory note.
(5) Inapplicability of subsection (4) of this section to
certain sales. Subsection (4) of this section does not apply to
the sale of a payment intangible or promissory note.
(6) Legal restrictions on assignment generally ineffective.
Except as otherwise provided in ORS 72A.3030 and section 69 of
this 2001 Act and subject to subsections (8) and (9) of this
section, a rule of law, statute or regulation that prohibits,
restricts or requires the consent of a government, governmental
body or official, or account debtor to the assignment or transfer
of, or creation of a security interest in, an account or chattel
paper is ineffective to the extent that the rule of law, statute
or regulation:
(a) Prohibits, restricts or requires the consent of the
government, governmental body or official, or account debtor to
the assignment or transfer of, or the creation, attachment,
perfection or enforcement of a security interest in the account
or chattel paper; or
(b) Provides that the assignment or transfer or the creation,
attachment, perfection or enforcement of the security interest
may give rise to a default, breach, right of recoupment, claim,
defense, termination, right of termination or remedy under the
account or chattel paper.
(7) Subsection (2)(c) of this section not waivable. Subject to
subsection (8) of this section, an account debtor may not waive
or vary its option under subsection (2)(c) of this section.
(8) Rule for individual under other law. This section is
subject to law other than this chapter which establishes a
different rule for an account debtor who is an individual and who
incurred the obligation primarily for personal, family or
household purposes.
(9) Inapplicability. (a) This section does not apply to the
assignment of a health-care-insurance receivable.
(b) Subsections (4) and (6) of this section do not apply to the
assignment or transfer of, or the creation of a security interest
in, a claim or right to receive compensation for injuries or
sickness as described in 26 U.S.C. 104(a)(2), provided that such
transaction constitutes a sale of such claim or right. The
limitation in this paragraph is intended to leave to the court
the determination of the proper rules in such cases. The court
may not infer from that limitation the nature of the proper rule
in such cases and may continue to apply established approaches.
(c) Subsections (4) and (6) of this section do not apply to the
following:
(A) The assignment or transfer of, or the creation of a
security interest in, a claim or right to receive compensation
for injuries or sickness as described in 26 U.S.C. 104(a)(1);
Enrolled Senate Bill 171 (SB 171-ACCA) Page 50
(B) The assignment or transfer of, or the creation of a
security interest in, a claim or right to receive benefits under
a special needs trust as described in 42 U.S.C. 1396p(d)(4); or
(C) The assignment or transfer of, or the creation, attachment,
perfection or enforcement of a security interest in, the
benefits, rights, privileges or options accruing under an annuity
policy, to the extent that the annuity policy provides for such a
restriction and the restriction is permitted under ORS 743.049.
(d) Subsection (6) of this section does not apply to the
assignment or transfer of, or the creation, attachment,
perfection or enforcement of a security interest in, a right when
the transfer of the right is prohibited or restricted by ORS
147.325, 461.250 (7) or 656.234, to the extent that ORS 147.325,
461.250 (7) or 656.234 is inconsistent with subsection (6) of
this section.
(10) Section prevails over inconsistent law. Except to the
extent otherwise provided in subsection (9) of this section, this
section prevails over any inconsistent provision of an existing
or future statute unless the provision refers expressly to this
section and states that the provision prevails over this
section. + }
SECTION 69. { + 9-407. Restrictions on creation or
enforcement of security interest in leasehold interest or in
lessor's residual interest. (1) Term restricting assignment
generally ineffective. Except as otherwise provided in
subsection (2) of this section, a term in a lease agreement is
ineffective to the extent that it:
(a) Prohibits, restricts or requires the consent of a party to
the lease to the assignment or transfer of, or the creation,
attachment, perfection or enforcement of a security interest in,
an interest of a party under the lease contract or in the
lessor's residual interest in the goods; or
(b) Provides that the assignment or transfer or the creation,
attachment, perfection or enforcement of the security interest
may give rise to a default, breach, right of recoupment, claim,
defense, termination, right of termination or remedy under the
lease.
(2) Effectiveness of certain terms. Except as otherwise
provided in ORS 72A.3030 (7), a term described in subsection
(1)(b) of this section is effective to the extent that there is:
(a) A transfer by the lessee of the lessee's right of
possession or use of the goods in violation of the term; or
(b) A delegation of a material performance of either party to
the lease contract in violation of the term.
(3) Security interest not material impairment. The creation,
attachment, perfection or enforcement of a security interest in
the lessor's interest under the lease contract or the lessor's
residual interest in the goods is not a transfer that materially
impairs the lessee's prospect of obtaining return performance or
materially changes the duty of or materially increases the burden
or risk imposed on the lessee within the purview of ORS 72A.3030
(4) unless, and then only to the extent that, enforcement
actually results in a delegation of material performance of the
lessor. + }
SECTION 70. { + 9-408. Restrictions on assignment of
promissory notes, health-care-insurance receivables, and certain
general intangibles ineffective. (1) Term restricting assignment
generally ineffective. Except as otherwise provided in subsection
(2) of this section, a term in a promissory note or in an
agreement between an account debtor and a debtor which relates to
Enrolled Senate Bill 171 (SB 171-ACCA) Page 51
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:
(a) Would impair the creation, attachment or perfection of a
security interest; or
(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.
(2) Applicability of subsection (1) of this section to sales of
certain rights to payment. Subsection (1) of this section 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.
(3) Legal restrictions on assignment generally ineffective. A
rule of law, statute or regulation 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 regulation:
(a) Would impair the creation, attachment or perfection of a
security interest; or
(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.
(4) Limitation on ineffectiveness under subsections (1) and (3)
of this section. 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 regulation described in
subsection (3) of this section would be effective under law other
than this chapter but is ineffective under subsection (1) or (3)
of this section, the creation, attachment or perfection of a
security interest in the promissory note, health-care-insurance
receivable or general intangible:
(a) Is not enforceable against the person obligated on the
promissory note or the account debtor;
(b) Does not impose a duty or obligation on the person
obligated on the promissory note or the account debtor;
(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;
(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;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 52
(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
(f) Does not entitle the secured party to enforce the security
interest in the promissory note, health-care-insurance receivable
or general intangible.
(5) Inapplicability. (a) Subsections (1) and (3) of this
section do not apply to the assignment or transfer of, or the
creation of a security interest in, a claim or right to receive
compensation for injuries or sickness as described in 26 U.S.C.
104(a)(2), provided that such transaction constitutes a sale of
such claim or right. The limitation in this paragraph is intended
to leave to the court the determination of the proper rules in
such cases. The court may not infer from that limitation the
nature of the proper rule in such cases and may continue to apply
established approaches.
(b) Subsections (1) and (3) of this section do not apply to the
following:
(A) The assignment or transfer of, or the creation of a
security interest in, a claim or right to receive compensation
for injuries or sickness as described in 26 U.S.C. 104(a)(1);
(B) The assignment or transfer of, or the creation of a
security interest in, a claim or right to receive benefits under
a special needs trust as described in 42 U.S.C. 1396p(d)(4); or
(C) The assignment or transfer of, or the creation, attachment,
perfection or enforcement of a security interest in, the
benefits, rights, privileges or options accruing under an annuity
policy, to the extent that the annuity policy provides for such a
restriction and the restriction is permitted under ORS 743.049.
(c) Subsection (3) of this section does not apply to the
assignment or transfer of, or the creation, attachment,
perfection or enforcement of a security interest in, a right when
the transfer of the right is prohibited or restricted by ORS
147.325, 461.250 (7) or 656.234, to the extent that ORS 147.325,
461.250 (7) or 656.234 is inconsistent with subsection (3) of
this section.
(6) Section prevails over inconsistent law. Except to the
extent otherwise provided in subsection (5) of this section, this
section prevails over any inconsistent provision of an existing
or future statute unless the provision refers expressly to this
section and states that the provision prevails over this
section. + }
SECTION 71. { + 9-409. Restrictions on assignment of
letter-of-credit rights ineffective. (1) Term or law restricting
assignment generally ineffective. A term in a letter of credit or
a rule of law, statute, regulation, 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, regulation, custom or practice:
(a) Would impair the creation, attachment or perfection of a
security interest in the letter-of-credit right; or
(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.
(2) Limitation on ineffectiveness under subsection (1) of this
section. To the extent that a term in a letter of credit is
Enrolled Senate Bill 171 (SB 171-ACCA) Page 53
ineffective under subsection (1) of this section 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:
(a) Is not enforceable against the applicant, issuer, nominated
person or transferee beneficiary;
(b) Imposes no duties or obligations on the applicant, issuer,
nominated person or transferee beneficiary; and
(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. + }
{ +
FILING + }
{ +
(Filing Office; Contents and + }
{ +
Effectiveness of Financing Statement) + }
SECTION 72. { + 9-501. Filing office. (1) Filing offices.
Except as otherwise provided in subsection (2) of this section,
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:
(a) The office designated for the filing or recording of a
record of a mortgage on the related real property, if:
(A) The collateral is as-extracted collateral or timber to be
cut; or
(B) The financing statement is filed as a fixture filing and
the collateral is goods that are or are to become fixtures; or
(b) The office of the Secretary of State, 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.
(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 Secretary of State. The financing
statement also constitutes a fixture filing as to the collateral
indicated in the financing statement which is or is to become
fixtures. + }
SECTION 73. { + 9-502. Contents of financing statement;
record of mortgage as financing statement; time of filing
financing statement. (1) Sufficiency of financing statement.
Subject to subsection (2) of this section, a financing statement
is sufficient only if it:
(a) Provides the name of the debtor;
(b) Provides the name of the secured party or a representative
of the secured party; and
(c) Indicates the collateral covered by the financing
statement.
(2) Real-property-related financing statements. Except as
otherwise provided in section 72 (2) of this 2001 Act, to be
sufficient, a financing statement that covers as-extracted
collateral or timber to be cut, or which is filed as a fixture
Enrolled Senate Bill 171 (SB 171-ACCA) Page 54
filing and covers goods that are or are to become fixtures, must
satisfy subsection (1) of this section and also:
(a) Indicate that it covers this type of collateral;
(b) Indicate that it is to be filed for record in the real
property records;
(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
(d) If the debtor does not have an interest of record in the
real property, provide the name of a record owner.
(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:
(a) The record indicates the goods or accounts that it covers;
(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;
(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
(d) The record is duly recorded.
(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. + }
SECTION 74. { + 9-503. Name of debtor and secured party. (1)
Sufficiency of debtor's name. A financing statement sufficiently
provides the name of the debtor:
(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;
(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;
(c) If the debtor is a trust or a trustee acting with respect
to property held in trust, only if the financing statement:
(A) 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
(B) 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
(d) In other cases:
(A) If the debtor has a name, only if it provides the
individual or organizational name of the debtor; and
(B) 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.
(2) Additional debtor-related information. A financing
statement that provides the name of the debtor in accordance with
subsection (1) of this section is not rendered ineffective by the
absence of:
(a) A trade name or other name of the debtor; or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 55
(b) Unless required under subsection (1)(d)(B) of this section,
names of partners, members, associates or other persons
comprising the debtor.
(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.
(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.
(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. + }
SECTION 75. { + 9-504. Indication of collateral. A financing
statement sufficiently indicates the collateral that it covers if
the financing statement provides:
(1) A description of the collateral pursuant to section 8 of
this 2001 Act; or
(2) An indication that the financing statement covers all
assets or all personal property. + }
SECTION 76. { + 9-505. Filing and compliance with other
statutes and treaties for consignments, leases, other bailments
and other transactions. (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 section 31 (1) of this 2001 Act, 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. '
(2) Effect of financing statement under subsection (1) of this
section. Sections 72 to 98 of this 2001 Act apply to the filing
of a financing statement under subsection (1) of this section
and, as appropriate, to compliance that is equivalent to filing a
financing statement under section 31 (2) of this 2001 Act, 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. + }
SECTION 77. { + 9-506. Effect of errors or omissions. (1)
Minor errors and omissions. A financing statement substantially
satisfying the requirements of sections 72 to 98 of this 2001 Act
is effective, even if it has minor errors or omissions, unless
the errors or omissions make the financing statement seriously
misleading.
(2) Financing statement seriously misleading. Except as
otherwise provided in subsection (3) of this section, a financing
statement that fails sufficiently to provide the name of the
debtor in accordance with section 74 (1) of this 2001 Act is
seriously misleading.
(3) Financing statement not seriously misleading. Except as
otherwise provided in subsection (4) of this section, 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 section 74 (1)
Enrolled Senate Bill 171 (SB 171-ACCA) Page 56
of this 2001 Act, the name provided does not make the financing
statement seriously misleading.
(4) If the filing office's standard search logic so changes
that a search of the records of the filing office under the
debtor's correct name, using the changed search logic, would not
disclose a financing statement previously deemed not to be
seriously misleading by reason of subsection (3) of this section,
the financing statement is effective except against a purchaser
of the collateral which gives value in reasonable reliance upon a
search using the changed search logic.
(5) 'Debtor's correct name.' For purposes of section 79 (2) of
this 2001 Act, the 'debtor's correct name' in subsections (3) and
(5) of this section means the correct name of the new debtor. + }
SECTION 78. { + 9-507. Effect of certain events on
effectiveness of financing statement. (1) Disposition. A filed
financing statement remains effective with respect to collateral
that is sold, exchanged, leased, licensed or otherwise disposed
of and in which a security interest or agricultural lien
continues, even if the secured party knows of or consents to the
disposition.
(2) Information becoming seriously misleading. Except as
otherwise provided in subsection (3) of this section and sections
77 (4) and 79 of this 2001 Act, a financing statement is not
rendered ineffective if, after the financing statement is filed,
the information provided in the financing statement becomes
seriously misleading under section 77 of this 2001 Act.
(3) Change in debtor's name. If a debtor so changes its name
that a filed financing statement becomes seriously misleading
under section 77 of this 2001 Act:
(a) The financing statement is effective to perfect a security
interest in collateral acquired by the debtor before, or within
four months after, the change; and
(b) The financing statement is not effective to perfect a
security interest in collateral acquired by the debtor more than
four months after the change, unless an amendment to the
financing statement which renders the financing statement not
seriously misleading is filed within four months after the
change. + }
SECTION 79. { + 9-508. Effectiveness of financing statement
if new debtor becomes bound by security agreement. (1) Financing
statement naming original debtor. Except as otherwise provided in
this section, a filed financing statement naming an original
debtor is effective to perfect a security interest in collateral
in which a new debtor has or acquires rights to the extent that
the financing statement would have been effective had the
original debtor acquired rights in the collateral.
(2) Financing statement becoming seriously misleading. If the
difference between the name of the original debtor and that of
the new debtor causes a filed financing statement that is
effective under subsection (1) of this section to be seriously
misleading under section 77 of this 2001 Act:
(a) The financing statement is effective to perfect a security
interest in collateral acquired by the new debtor before, and
within four months after, the new debtor becomes bound under
section 13 (4) of this 2001 Act; and
(b) The financing statement is not effective to perfect a
security interest in collateral acquired by the new debtor more
than four months after the new debtor becomes bound under section
13 (4) of this 2001 Act unless an initial financing statement
Enrolled Senate Bill 171 (SB 171-ACCA) Page 57
providing the name of the new debtor is filed before the
expiration of that time.
(3) When section not applicable. This section does not apply to
collateral as to which a filed financing statement remains
effective against the new debtor under section 78 (1) of this
2001 Act. + }
SECTION 80. { + 9-509. Persons entitled to file a record. (1)
Person entitled to file record. A person may file an initial
financing statement, amendment that adds collateral covered by a
financing statement, or amendment that adds a debtor to a
financing statement only if:
(a) The debtor authorizes the filing in an authenticated record
or pursuant to subsection (2) or (3) of this section; or
(b) The person holds an agricultural lien that has become
effective at the time of filing and the financing statement
covers only collateral in which the person holds an agricultural
lien.
(2) Security agreement as authorization. By authenticating or
becoming bound as debtor by a security agreement, a debtor or new
debtor authorizes the filing of an initial financing statement,
and an amendment, covering:
(a) The collateral described in the security agreement; and
(b) Property that becomes collateral under section 35 (1)(b) of
this 2001 Act, whether or not the security agreement expressly
covers proceeds.
(3) Acquisition of collateral as authorization. By acquiring
collateral in which a security interest or agricultural lien
continues under section 35 (1)(a) of this 2001 Act, a debtor
authorizes the filing of an initial financing statement, and an
amendment, covering the collateral and property that becomes
collateral under section 35 (1)(b) of this 2001 Act.
(4) Person entitled to file certain amendments. A person may
file an amendment other than an amendment that adds collateral
covered by a financing statement or an amendment that adds a
debtor to a financing statement only if:
(a) The secured party of record authorizes the filing; or
(b) The amendment is a termination statement for a financing
statement as to which the secured party of record has failed to
file or send a termination statement as required by section 84
(1) or (3) of this 2001 Act, the debtor authorizes the filing,
and the termination statement indicates that the debtor
authorized it to be filed.
(5) Multiple secured parties of record. If there is more than
one secured party of record for a financing statement, each
secured party of record may authorize the filing of an amendment
under subsection (4) of this section. + }
SECTION 81. { + 9-510. Effectiveness of filed record. (1)
Filed record effective if authorized. A filed record is effective
only to the extent that it was filed by a person that may file it
under section 80 of this 2001 Act.
(2) Authorization by one secured party of record. A record
authorized by one secured party of record does not affect the
financing statement with respect to another secured party of
record.
(3) Continuation statement not timely filed. A continuation
statement that is not filed within the six-month period
prescribed by section 86 (4) of this 2001 Act is ineffective. + }
SECTION 82. { + 9-511. Secured party of record. (1) Secured
party of record. A secured party of record with respect to a
financing statement is a person whose name is provided as the
Enrolled Senate Bill 171 (SB 171-ACCA) Page 58
name of the secured party or a representative of the secured
party in an initial financing statement that has been filed. If
an initial financing statement is filed under section 85 (1) of
this 2001 Act, the assignee named in the initial financing
statement is the secured party of record with respect to the
financing statement.
(2) Amendment naming secured party of record. If an amendment
of a financing statement which provides the name of a person as a
secured party or a representative of a secured party is filed,
the person named in the amendment is a secured party of record.
If an amendment is filed under section 85 (2) of this 2001 Act,
the assignee named in the amendment is a secured party of record.
(3) Amendment deleting secured party of record. A person
remains a secured party of record until the filing of an
amendment of the financing statement which deletes the
person. + }
SECTION 83. { + 9-512. Amendment of financing statement. + }
{ + (1) Amendment of information in financing statement. Subject
to section 80 of this 2001 Act, a person may add or delete
collateral covered by, continue or terminate the effectiveness
of, or, subject to subsection (5) of this section, otherwise
amend the information provided in, a financing statement by
filing an amendment that:
(a) Identifies, by its file number, the initial financing
statement to which the amendment relates; and
(b) If the amendment relates to an initial financing statement
filed or recorded in a filing office described in section 72
(1)(a) of this 2001 Act, provides the information specified in
section 73 (2) of this 2001 Act. + }
{ + (2) Period of effectiveness not affected. Except as
otherwise provided in section 86 of this 2001 Act, the filing of
an amendment does not extend the period of effectiveness of the
financing statement.
(3) Effectiveness of amendment adding collateral. A financing
statement that is amended by an amendment that adds collateral is
effective as to the added collateral only from the date of the
filing of the amendment.
(4) Effectiveness of amendment adding debtor. A financing
statement that is amended by an amendment that adds a debtor is
effective as to the added debtor only from the date of the filing
of the amendment.
(5) Certain amendments ineffective. An amendment is ineffective
to the extent it:
(a) Purports to delete all debtors and fails to provide the
name of a debtor to be covered by the financing statement; or
(b) Purports to delete all secured parties of record and fails
to provide the name of a new secured party of record. + }
SECTION 84. { + 9-513. Termination statement. (1) Consumer
goods. A secured party shall cause the secured party of record
for a financing statement to file a termination statement for the
financing statement if the financing statement covers consumer
goods and:
(a) There is no obligation secured by the collateral covered by
the financing statement and no commitment to make an advance,
incur an obligation, or otherwise give value; or
(b) The debtor did not authorize the filing of the initial
financing statement.
(2) Time for compliance with subsection (1) of this section.
To comply with subsection (1) of this section, a secured party
Enrolled Senate Bill 171 (SB 171-ACCA) Page 59
shall cause the secured party of record to file the termination
statement:
(a) Within one month after there is no obligation secured by
the collateral covered by the financing statement and no
commitment to make an advance, incur an obligation or otherwise
give value; or
(b) If earlier, within 20 days after the secured party receives
an authenticated demand from a debtor.
(3) Other collateral. In cases not governed by subsection (1)
of this section, within 20 days after a secured party receives an
authenticated demand from a debtor, the secured party shall cause
the secured party of record for a financing statement to send to
the debtor a termination statement for the financing statement or
file the termination statement in the filing office if:
(a) Except in the case of a financing statement covering
accounts or chattel paper that has been sold or goods that are
the subject of a consignment, there is no obligation secured by
the collateral covered by the financing statement and no
commitment to make an advance, incur an obligation, or otherwise
give value;
(b) The financing statement covers accounts or chattel paper
that has been sold but as to which the account debtor or other
person obligated has discharged its obligation;
(c) The financing statement covers goods that were the subject
of a consignment to the debtor but are not in the debtor's
possession; or
(d) The debtor did not authorize the filing of the initial
financing statement.
(4) Effect of filing termination statement. Except as otherwise
provided in section 81 of this 2001 Act, upon the filing of a
termination statement with the filing office, the financing
statement to which the termination statement relates ceases to be
effective. Except as otherwise provided in section 81 of this
2001 Act, for purposes of sections 90 (7), 93 (1) and 94 (3) of
this 2001 Act, the filing with the filing office of a termination
statement relating to a financing statement that indicates that
the debtor is a transmitting utility also causes the
effectiveness of the financing statement to lapse. + }
SECTION 85. { + 9-514. Assignment of powers of secured party
of record. (1) Assignment reflected on initial financing
statement. Except as otherwise provided in subsection (3) of
this section, an initial financing statement may reflect an
assignment of all of the secured party's power to authorize an
amendment to the financing statement by providing the name and
mailing address of the assignee as the name and address of the
secured party.
(2) Assignment of filed financing statement. Except as
otherwise provided in subsection (3) of this section, a secured
party of record may assign of record all or part of its power to
authorize an amendment to a financing statement by filing in the
filing office an amendment of the financing statement which:
(a) Identifies, by its file number, the initial financing
statement to which it relates;
(b) Provides the name of the assignor; and
(c) Provides the name and mailing address of the assignee.
(3) Assignment of record of mortgage. An assignment of record
of a security interest in a fixture covered by a record of a
mortgage which is effective as a financing statement filed as a
fixture filing under section 73 (3) of this 2001 Act may be made
only by an assignment of record of the mortgage in the manner
Enrolled Senate Bill 171 (SB 171-ACCA) Page 60
provided by law of this state other than the Uniform Commercial
Code. + }
SECTION 86. { + 9-515. Duration and effectiveness of
financing statement; effect of lapsed financing statement;
renewal notice. (1) Five-year effectiveness. Except as otherwise
provided in subsections (2), (5), (6) and (7) of this section, a
filed financing statement is effective for a period of five years
after the date of filing.
(2) Public-finance or manufactured-home transaction. Except as
otherwise provided in subsections (5), (6) and (7) of this
section, an initial financing statement filed in connection with
a public-finance transaction or manufactured-home transaction is
effective for a period of 30 years after the date of filing if it
indicates that it is filed in connection with a public-finance
transaction or manufactured-home transaction.
(3) Lapse and continuation of financing statement. The
effectiveness of a filed financing statement lapses on the
expiration of the period of its effectiveness unless before the
lapse a continuation statement is filed pursuant to subsection
(4) of this section. Upon lapse, a financing statement ceases to
be effective and any security interest or agricultural lien that
was perfected by the financing statement becomes unperfected,
unless the security interest is perfected otherwise. If the
security interest or agricultural lien becomes unperfected upon
lapse, it is deemed never to have been perfected as against a
purchaser of the collateral for value.
(4) When continuation statement may be filed. A continuation
statement may be filed only within six months before the
expiration of the five-year period specified in subsection (1) of
this section or the 30-year period specified in subsection (2) of
this section, whichever is applicable.
(5) Effect of filing continuation statement. Except as
otherwise provided in section 81 of this 2001 Act, upon timely
filing of a continuation statement, the effectiveness of the
initial financing statement continues for a period of five years
commencing on the day on which the financing statement would have
become ineffective in the absence of the filing. Upon the
expiration of the five-year period, the financing statement
lapses in the same manner as provided in subsection (3) of this
section, unless, before the lapse, another continuation statement
is filed pursuant to subsection (4) of this section. Succeeding
continuation statements may be filed in the same manner to
continue the effectiveness of the initial financing statement.
(6) Transmitting utility financing statement. If a debtor is a
transmitting utility and a filed financing statement so
indicates, the financing statement is effective until a
termination statement is filed.
(7) Record of mortgage as financing statement. A record of a
mortgage that is effective as a financing statement filed as a
fixture filing under section 73 (3) of this 2001 Act remains
effective as a financing statement filed as a fixture filing
until the mortgage is released or satisfied of record or its
effectiveness otherwise terminates as to the real property. + }
SECTION 86a. { + Not less than three months or more than six
months before the expiration of any financing statement,
effective financing statement as defined in ORS 79.6020 or
continuation thereof, the Secretary of State shall mail a renewal
notice to the secured party or assignee of record, if any, at the
address indicated on the financing statement, effective financing
Enrolled Senate Bill 171 (SB 171-ACCA) Page 61
statement, assignment thereof or amendment thereto. The renewal
notice shall include:
(1) The file number and expiration date of the financing
statement or effective financing statement;
(2) The name of the debtor; and
(3) A statement that the financing statement or effective
financing statement may be continued by filing a continuation
statement or initial financing statement under section 191 or 192
of this 2001 Act. + }
SECTION 87. { + 9-516. What constitutes filing; effectiveness
of filing. (1) What constitutes filing. Except as otherwise
provided in subsection (2) of this section, communication of a
record to and receipt by a filing office and tender of the filing
fee or acceptance of the record by the filing office constitutes
filing.
(2) Refusal to accept record; filing does not occur. Filing
does not occur with respect to a record that a filing office
refuses to accept because:
(a) The record is not communicated by a method or medium of
communication authorized by the filing office;
(b) An amount equal to or greater than the applicable filing
fee is not tendered;
(c) The filing office is unable to index the record because:
(A) In the case of an initial financing statement, the record
does not provide a name for the debtor;
(B) In the case of an amendment or correction statement, the
record:
(i) Does not identify the initial financing statement as
required by section 83 or 89 of this 2001 Act, as applicable; or
(ii) Identifies an initial financing statement whose
effectiveness has lapsed under section 86 of this 2001 Act and
the filing office is that described in section 72 (1)(b) of this
2001 Act;
(C) In the case of an initial financing statement that provides
the name of a debtor identified as an individual or an amendment
that provides a name of a debtor identified as an individual
which was not previously provided in the financing statement to
which the record relates, the record does not identify the
debtor's last name; or
(D) In the case of a record filed or recorded in the filing
office described in section 72 (1)(a) of this 2001 Act, the
record does not provide a sufficient description of the real
property to which it relates;
(d) In the case of an initial financing statement or an
amendment that adds a secured party of record, the record does
not provide a name and mailing address for the secured party of
record;
(e) In the case of an initial financing statement or an
amendment that provides a name of a debtor which was not
previously provided in the financing statement to which the
amendment relates, the record does not:
(A) Provide a mailing address for the debtor, unless the
initial financing statement or amendment is included in a
mortgage and the filing office is that described in section 72
(1)(a) of this 2001 Act;
(B) Indicate whether the debtor is an individual or an
organization, unless the initial financing statement or amendment
is included in a mortgage and the filing office is that described
in section 72 (1)(a) of this 2001 Act; or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 62
(C) If the filing office is that described in section 72 (1)(b)
this 2001 Act and the financing statement indicates that the
debtor is an organization, provide:
(i) A type of organization for the debtor;
(ii) A jurisdiction of organization for the debtor or, as an
alternative when the debtor is not a registered organization, an
indication that the debtor is not a registered organization; or
(iii) An organizational identification number for the debtor or
indicate that the debtor has none;
(f) In the case of an assignment reflected in an initial
financing statement under section 85 (1) of this 2001 Act or an
amendment filed under section 85 (2) of this 2001 Act, the record
does not provide a name and mailing address for the assignee; or
(g) In the case of a continuation statement, the record is not
filed within the six-month period prescribed by section 86 (4) of
this 2001 Act and the filing office is that described in section
72 (1)(b) of this 2001 Act.
(3) Rules applicable to subsection (2) of this section. For
purposes of subsection (2) of this section:
(a) A record does not provide information if the filing office
is unable to read or decipher the information; and
(b) A record that does not indicate that it is an amendment or
identify an initial financing statement to which it relates, as
required by section 83, 85 or 89 of this 2001 Act, is an initial
financing statement.
(4) Refusal to accept record; record effective as filed record.
A record that is communicated to and received by the filing
office with tender of the filing fee under subsection (1) of this
section, but which the filing office refuses to accept for a
reason other than one set forth in subsection (2) of this
section, is effective as a filed record except as against a
purchaser of the collateral which gives value in reasonable
reliance upon the absence of the record from the files. + }
SECTION 88. { + 9-517. Effect of indexing errors. The failure
of the filing office to index a record correctly does not affect
the effectiveness of the filed record. + }
SECTION 89. { + 9-518. Claim concerning inaccurate or
wrongfully filed record. (1) Correction statement. A person may
file in the filing office a correction statement with respect to
a record indexed there under the person's name if the person
believes that the record is inaccurate or was wrongfully filed.
(2) Sufficiency of correction statement. A correction statement
must:
(a) Identify the record to which it relates by the file number
assigned to the initial financing statement to which the record
relates;
(b) Indicate that it is a correction statement;
(c) Provide the basis for the person's belief that the record
is inaccurate and indicate the manner in which the person
believes the record should be amended to cure any inaccuracy or
provide the basis for the person's belief that the record was
wrongfully filed; and
(d) Indicate the name of the debtor and the secured party.
(3) Record not affected by correction statement. The filing of
a correction statement does not affect the effectiveness of an
initial financing statement or other filed record. + }
{ +
(Duties and Operation of Filing Office) + }
Enrolled Senate Bill 171 (SB 171-ACCA) Page 63
SECTION 90. { + 9-519. Numbering, maintaining and indexing
records; communicating information provided in records. (1)
Filing office duties. For each record filed in a filing office,
the filing office shall:
(a) Assign a unique number to the filed record;
(b) Create a record that bears the number assigned to the filed
record and the date and time of filing;
(c) Maintain the filed record for public inspection; and
(d) Index the filed record in accordance with subsections (3),
(4) and (5) of this section.
(2) File number. Except as otherwise provided in subsection (9)
of this section, a file number assigned after January 1, 2004,
must include a digit that:
(a) Is mathematically derived from or related to the other
digits of the file number; and
(b) Aids the filing office in determining whether a number
communicated as the file number includes a single-digit or
transpositional error.
(3) Indexing: general. Except as otherwise provided in
subsections (4) and (5) of this section, the filing office shall:
(a) Index an initial financing statement according to the name
of the debtor and index all filed records relating to the initial
financing statement in a manner that associates with one another
an initial financing statement and all filed records relating to
the initial financing statement; and
(b) Index a record that provides a name of a debtor which was
not previously provided in the financing statement to which the
record relates also according to the name that was not previously
provided.
(4) Indexing: real-property-related financing statement. If a
financing statement is filed as a fixture filing or covers
as-extracted collateral or timber to be cut, it must be filed for
record and the filing office shall index it:
(a) Under the names of the debtor and of each owner of record
shown on the financing statement as if they were the mortgagors
under a mortgage of the real property described; and
(b) To the extent that the law of this state provides for
indexing of records of mortgages under the name of the mortgagee,
under the name of the secured party as if the secured party were
the mortgagee thereunder, or, if indexing is by description, as
if the financing statement were a record of a mortgage of the
real property described.
(5) Indexing: Real-property-related assignment. If a financing
statement is filed as a fixture filing or covers as-extracted
collateral or timber to be cut, the filing office shall index an
assignment filed under section 85 (1) of this 2001 Act or an
amendment filed under section 85 (2) of this 2001 Act:
(a) Under the name of the assignor as grantor; and
(b) To the extent that the law of this state provides for
indexing a record of the assignment of a mortgage under the name
of the assignee, under the name of the assignee.
(6) Retrieval and association capability. The filing office
shall maintain a capability:
(a) To retrieve a record by the name of the debtor and by the
file number assigned to the initial financing statement to which
the record relates; and
(b) To associate and retrieve with one another an initial
financing statement and each filed record relating to the initial
financing statement.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 64
(7) Removal of debtor's name. The filing office may not remove
a debtor's name from the index until one year after the
effectiveness of a financing statement naming the debtor lapses
under section 86 of this 2001 Act with respect to all secured
parties of record.
(8) Timeliness of filing office performance. Except as
otherwise provided in subsection (9) of this section, the filing
office shall perform the acts required by subsections (1) to (5)
of this section at the time and in the manner prescribed by
filing-office rule, but not later than two business days after
the filing office receives the record in question or, if the
record is delivered by mail, not later than four business days
after the filing office receives the record.
(9) Subsections (2) and (8) of this section do not apply to a
filing office described in section 72 (1)(a) of this 2001
Act. + }
SECTION 91. { + 9-520. Acceptance and refusal to accept
record. (1) Mandatory refusal to accept record. A filing office
shall refuse to accept a record for filing for a reason set forth
in section 87 (2) of this 2001 Act and may refuse to accept a
record for filing only for a reason set forth in section 87 (2)
of this 2001 Act.
(2) Communication concerning refusal. If a filing office
refuses to accept a record for filing, it shall communicate to
the person that presented the record the fact of and reason for
the refusal and the date and time the record would have been
filed had the filing office accepted it. The communication must
be made at the time and in the manner prescribed by filing-office
rule but, in the case of a filing office described in section 72
(1)(b) of this 2001 Act, in no event more than two business days
after the filing office receives the record or, if the record is
delivered by mail, four business days after the filing office
receives the record.
(3) When filed financing statement effective. A filed financing
statement satisfying section 73 (1) and (2) of this 2001 Act is
effective, even if the filing office is required to refuse to
accept it for filing under subsection (1) of this section.
However, section 58 of this 2001 Act applies to a filed financing
statement providing information described in section 87 (2)(e) of
this 2001 Act which is incorrect at the time the financing
statement is filed.
(4) Separate application to multiple debtors. If a record
communicated to a filing office provides information that relates
to more than one debtor, sections 72 to 98 of this 2001 Act apply
as to each debtor separately. + }
SECTION 92. { + 9-521. Uniform form of written financing
statement and amendment. (1) Initial financing statement form. A
filing office that accepts written records may not refuse to
accept a written initial financing statement in the form and
format set forth in the final official text of the 1999 revisions
to Article 9 of the Uniform Commercial Code promulgated by The
American Law Institute and the National Conference of
Commissioners on Uniform State Laws, except for a reason set
forth in section 87 (2) of this 2001 Act.
(2) Amendment form. A filing office that accepts written
records may not refuse to accept a written record in the form and
format set forth in the final official text of the 1999 revisions
to Article 9 of the Uniform Commercial Code promulgated by The
American Law Institute and the National Conference of
Enrolled Senate Bill 171 (SB 171-ACCA) Page 65
Commissioners on Uniform State Laws, except for a reason set
forth in section 87 (2) of this 2001 Act. + }
SECTION 93. { + 9-522. Maintenance and destruction of
records. (1) Post-lapse maintenance and retrieval of
information. The filing office shall maintain a record of the
information provided in a filed financing statement for at least
one year after the effectiveness of the financing statement has
lapsed under section 86 of this 2001 Act with respect to all
secured parties of record. The record must be retrievable by
using the name of the debtor and by using the file number
assigned to the initial financing statement to which the record
relates.
(2) Destruction of written records. Except to the extent that a
statute governing disposition of public records provides
otherwise, the filing office immediately may destroy any written
record evidencing a financing statement. However, if the filing
office destroys a written record, it shall maintain another
record of the financing statement which complies with subsection
(1) of this section. + }
SECTION 94. { + 9-523. Information from filing office; sale
or license of records. (1) Acknowledgment of filing written
record. If a person that files a written record requests an
acknowledgment of the filing, the filing office shall send an
image of the record showing the number assigned to the record
pursuant to section 90 (1)(a) of this 2001 Act and the date and
time of the filing of the record to the person indicated on the
financing statement or amendment as the person to whom the
acknowledgment should be sent or, if no person is so indicated,
to the secured party or the person filing the written record.
However, if the person furnishes a copy of the record to the
filing office, the filing office may instead:
(a) Note upon the copy the number assigned to the record
pursuant to section 90 (1)(a) of this 2001 Act and the date and
time of the filing of the record; and
(b) Send the copy to the person indicated on the financing
statement or amendment as the person to whom the acknowledgment
should be sent or, if no person is so indicated, to the secured
party or the person filing the written record.
(2) Acknowledgment of filing other record. If a person files a
record other than a written record, the filing office shall
communicate an acknowledgment to the person indicated on the
financing statement or amendment as the person to whom the
acknowledgment should be sent or, if no person is so indicated,
to the secured party or the person filing the record. The
acknowledgment shall provide:
(a) The information in the record;
(b) The number assigned to the record pursuant to section 90
(1)(a) of this 2001 Act; and
(c) The date and time of the filing of the record.
(3) Communication of requested information. The filing office
shall communicate or otherwise make available in a record the
following information to any person that requests it:
(a) Whether there is on file on a date and time specified by
the filing office, but not a date earlier than five business days
before the filing office receives the request, any financing
statement that:
(A) Designates a particular debtor or, if the request so
states, designates a particular debtor at the address specified
in the request;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 66
(B) Has not lapsed under section 86 of this 2001 Act with
respect to all secured parties of record; and
(C) If the request so states, has lapsed under section 86 of
this 2001 Act and a record of which is maintained by the filing
office under section 93 (1) of this 2001 Act;
(b) The date and time of filing of each financing statement;
(c) The information provided in each financing statement; and
(d) All notices of federal lien or certificates or notices
affecting a lien, if any, filed under ORS 87.806 to 87.831 for a
particular person whose name is identical to the particular
debtor named in the financing statement.
(4) Medium for communicating information. In complying with its
duty under subsection (3) of this section, the filing office may
communicate information in any medium. However, if requested, the
filing office shall communicate information by issuing a record
that can be admitted into evidence in the courts of this state
without extrinsic evidence of its authenticity.
(5) Timeliness of filing office performance. The filing office
described in section 72 (1)(b) of this 2001 Act shall perform the
acts required by subsections (1) to (4) of this section at the
time and in the manner prescribed by filing-office rule, but not
later than two business days after the filing office receives the
request or, if the request is delivered by mail, not later than
four business days after the filing office receives the request.
(6) Public availability of records. At least every two weeks,
the filing office described in section 72 (1)(b) of this 2001 Act
shall offer to sell or license to the public on a nonexclusive
basis, in bulk, copies of all records filed in it under sections
72 to 98 of this 2001 Act. The filing office shall offer the
copies of any record in the medium in which the filing office
maintains the record. The filing office may offer the copies in
additional media. + }
SECTION 95. { + 9-524. Delay by filing office. Delay by the
filing office beyond a time limit prescribed by sections 72 to 98
of this 2001 Act is excused if:
(1) The delay is caused by interruption of communication or
computer facilities, war, emergency conditions, failure of
equipment or other circumstances beyond control of the filing
office; and
(2) The filing office exercises reasonable diligence under the
circumstances. + }
SECTION 96. { + 9-525. Fees. (1) Initial financing statement
or other record: General rule. Except as otherwise provided in
subsection (4) of this section, the nonrefundable fee for filing
and indexing a record under sections 72 to 98 of this 2001 Act is
$10.
(2) Number of names. The number of names required to be indexed
does not affect the amount of the fee in subsection (1) of this
section.
(3) Response to information request. The nonrefundable fee for
responding to a request for information from the filing office,
including for communicating whether there is on file any
financing statement naming a particular debtor, is:
(a) $10 for each distinct debtor name to be searched;
(b) In addition to the fee in paragraph (a) of this subsection,
$5 for copies of Uniform Commercial Code documents relating to
each distinct debtor name to be searched; and
(c) $5 for each request by document number for copies of
Uniform Commercial Code documents.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 67
(4) Record of mortgage. This section does not require a fee
with respect to a record filed or recorded in the filing office
described in section 72 (1)(a) of this 2001 Act. However, the
recording and satisfaction fees that otherwise would be
applicable to the record apply.
(5) The Secretary of State shall adopt rules prescribing fees
for providing summaries and compilations that are not debtor
specific and for providing copies of records, as described in
section 94 (6) of this 2001 Act, that are not debtor
specific. + }
SECTION 97. { + 9-526. Filing-office rules. (1) Adoption of
filing-office rules. The Secretary of State shall adopt and
publish rules applicable to its filing procedures, processes and
operations to implement this chapter. The filing-office rules
must be:
(a) Consistent with this chapter; and
(b) Adopted and published in accordance with ORS 183.310 to
183.550.
(2) Harmonization of rules. To keep the filing-office rules and
practices of the filing office in harmony with the rules and
practices of filing offices in other jurisdictions that enact
substantially sections 72 to 98 of this 2001 Act, and to keep the
technology used by the filing office compatible with the
technology used by filing offices in other jurisdictions that
enact substantially sections 72 to 98 of this 2001 Act, the
Secretary of State, so far as is consistent with the purposes,
policies and provisions of this chapter, in adopting, amending
and repealing filing-office rules, shall:
(a) Consult with filing offices in other jurisdictions that
enact substantially sections 72 to 98 of this 2001 Act;
(b) Consult the most recent version of the Model Rules
promulgated by the International Association of Corporate
Administrators or any successor organization; and
(c) Take into consideration the rules and practices of, and the
technology used by, filing offices in other jurisdictions that
enact substantially sections 72 to 98 of this 2001 Act. + }
SECTION 98. { + 9-527. Duty to report. The Secretary of State
shall report to the Legislative Assembly on or before January 15
of each odd-numbered year regarding the operation of the filing
office. The report must contain a statement of the extent to
which the filing-office rules are not in harmony with the most
recent version of the Model Rules promulgated by the
International Association of Corporate Administrators, or any
successor organization, and the reasons for these variations. + }
{ +
DEFAULT + }
{ +
(Default and Enforcement of Security Interest) + }
SECTION 99. { + 9-601. Rights after default; judicial
enforcement; consignor or buyer of accounts, chattel paper,
payment intangibles or promissory notes. (1) Rights of secured
party after default. After default, a secured party has the
rights provided in sections 99 to 126 of this 2001 Act and,
except as otherwise provided in section 100 of this 2001 Act,
those provided by agreement of the parties. A secured party:
(a) May reduce a claim to judgment, foreclose, or otherwise
enforce the claim, security interest or agricultural lien by any
available judicial procedure; and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 68
(b) If the collateral is documents, may proceed either as to
the documents or as to the goods they cover.
(2) Rights and duties of secured party in possession or
control. A secured party in possession of collateral or control
of collateral under section 4, 5, 6 or 7 of this 2001 Act has the
rights and duties provided in section 17 of this 2001 Act.
(3) Rights cumulative; simultaneous exercise. The rights under
subsections (1) and (2) of this section are cumulative and may be
exercised simultaneously.
(4) Rights of debtor and obligor. Except as otherwise provided
in subsection (7) of this section and section 103 of this 2001
Act, after default, a debtor and an obligor have the rights
provided in sections 99 to 126 of this 2001 Act and by agreement
of the parties.
(5) Lien of levy after judgment. If a secured party has reduced
its claim to judgment, the lien of any levy that may be made upon
the collateral by virtue of an execution based upon the judgment
relates back to the earliest of:
(a) The date of perfection of the security interest or
agricultural lien in the collateral;
(b) The date of filing a financing statement covering the
collateral; or
(c) Any date specified in a statute under which the
agricultural lien was created.
(6) Execution sale. A sale pursuant to an execution is a
foreclosure of the security interest or agricultural lien by
judicial procedure within the meaning of this section. A secured
party may purchase at the sale and thereafter hold the collateral
free of any other requirements of this chapter.
(7) Consignor or buyer of certain rights to payment. Except as
otherwise provided in section 105 (3) of this 2001 Act, sections
99 to 126 of this 2001 Act impose no duties upon a secured party
that is a consignor or is a buyer of accounts, chattel paper,
payment intangibles or promissory notes. + }
SECTION 100. { + 9-602. Waiver and variance of rights and
duties. Except as otherwise provided in section 122 of this 2001
Act, to the extent that they give rights to a debtor or obligor
and impose duties on a secured party, the debtor or obligor may
not waive or vary the rules stated in the following listed
sections:
(1) Section 17 (2)(d)(C) of this 2001 Act, which deals with use
and operation of the collateral by the secured party;
(2) Section 20 of this 2001 Act, which deals with requests for
an accounting and requests concerning a list of collateral and
statement of account;
(3) Section 105 (3) of this 2001 Act, which deals with
collection and enforcement of collateral;
(4) Sections 106 (1) and 113 (3) of this 2001 Act to the extent
that they deal with application or payment of noncash proceeds of
collection, enforcement or disposition;
(5) Sections 106 (1) and 113 (4) of this 2001 Act to the extent
that they require accounting for or payment of surplus proceeds
of collateral;
(6) Section 107 of this 2001 Act to the extent that it imposes
upon a secured party that takes possession of collateral without
judicial process the duty to do so without breach of the peace;
(7) Sections 108 (2), 109, 111 and 112 of this 2001 Act, which
deal with disposition of collateral;
(8) Section 113 (6) of this 2001 Act, which deals with
calculation of a deficiency or surplus when a disposition is made
Enrolled Senate Bill 171 (SB 171-ACCA) Page 69
to the secured party, a person related to the secured party or a
secondary obligor;
(9) Section 114 of this 2001 Act, which deals with explanation
of the calculation of a surplus or deficiency;
(10) Sections 118, 119 and 120 of this 2001 Act, which deal
with acceptance of collateral in satisfaction of obligation;
(11) Section 121 of this 2001 Act, which deals with redemption
of collateral;
(12) Section 122 of this 2001 Act, which deals with permissible
waivers; and
(13) Sections 123 and 124 of this 2001 Act, which deal with the
secured party's liability for failure to comply with this
chapter. + }
SECTION 101. { + 9-603. Agreement on standards concerning
rights and duties. (1) Agreed standards. The parties may
determine by agreement the standards measuring the fulfillment of
the rights of a debtor or obligor and the duties of a secured
party under a rule stated in section 100 of this 2001 Act if the
standards are not manifestly unreasonable.
(2) Agreed standards inapplicable to breach of peace.
Subsection (1) of this section does not apply to the duty under
section 107 of this 2001 Act to refrain from breaching the
peace. + }
SECTION 102. { + 9-604. Procedure if security agreement
covers real property or fixtures. (1) Enforcement: personal and
real property. If a security agreement covers both personal and
real property, a secured party may proceed:
(a) Under sections 99 to 126 of this 2001 Act as to the
personal property without prejudicing any rights with respect to
the real property; or
(b) As to both the personal property and the real property in
accordance with the rights with respect to the real property, in
which case the other provisions of sections 99 to 126 of this
2001 Act do not apply.
(2) Enforcement: fixtures. Subject to subsection (3) of this
section, if a security agreement covers goods that are or become
fixtures, a secured party may proceed:
(a) Under sections 99 to 126 of this 2001 Act; or
(b) In accordance with the rights with respect to real
property, in which case the other provisions of sections 99 to
126 of this 2001 Act do not apply.
(3) Removal of fixtures. Subject to the other provisions of
sections 99 to 126 of this 2001 Act, if a secured party holding a
security interest in fixtures has priority over all owners and
encumbrancers of the real property, the secured party, after
default, may remove the collateral from the real property.
(4) Injury caused by removal. A secured party that removes
collateral shall promptly reimburse any encumbrancer or owner of
the real property, other than the debtor, for the cost of repair
of any physical injury caused by the removal. The secured party
need not reimburse the encumbrancer or owner for any diminution
in value of the real property caused by the absence of the goods
removed or by any necessity of replacing them. A person entitled
to reimbursement may refuse permission to remove until the
secured party gives adequate assurance for the performance of the
obligation to reimburse. + }
SECTION 103. { + 9-605. Unknown debtor or secondary obligor.
A secured party does not owe a duty based on its status as
secured party:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 70
(1) To a person that is a debtor or obligor, unless the secured
party knows:
(a) That the person is a debtor or obligor;
(b) The identity of the person; and
(c) How to communicate with the person; or
(2) To a secured party or lienholder that has filed a financing
statement against a person, unless the secured party knows:
(a) That the person is a debtor; and
(b) The identity of the person. + }
SECTION 104. { + 9-606. Time of default for agricultural
lien. For purposes of sections 99 to 126 of this 2001 Act, a
default occurs in connection with an agricultural lien at the
time the secured party becomes entitled to enforce the lien in
accordance with the statute under which it was created. + }
SECTION 105. { + 9-607. Collection and enforcement by secured
party. (1) Collection and enforcement generally. If so agreed,
and in any event after default, a secured party:
(a) May notify an account debtor or other person obligated on
collateral to make payment or otherwise render performance to or
for the benefit of the secured party;
(b) May take any proceeds to which the secured party is
entitled under section 35 of this 2001 Act;
(c) May enforce the obligations of an account debtor or other
person obligated on collateral and exercise the rights of the
debtor with respect to the obligation of the account debtor or
other person obligated on collateral to make payment or otherwise
render performance to the debtor, and with respect to any
property that secures the obligations of the account debtor or
other person obligated on the collateral;
(d) If it holds a security interest in a deposit account
perfected by control under section 4 (1)(a) of this 2001 Act, may
apply the balance of the deposit account to the obligation
secured by the deposit account; and
(e) If it holds a security interest in a deposit account
perfected by control under section 4 (1)(b) or (c) of this 2001
Act, may instruct the bank to pay the balance of the deposit
account to or for the benefit of the secured party.
(2) Nonjudicial enforcement of mortgage. If necessary to enable
a secured party to exercise under subsection (1)(c) of this
section the right of a debtor to enforce a mortgage
nonjudicially, the secured party may record in the office in
which a record of the mortgage is recorded the secured party's
sworn affidavit, with a copy of the security agreement attached
thereto. The affidavit shall be in recordable form and state
that:
(a) A default has occurred; and
(b) The secured party is entitled to enforce the mortgage
nonjudicially.
(3) Commercially reasonable collection and enforcement. A
secured party shall proceed in a commercially reasonable manner
if the secured party:
(a) Undertakes to collect from or enforce an obligation of an
account debtor or other person obligated on collateral; and
(b) Is entitled to charge back uncollected collateral or
otherwise to full or limited recourse against the debtor or a
secondary obligor.
(4) Expenses of collection and enforcement. A secured party may
deduct from the collections made pursuant to subsection (3) of
this section reasonable expenses of collection and enforcement,
Enrolled Senate Bill 171 (SB 171-ACCA) Page 71
including reasonable attorney fees and legal expenses incurred by
the secured party.
(5) Duties to secured party not affected. This section does not
determine whether an account debtor, bank or other person
obligated on collateral owes a duty to a secured party. + }
SECTION 106. { + 9-608. Application of proceeds of collection
or enforcement; liability for deficiency and right to surplus.
(1) Application of proceeds, surplus and deficiency if obligation
secured. If a security interest or agricultural lien secures
payment or performance of an obligation, the following rules
apply:
(a) A secured party shall apply or pay over for application the
cash proceeds of collection or enforcement under section 105 of
this 2001 Act in the following order to:
(A) The reasonable expenses of collection and enforcement and,
to the extent provided for by agreement and not prohibited by
law, reasonable attorney fees and legal expenses incurred by the
secured party;
(B) The satisfaction of obligations secured by the security
interest or agricultural lien under which the collection or
enforcement is made; and
(C) The satisfaction of obligations secured by any subordinate
security interest in or other lien on the collateral subject to
the security interest or agricultural lien under which the
collection or enforcement is made if the secured party receives
an authenticated demand for proceeds before distribution of the
proceeds is completed.
(b) If requested by a secured party, a holder of a subordinate
security interest or other lien shall furnish reasonable proof of
the interest or lien within a reasonable time. Unless the holder
complies, the secured party need not comply with the holder's
demand under paragraph (a)(C) of this subsection.
(c) A secured party need not apply or pay over for application
noncash proceeds of collection and enforcement under section 105
of this 2001 Act unless the failure to do so would be
commercially unreasonable. A secured party that applies or pays
over for application noncash proceeds shall do so in a
commercially reasonable manner.
(d) A secured party shall account to and pay a debtor for any
surplus, and the obligor is liable for any deficiency.
(2) No surplus or deficiency in sales of certain rights to
payment. If the underlying transaction is a sale of accounts,
chattel paper, payment intangibles or promissory notes, the
debtor is not entitled to any surplus and the obligor is not
liable for any deficiency. + }
SECTION 107. { + 9-609. Secured party's right to take
possession after default. (1) Possession; rendering equipment
unusable; disposition on debtor's premises. After default, a
secured party:
(a) May take possession of the collateral; and
(b) Without removal, may render equipment unusable and dispose
of collateral on a debtor's premises under section 108 of this
2001 Act.
(2) Judicial and nonjudicial process. A secured party may
proceed under subsection (1) of this section:
(a) Pursuant to judicial process; or
(b) Without judicial process, if it proceeds without breach of
the peace.
(3) Assembly of collateral. If so agreed, and in any event
after default, a secured party may require the debtor to assemble
Enrolled Senate Bill 171 (SB 171-ACCA) Page 72
the collateral and make it available to the secured party at a
place to be designated by the secured party which is reasonably
convenient to both parties. + }
SECTION 108. { + 9-610. Disposition of collateral after
default. (1) Disposition after default. After default, a secured
party may sell, lease, license or otherwise dispose of any or all
of the collateral in its present condition or following any
commercially reasonable preparation or processing.
(2) Commercially reasonable disposition. Every aspect of a
disposition of collateral, including the method, manner, time,
place and other terms, must be commercially reasonable. If
commercially reasonable, a secured party may dispose of
collateral by public or private proceedings, by one or more
contracts, as a unit or in parcels, and at any time and place and
on any terms.
(3) Purchase by secured party. A secured party may purchase
collateral:
(a) At a public disposition; or
(b) At a private disposition only if the collateral is of a
kind that is customarily sold on a recognized market or the
subject of widely distributed standard price quotations.
(4) Warranties on disposition. A contract for sale, lease,
license or other disposition includes the warranties relating to
title, possession, quiet enjoyment and the like which by
operation of law accompany a voluntary disposition of property of
the kind subject to the contract.
(5) Disclaimer of warranties. A secured party may disclaim or
modify warranties under subsection (4) of this section:
(a) In a manner that would be effective to disclaim or modify
the warranties in a voluntary disposition of property of the kind
subject to the contract of disposition; or
(b) By communicating to the purchaser a record evidencing the
contract for disposition and including an express disclaimer or
modification of the warranties.
(6) Record sufficient to disclaim warranties. A record is
sufficient to disclaim warranties under subsection (5) of this
section if it indicates 'There is no warranty relating to title,
possession, quiet enjoyment or the like in this disposition' or
uses words of similar import. + }
SECTION 109. { + 9-611. Notification before disposition of
collateral. (1) 'Notification date.' As used in this section, '
notification date' means the earlier of the date on which:
(a) A secured party sends to the debtor and any secondary
obligor an authenticated notification of disposition; or
(b) The debtor and any secondary obligor waive the right to
notification.
(2) Notification of disposition required. Except as otherwise
provided in subsection (4) of this section, a secured party that
disposes of collateral under section 108 of this 2001 Act shall
send to the persons specified in subsection (3) of this section a
reasonable authenticated notification of disposition.
(3) Persons to be notified. To comply with subsection (2) of
this section, the secured party shall send an authenticated
notification of disposition to:
(a) The debtor;
(b) Any secondary obligor; and
(c) If the collateral is other than consumer goods:
(A) Any other person from which the secured party has received,
before the notification date, an authenticated notification of a
claim of an interest in the collateral;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 73
(B) Any other secured party or lienholder that, 10 days before
the notification date, held a security interest in or other lien
on the collateral perfected by the filing of a financing
statement that:
(i) Identified the collateral;
(ii) Was indexed under the debtor's name as of that date; and
(iii) Was filed in the office in which to file a financing
statement against the debtor covering the collateral as of that
date; and
(C) Any other secured party that, 10 days before the
notification date, held a security interest in the collateral
perfected by compliance with a statute, regulation or treaty
described in section 31 (1) of this 2001 Act.
(4) Subsection (2) of this section inapplicable: Perishable
collateral; recognized market. Subsection (2) of this section
does not apply if the collateral is perishable or threatens to
decline speedily in value or is of a type customarily sold on a
recognized market.
(5) Compliance with subsection (3)(c)(B) of this section. A
secured party complies with the requirement for notification
prescribed by subsection (3)(c)(B) of this section if:
(a) Not later than 20 days or earlier than 30 days before the
notification date, the secured party requests, in a commercially
reasonable manner, information concerning financing statements
indexed under the debtor's name in the office indicated in
subsection (3)(c)(B) of this section; and
(b) Before the notification date, the secured party:
(A) Did not receive a response to the request for information;
or
(B) Received a response to the request for information and sent
an authenticated notification of disposition to each secured
party or other lienholder named in that response whose financing
statement covered the collateral. + }
SECTION 110. { + 9-612. Timeliness of notification before
disposition of collateral. (1) Reasonable time is question of
fact. Except as otherwise provided in subsection (2) of this
section, a notification of disposition sent after default and 15
days or more before the earliest time of disposition, as set
forth in the notification, is sent within a reasonable time
before the disposition.
(2) Ten-day period sufficient in nonconsumer transaction. In a
transaction other than a consumer transaction, a notification of
disposition sent after default and 10 days or more before the
earliest time of disposition set forth in the notification is
sent within a reasonable time before the disposition. + }
SECTION 111. { + 9-613. Contents and form of notification
before disposition of collateral: General. Except in a
consumer-goods transaction, the following rules apply:
(1) The contents of a notification of disposition are
sufficient if the notification:
(a) Indicates the name of the debtor and the name, address and
telephone number of the secured party;
(b) Describes the collateral that is the subject of the
intended disposition;
(c) States the method of intended disposition;
(d) States that the debtor is entitled to an accounting of the
unpaid indebtedness and states the charge, if any, for an
accounting; and
(e) States the time and place of a public disposition or the
time after which any other disposition is to be made.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 74
(2) Whether the contents of a notification that lacks any of
the information specified in subsection (1) of this section are
nevertheless sufficient is a question of fact.
(3) The contents of a notification providing substantially the
information specified in subsection (1) of this section are
sufficient, even if the notification includes:
(a) Information not specified by subsection (1) of this
section; or
(b) Minor errors that are not seriously misleading.
(4) A particular phrasing of the notification is not required.
(5) The following form of notification and the form appearing
in section 112 (3) of this 2001 Act, when completed, provide
sufficient information: + }
_________________________________________________________________
{ +
NOTIFICATION OF DISPOSITION OF COLLATERAL + }
{ + To: (Name of debtor, obligor or other person to which the
notification is sent.)
From: (Name, address and telephone number of secured party.)
Name of Debtor(s): (Include only if debtor(s) are not an
addressee.)
For a public disposition:
We will sell or lease or license, as applicable the (describe
collateral) to the highest qualified bidder in public as follows:
Day and date: ______
Time: ______
Place: ______
For a private disposition:
We will sell or lease or license, as applicable the (describe
collateral) privately sometime after (day and date).
You are entitled to an accounting of the unpaid indebtedness
secured by the property that we intend to sell or lease or
license, as applicable for a charge of $___. You may request an
accounting by calling us at (telephone number). + }
_________________________________________________________________
SECTION 112. { + 9-614. Contents and form of notification
before disposition of collateral: consumer-goods transaction. In
a consumer-goods transaction, the following rules apply:
(1) A notification of disposition must provide the following
information:
(a) The information specified in section 111 (1) of this 2001
Act;
(b) A description of any liability for a deficiency of the
person to which the notification is sent;
(c) A telephone number from which the amount that must be paid
to the secured party to redeem the collateral under section 121
of this 2001 Act is available; and
(d) A telephone number or mailing address from which additional
information concerning the disposition and the obligation secured
is available.
(2) A particular phrasing of the notification is not required.
(3) The following form of notification, when completed,
provides sufficient information:
_________________________________________________________________
(Name and address of secured party)
(Date) + }
{ +
NOTICE OF OUR PLAN TO SELL PROPERTY + }
{ + (Name and address of any obligor who is also a debtor)
Subject: (Identification of Transaction)
Enrolled Senate Bill 171 (SB 171-ACCA) Page 75
We have your (describe collateral), because you broke promises
in our agreement.
For a public disposition:
We will sell (describe collateral) at public sale. A sale could
include a lease or license. The sale will be held as follows:
Day and date: ___
Time: ___
Place: ___
You may attend the sale and bring bidders if you want.
For a private disposition:
We will sell (describe collateral) at private sale sometime
after (date). A sale could include a lease or license.
The money that we get from the sale, after paying our costs,
will reduce the amount you owe. If we get less money than you
owe, you (will or will not, as applicable) still owe us the
difference. If we get more money than you owe, you will get the
extra money, unless we must pay it to someone else.
You can get the property back at any time before we sell it by
paying us the full amount you owe (not just the past due
payments), including our expenses. To learn the exact amount you
must pay, call us at (telephone number).
If you want us to explain to you in writing how we have figured
the amount that you owe us, you may call us at (telephone number)
or write us at (secured party's address) and request a written
explanation. We will charge you $___ for the explanation if we
sent you another written explanation of the amount you owe us
within the last six months.
If you need more information about the sale call us at
(telephone number) or write us at (secured party's address).
We are sending this notice to the following other people who
have an interest in (describe collateral) or who owe money under
your agreement:
(Names of all other debtors and obligors, if any.)
_________________________________________________________________
(4) A notification in the form of subsection (3) of this
section is sufficient, even if the form includes additional
information.
(5) A notification in the form of subsection (3) of this
section is sufficient, even if it includes minor errors in
information not required by subsection (1) of this section,
unless the error is seriously misleading.
(6) If a notification under this section is not in the form of
subsection (3) of this section, law other than this chapter
determines the effect of including information not required by
subsection (1) of this section. + }
SECTION 113. { + 9-615. Application of proceeds of
disposition; liability for deficiency and right to surplus. (1)
Application of proceeds. A secured party shall apply or pay over
for application the cash proceeds of disposition under section
108 of this 2001 Act in the following order to:
(a) The reasonable expenses of retaking, holding, preparing for
disposition, processing and disposing, and, to the extent
provided for by agreement and not prohibited by law, reasonable
attorney fees and legal expenses incurred by the secured party;
(b) The satisfaction of obligations secured by the security
interest or agricultural lien under which the disposition is
made;
(c) The satisfaction of obligations secured by any subordinate
security interest in or other subordinate lien on the collateral
if:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 76
(A) The secured party receives from the holder of the
subordinate security interest or other lien an authenticated
demand for proceeds before distribution of the proceeds is
completed; and
(B) In a case in which a consignor has an interest in the
collateral, the subordinate security interest or other lien is
senior to the interest of the consignor; and
(d) A secured party that is a consignor of the collateral if
the secured party receives from the consignor an authenticated
demand for proceeds before distribution of the proceeds is
completed.
(2) Proof of subordinate interest. If requested by a secured
party, a holder of a subordinate security interest or other lien
shall furnish reasonable proof of the interest or lien within a
reasonable time. Unless the holder does so, the secured party
need not comply with the holder's demand under subsection (1)(c)
of this section.
(3) Application of noncash proceeds. A secured party need not
apply or pay over for application noncash proceeds of disposition
under section 108 of this 2001 Act unless the failure to do so
would be commercially unreasonable. A secured party that applies
or pays over for application noncash proceeds shall do so in a
commercially reasonable manner.
(4) Surplus or deficiency if obligation secured. If the
security interest under which a disposition is made secures
payment or performance of an obligation, after making the
payments and applications required by subsection (1) of this
section and permitted by subsection (3) of this section:
(a) Unless subsection (1)(d) of this section requires the
secured party to apply or pay over cash proceeds to a consignor,
the secured party shall account to and pay a debtor for any
surplus; and
(b) The obligor is liable for any deficiency.
(5) No surplus or deficiency in sales of certain rights to
payment. If the underlying transaction is a sale of accounts,
chattel paper, payment intangibles or promissory notes:
(a) The debtor is not entitled to any surplus; and
(b) The obligor is not liable for any deficiency.
(6) Calculation of surplus or deficiency in disposition to
person related to secured party. The surplus or deficiency
following a disposition is calculated based on the amount of
proceeds that would have been realized in a disposition complying
with sections 99 to 126 of this 2001 Act to a transferee other
than the secured party, a person related to the secured party, or
a secondary obligor if:
(a) The transferee in the disposition is the secured party, a
person related to the secured party, or a secondary obligor; and
(b) The amount of proceeds of the disposition is significantly
below the range of proceeds that a complying disposition to a
person other than the secured party, a person related to the
secured party, or a secondary obligor would have brought.
(7) Cash proceeds received by junior secured party. A secured
party that receives cash proceeds of a disposition in good faith
and without knowledge that the receipt violates the rights of the
holder of a security interest or other lien that is not
subordinate to the security interest or agricultural lien under
which the disposition is made:
(a) Takes the cash proceeds free of the security interest or
other lien;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 77
(b) Is not obligated to apply the proceeds of the disposition
to the satisfaction of obligations secured by the security
interest or other lien; and
(c) Is not obligated to account to or pay the holder of the
security interest or other lien for any surplus. + }
SECTION 114. { + 9-616. Explanation of calculation of surplus
or deficiency. (1) Definitions. As used in this section:
(a) 'Explanation' means a writing that:
(A) States the amount of the surplus or deficiency;
(B) Provides an explanation in accordance with subsection (3)
of this section of how the secured party calculated the surplus
or deficiency;
(C) States, if applicable, that future debits, credits,
charges, including additional credit service charges or interest,
rebates and expenses may affect the amount of the surplus or
deficiency; and
(D) Provides a telephone number or mailing address from which
additional information concerning the transaction is available.
(b) 'Request' means a record:
(A) Authenticated by a debtor or consumer obligor;
(B) Requesting that the recipient provide an explanation; and
(C) Sent after disposition of the collateral under section 108
of this 2001 Act.
(2) Explanation of calculation. In a consumer-goods transaction
in which the debtor is entitled to a surplus or a consumer
obligor is liable for a deficiency under section 113 of this 2001
Act, the secured party shall:
(a) Send an explanation to the debtor or consumer obligor, as
applicable, after the disposition and:
(A) Before or when the secured party accounts to the debtor and
pays any surplus or first makes written demand on the consumer
obligor after the disposition for payment of the deficiency; and
(B) Within 14 days after receipt of a request; or
(b) In the case of a consumer obligor who is liable for a
deficiency, within 14 days after receipt of a request, send to
the consumer obligor a record waiving the secured party's right
to a deficiency.
(3) Required information. To comply with subsection (1)(a)(B)
of this section, a writing must provide the following information
in the following order:
(a) The aggregate amount of obligations secured by the security
interest under which the disposition was made, and, if the amount
reflects a rebate of unearned interest or credit service charge,
an indication of that fact, calculated as of a specified date:
(A) If the secured party takes or receives possession of the
collateral after default, not more than 35 days before the
secured party takes or receives possession; or
(B) If the secured party takes or receives possession of the
collateral before default or does not take possession of the
collateral, not more than 35 days before the disposition;
(b) The amount of proceeds of the disposition;
(c) The aggregate amount of the obligations after deducting the
amount of proceeds;
(d) The amount, in the aggregate or by type, and types of
expenses, including expenses of retaking, holding, preparing for
disposition, processing and disposing of the collateral, and
attorney fees secured by the collateral which are known to the
secured party and relate to the current disposition;
(e) The amount, in the aggregate or by type, and types of
credits, including rebates of interest or credit service charges,
Enrolled Senate Bill 171 (SB 171-ACCA) Page 78
to which the obligor is known to be entitled and which are not
reflected in the amount in paragraph (a) of this subsection; and
(f) The amount of the surplus or deficiency.
(4) Substantial compliance. A particular phrasing of the
explanation is not required. An explanation complying
substantially with the requirements of subsection (1) of this
section is sufficient, even if it includes minor errors that are
not seriously misleading.
(5) Charges for responses. A debtor or consumer obligor is
entitled without charge to one response to a request under this
section during any six-month period in which the secured party
did not send to the debtor or consumer obligor an explanation
pursuant to subsection (2)(a) of this section. The secured party
may require payment of a charge not exceeding $25 for each
additional response. + }
SECTION 115. { + 9-617. Rights of transferee of collateral.
(1) Effects of disposition. A secured party's disposition of
collateral after default:
(a) Transfers to a transferee for value all of the debtor's
rights in the collateral;
(b) Discharges the security interest under which the
disposition is made; and
(c) Discharges any subordinate security interest or other
subordinate lien.
(2) Rights of good-faith transferee. A transferee that acts in
good faith takes free of the rights and interests described in
subsection (1) of this section, even if the secured party fails
to comply with this chapter or the requirements of any judicial
proceeding.
(3) Rights of other transferee. If a transferee does not take
free of the rights and interests described in subsection (1) of
this section, the transferee takes the collateral subject to:
(a) The debtor's rights in the collateral;
(b) The security interest or agricultural lien under which the
disposition is made; and
(c) Any other security interest or other lien. + }
SECTION 116. { + 9-618. Rights and duties of certain
secondary obligors. (1) Rights and duties of secondary obligor. A
secondary obligor acquires the rights and becomes obligated to
perform the duties of the secured party after the secondary
obligor:
(a) Receives an assignment of a secured obligation from the
secured party;
(b) Receives a transfer of collateral from the secured party
and agrees to accept the rights and assume the duties of the
secured party; or
(c) Is subrogated to the rights of a secured party with respect
to collateral.
(2) Effect of assignment, transfer or subrogation. An
assignment, transfer or subrogation described in subsection (1)
of this section:
(a) Is not a disposition of collateral under section 108 of
this 2001 Act; and
(b) Relieves the secured party of further duties under this
chapter. + }
SECTION 117. { + 9-619. Transfer of record or legal title.
(1) ' Transfer statement.' As used in this section, 'transfer
statement' means a record authenticated by a secured party
stating:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 79
(a) That the debtor has defaulted in connection with an
obligation secured by specified collateral;
(b) That the secured party has exercised its post-default
remedies with respect to the collateral;
(c) That, by reason of the exercise, a transferee has acquired
the rights of the debtor in the collateral; and
(d) The name and mailing address of the secured party, debtor
and transferee.
(2) Effect of transfer statement. A transfer statement entitles
the transferee to the transfer of record of all rights of the
debtor in the collateral specified in the statement in any
official filing, recording, registration or certificate-of-title
system covering the collateral. If a transfer statement is
presented with the applicable fee and request form to the
official or office responsible for maintaining the system, the
official or office shall:
(a) Accept the transfer statement;
(b) Promptly amend its records to reflect the transfer; and
(c) If applicable, issue a new appropriate certificate of title
in the name of the transferee.
(3) Transfer not a disposition; no relief of secured party's
duties. A transfer of the record or legal title to collateral to
a secured party under subsection (2) of this section or otherwise
is not of itself a disposition of collateral under this chapter
and does not of itself relieve the secured party of its duties
under this chapter. + }
SECTION 118. { + 9-620. Acceptance of collateral in full or
partial satisfaction of obligation; compulsory disposition of
collateral. (1) Conditions to acceptance in satisfaction. Except
as otherwise provided in subsection (7) of this section, a
secured party may accept collateral in full or partial
satisfaction of the obligation it secures only if:
(a) The debtor consents to the acceptance under subsection (3)
of this section;
(b) The secured party does not receive, within the time set
forth in subsection (4) of this section, a notification of
objection to the proposal authenticated by:
(A) A person to which the secured party was required to send a
proposal under section 119 of this 2001 Act; or
(B) Any other person, other than the debtor, holding an
interest in the collateral subordinate to the security interest
that is the subject of the proposal;
(c) If the collateral is consumer goods, the collateral is not
in the possession of the debtor when the debtor consents to the
acceptance; and
(d) Subsection (5) of this section does not require the secured
party to dispose of the collateral or the debtor waives the
requirement pursuant to section 122 of this 2001 Act.
(2) Purported acceptance ineffective. A purported or apparent
acceptance of collateral under this section is ineffective
unless:
(a) The secured party consents to the acceptance in an
authenticated record or sends a proposal to the debtor; and
(b) The conditions of subsection (1) of this section are met.
(3) Debtor's consent. For purposes of this section:
(a) A debtor consents to an acceptance of collateral in partial
satisfaction of the obligation it secures only if the debtor
agrees to the terms of the acceptance in a record authenticated
after default; and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 80
(b) A debtor consents to an acceptance of collateral in full
satisfaction of the obligation it secures only if the debtor
agrees to the terms of the acceptance in a record authenticated
after default or the secured party:
(A) Sends to the debtor after default a proposal that is
unconditional or subject only to a condition that collateral not
in the possession of the secured party be preserved or
maintained;
(B) In the proposal, proposes to accept collateral in full
satisfaction of the obligation it secures; and
(C) Does not receive a notification of objection authenticated
by the debtor within 20 days after the proposal is sent.
(4) Effectiveness of notification. To be effective under
subsection (1)(b) of this section, a notification of objection
must be received by the secured party:
(a) In the case of a person to which the proposal was sent
pursuant to section 119 of this 2001 Act, within 20 days after
notification was sent to that person; and
(b) In other cases:
(A) Within 20 days after the last notification was sent
pursuant to section 119 of this 2001 Act; or
(B) If a notification was not sent, before the debtor consents
to the acceptance under subsection (3) of this section.
(5) Mandatory disposition of consumer goods. A secured party
that has taken possession of collateral shall dispose of the
collateral pursuant to section 108 of this 2001 Act within the
time specified in subsection (6) of this section if:
(a) Sixty percent of the cash price has been paid in the case
of a purchase-money security interest in consumer goods; or
(b) Sixty percent of the principal amount of the obligation
secured has been paid in the case of a non-purchase-money
security interest in consumer goods.
(6) Compliance with mandatory disposition requirement. To
comply with subsection (5) of this section, the secured party
shall dispose of the collateral:
(a) Within 180 days after taking possession; or
(b) Within any longer period to which the debtor and all
secondary obligors have agreed in an agreement to that effect
entered into and authenticated after default.
(7) No partial satisfaction in consumer transaction. In a
consumer transaction, a secured party may not accept collateral
in partial satisfaction of the obligation it secures. + }
SECTION 119. { + 9-621. Notification of proposal to accept
collateral. (1) Persons to which proposal to be sent. A secured
party that desires to accept collateral in full or partial
satisfaction of the obligation it secures shall send its proposal
to:
(a) Any person from which the secured party has received,
before the debtor consented to the acceptance, an authenticated
notification of a claim of an interest in the collateral;
(b) Any other secured party or lienholder that, 10 days before
the debtor consented to the acceptance, held a security interest
in or other lien on the collateral perfected by the filing of a
financing statement that:
(A) Identified the collateral;
(B) Was indexed under the debtor's name as of that date; and
(C) Was filed in the office or offices in which to file a
financing statement against the debtor covering the collateral as
of that date; and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 81
(c) Any other secured party that, 10 days before the debtor
consented to the acceptance, held a security interest in the
collateral perfected by compliance with a statute, regulation or
treaty described in section 31 (1) of this 2001 Act.
(2) Proposal to be sent to secondary obligor in partial
satisfaction. A secured party that desires to accept collateral
in partial satisfaction of the obligation it secures shall send
its proposal to any secondary obligor in addition to the persons
described in subsection (1) of this section. + }
SECTION 120. { + 9-622. Effect of acceptance of collateral.
(1) Effect of acceptance. A secured party's acceptance of
collateral in full or partial satisfaction of the obligation it
secures:
(a) Discharges the obligation to the extent consented to by the
debtor;
(b) Transfers to the secured party all of a debtor's rights in
the collateral;
(c) Discharges the security interest or agricultural lien that
is the subject of the debtor's consent and any subordinate
security interest or other subordinate lien; and
(d) Terminates any other subordinate interest.
(2) Discharge of subordinate interest notwithstanding
noncompliance. A subordinate interest is discharged or terminated
under subsection (1) of this section, even if the secured party
fails to comply with this chapter. + }
SECTION 121. { + 9-623. Right to redeem collateral. (1)
Persons that may redeem. A debtor, any secondary obligor or any
other secured party or lienholder may redeem collateral.
(2) Requirements for redemption. To redeem collateral, a person
shall tender:
(a) Fulfillment of all obligations secured by the collateral;
and
(b) The reasonable expenses and attorney fees described in
section 113 (1)(a) of this 2001 Act.
(3) When redemption may occur. A redemption may occur at any
time before a secured party:
(a) Has collected collateral under section 105 of this 2001
Act;
(b) Has disposed of collateral or entered into a contract for
its disposition under section 108 of this 2001 Act; or
(c) Has accepted collateral in full or partial satisfaction of
the obligation it secures under section 120 of this 2001 Act. + }
SECTION 122. { + 9-624. Waiver. (1) Waiver of disposition
notification. A debtor or secondary obligor may waive the right
to notification of disposition of collateral under section 109 of
this 2001 Act only by an agreement to that effect entered into
and authenticated after default.
(2) Waiver of mandatory disposition. A debtor may waive the
right to require disposition of collateral under section 118 (5)
of this 2001 Act only by an agreement to that effect entered into
and authenticated after default.
(3) Waiver of redemption right. Except in a consumer-goods
transaction, a debtor or secondary obligor may waive the right to
redeem collateral under section 121 of this 2001 Act only by an
agreement to that effect entered into and authenticated after
default. + }
{ +
(Noncompliance With Chapter) + }
Enrolled Senate Bill 171 (SB 171-ACCA) Page 82
SECTION 123. { + 9-625. Remedies for secured party's failure
to comply with article. (1) Judicial orders concerning
noncompliance. If it is established that a secured party is not
proceeding in accordance with this chapter, a court may order or
restrain collection, enforcement or disposition of collateral on
appropriate terms and conditions.
(2) Damages for noncompliance. Subject to subsections (3), (4)
and (6) of this section, a person is liable for damages in the
amount of any loss caused by a failure to comply with this
chapter. Loss caused by a failure to comply may include loss
resulting from the debtor's inability to obtain, or increased
costs of, alternative financing.
(3) Persons entitled to recover damages; statutory damages in
consumer-goods transaction. Except as otherwise provided in
section 126 of this 2001 Act:
(a) A person that, at the time of the failure, was a debtor,
was an obligor, or held a security interest in or other lien on
the collateral may, in an individual action only, recover damages
under subsection (2) of this section for its loss;
(b) If the collateral is consumer goods, a person that was a
debtor or a secondary obligor at the time a secured party failed
to comply with sections 99 to 126 of this 2001 Act may, in an
individual action only, recover an amount not less than $1,000;
and
(c) The court may award reasonable attorney fees to the
prevailing party in an action under this subsection.
(4) Recovery when deficiency eliminated or reduced. A debtor
whose deficiency is eliminated under section 124 of this 2001 Act
may recover damages for the loss of any surplus. However, a
debtor or secondary obligor whose deficiency is eliminated or
reduced under section 124 of this 2001 Act may not otherwise
recover under subsection (2) of this section for noncompliance
with the provisions of sections 99 to 126 of this 2001 Act
relating to collection, enforcement, disposition or acceptance.
(5) Statutory damages: Noncompliance with specified provisions.
Regarding a transaction that is a consumer transaction or in
which the collateral is consumer goods, in addition to any
damages recoverable under subsection (2) of this section, the
debtor, consumer obligor, or person named as a debtor in a filed
record, as applicable, may, in an individual action only, recover
$500 for each instance from a person that:
(a) Fails to comply with section 18 of this 2001 Act;
(b) Fails to comply with section 19 of this 2001 Act;
(c) After the effective date of this 2001 Act, files a record
that the person is not entitled to file under section 80 (1) of
this 2001 Act if the record is not released or terminated within
10 days after receipt by the secured party of an authenticated
request from the debtor that explains the basis for the request;
(d) Fails to cause the secured party of record to file or send
a termination statement as required by section 84 (1) or (3) of
this 2001 Act; or
(e) Fails to comply with section 114 (2) of this 2001 Act and
whose failure is part of a pattern, or consistent with a
practice, of noncompliance.
(6) Statutory damages: Noncompliance with section 20 of this
2001 Act. A debtor or consumer obligor may recover damages under
subsection (2) of this section and, in addition, $500 in each
case from a person that, without reasonable cause, fails to
comply with a request under section 20 of this 2001 Act. A
recipient of a request under section 20 of this 2001 Act which
Enrolled Senate Bill 171 (SB 171-ACCA) Page 83
never claimed an interest in the collateral or obligations that
are the subject of a request under section 20 of this 2001 Act
has a reasonable excuse for failure to comply with the request
within the meaning of this subsection.
(7) Limitation of security interest: Noncompliance with section
20 of this 2001 Act. If a secured party fails to comply with a
request regarding a list of collateral or a statement of account
under section 20 of this 2001 Act, the secured party may claim a
security interest only as shown in the list or statement included
in the request as against a person that is reasonably misled by
the failure. + }
SECTION 124. { + 9-626. Action in which deficiency or surplus
is in issue. (1) Applicable rules if amount of deficiency or
surplus in issue. In an action arising from a transaction, other
than a consumer transaction, in which the amount of a deficiency
or surplus is in issue, the following rules apply:
(a) A secured party need not prove compliance with the
provisions of sections 99 to 126 of this 2001 Act relating to
collection, enforcement, disposition, or acceptance unless the
debtor or a secondary obligor places the secured party's
compliance in issue.
(b) If the secured party's compliance is placed in issue, the
secured party has the burden of establishing that the collection,
enforcement, disposition or acceptance was conducted in
accordance with sections 99 to 126 of this 2001 Act.
(c) Except as otherwise provided in section 126 of this 2001
Act, if a secured party fails to prove that the collection,
enforcement, disposition or acceptance was conducted in
accordance with the provisions of sections 99 to 126 of this 2001
Act relating to collection, enforcement, disposition or
acceptance, the liability of a debtor or a secondary obligor for
a deficiency is limited to an amount by which the sum of the
secured obligation, expenses and attorney fees exceeds the
greater of:
(A) The proceeds of the collection, enforcement, disposition or
acceptance; or
(B) The amount of proceeds that would have been realized had
the noncomplying secured party proceeded in accordance with the
provisions of sections 99 to 126 of this 2001 Act relating to
collection, enforcement, disposition or acceptance.
(d) For purposes of paragraph (c)(B) of this subsection, the
amount of proceeds that would have been realized is equal to the
sum of the secured obligation, expenses and attorney fees unless
the secured party proves that the amount is less than that sum.
(e) If a deficiency or surplus is calculated under section 113
(6) of this 2001 Act, the debtor or obligor has the burden of
establishing that the amount of proceeds of the disposition is
significantly below the range of prices that a complying
disposition to a person other than the secured party, a person
related to the secured party, or a secondary obligor would have
brought.
(2) Nonconsumer transactions; no inference. The limitation of
the rules in subsection (1) of this section to transactions other
than consumer transactions is intended to leave to the court the
determination of the proper rules in consumer transactions. The
court may not infer from that limitation the nature of the proper
rule in consumer transactions and may continue to apply
established approaches. + }
SECTION 125. { + 9-627. Determination of whether conduct was
commercially reasonable. (1) Greater amount obtainable under
Enrolled Senate Bill 171 (SB 171-ACCA) Page 84
other circumstances; no preclusion of commercial reasonableness.
The fact that a greater amount could have been obtained by a
collection, enforcement, disposition or acceptance at a different
time or in a different method from that selected by the secured
party is not of itself sufficient to preclude the secured party
from establishing that the collection, enforcement, disposition
or acceptance was made in a commercially reasonable manner.
(2) Dispositions that are commercially reasonable. A
disposition of collateral is made in a commercially reasonable
manner if the disposition is made:
(a) In the usual manner on any recognized market;
(b) At the price current in any recognized market at the time
of the disposition; or
(c) Otherwise in conformity with reasonable commercial
practices among dealers in the type of property that was the
subject of the disposition.
(3) Approval by court or on behalf of creditors. A collection,
enforcement, disposition or acceptance is commercially reasonable
if it has been approved:
(a) In a judicial proceeding;
(b) By a bona fide creditors' committee;
(c) By a representative of creditors; or
(d) By an assignee for the benefit of creditors.
(4) Approval under subsection (3) of this section not
necessary; absence of approval has no effect. Approval under
subsection (3) of this section need not be obtained, and lack of
approval does not mean that the collection, enforcement,
disposition or acceptance is not commercially reasonable. + }
SECTION 126. { + 9-628. Nonliability and limitation on
liability of secured party; liability of secondary obligor. (1)
Limitation of liability of secured party for noncompliance with
this chapter. Unless a secured party knows that a person is a
debtor or obligor, knows the identity of the person and knows how
to communicate with the person:
(a) The secured party is not liable to the person, or to a
secured party or lienholder that has filed a financing statement
against the person, for failure to comply with this chapter; and
(b) The secured party's failure to comply with this chapter
does not affect the liability of the person for a deficiency.
(2) Limitation of liability based on status as secured party.
A secured party is not liable because of its status as secured
party:
(a) To a person that is a debtor or obligor, unless the secured
party knows:
(A) That the person is a debtor or obligor;
(B) The identity of the person; and
(C) How to communicate with the person; or
(b) To a secured party or lienholder that has filed a financing
statement against a person, unless the secured party knows:
(A) That the person is a debtor; and
(B) The identity of the person.
(3) Limitation of liability if reasonable belief that
transaction not a consumer-goods transaction or consumer
transaction. A secured party is not liable to any person, and a
person's liability for a deficiency is not affected, because of
any act or omission arising out of the secured party's reasonable
belief that a transaction is not a consumer-goods transaction or
a consumer transaction or that goods are not consumer goods, if
the secured party's belief is based on its reasonable reliance
on:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 85
(a) A debtor's representation concerning the purpose for which
collateral was to be used, acquired or held; or
(b) An obligor's representation concerning the purpose for
which a secured obligation was incurred.
(4) Limitation of liability for statutory damages. A secured
party is not liable to any person under section 123 (3)(b) of
this 2001 Act for its failure to comply with section 114 of this
2001 Act.
(5) Limitation of multiple liability for statutory damages. A
secured party is not liable under section 123 (3)(b) of this 2001
Act more than once with respect to any one secured
obligation. + }
SECTION 127. { + Sections 1 to 126 of this 2001 Act are added
to and made a part of ORS chapter 79. + }
SECTION 128. { + Notwithstanding any other provision of law,
ORS 79.6020 to 79.7010 shall not be considered to have been added
to or made a part of ORS chapter 79 for the purpose of statutory
compilation or for the application of definitions, penalties or
administrative provisions applicable to statute sections in that
chapter. + }
{ +
CONFORMING AMENDMENTS + }
SECTION 129. ORS 71.1010 is amended to read:
71.1010. This chapter, ORS 72.1010 to 72.7250 and ORS chapters
72A, 73, 74, 74A, 75, 77 { + , + } { - and - } 78 and
{ - ORS 79.1010 to 79.5070 and 79.8010 - } { + 79 + } may be
cited as Uniform Commercial Code.
SECTION 130. ORS 71.1050 is amended to read:
71.1050. (1) Except as provided hereafter in this section, when
a transaction bears a reasonable relation to this state and also
to another state or nation the parties may agree that the law
either of this state or of such other state or nation shall
govern their rights and duties. Failing such agreement the
Uniform Commercial Code applies to transactions bearing an
appropriate relation to this state.
(2) Where one of the following provisions specifies the
applicable law, that provision governs and a contrary agreement
is effective only to the extent permitted by the law (including
the conflict of laws rules) so specified:
(a) Rights of creditors against sold goods as specified in ORS
72.4020.
(b) Applicability of ORS chapter 72A on leases.
(c) Applicability of ORS chapter 74 as specified in ORS
74.1020.
(d) Applicability of ORS chapter 74A as specified in ORS
74A.5070.
(e) Applicability of ORS chapter 75 as specified in ORS
75.1160.
(f) Applicability of ORS chapter 78 as specified in ORS
78.1100.
(g) { - Perfection provisions of ORS 79.1030. - }
{ + Sections 21 to 27 of this 2001 Act governing perfection, the
effect of perfection or nonperfection, and the priority of
security interests and agricultural liens. + }
SECTION 131. ORS 71.2010 is amended to read:
71.2010. Subject to additional definitions contained in other
sections of the Uniform Commercial Code which are applicable to a
Enrolled Senate Bill 171 (SB 171-ACCA) Page 86
specific series of sections, and unless the context otherwise
requires, in the Uniform Commercial Code:
(1) 'Action' in the sense of a judicial proceeding includes
recoupment, counterclaim, setoff, suit in equity and any other
proceedings in which rights are determined.
(2) 'Aggrieved party' means a party entitled to resort to a
remedy.
(3) 'Agreement' means the bargain of the parties in fact as
found in their language or by implication from other
circumstances including course of dealing or usage of trade or
course of performance as provided in ORS 71.2050 and 72.2080.
Whether an agreement has legal consequences is determined by the
provisions of the Uniform Commercial Code, if applicable;
otherwise by the law of contracts as specified in ORS 71.1030.
(4) 'Bank' means any person engaged in the business of banking.
(5) 'Bearer' means the person in possession of an instrument,
document of title or security payable to bearer or indorsed in
blank.
(6) '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, and includes an airbill.
'Airbill' means a document serving for air transportation as a
bill of lading does for marine or rail transportation, and
includes an air consignment note or air waybill.
(7) 'Branch' includes a separately incorporated foreign branch
of a bank.
(8) 'Burden of establishing' a fact means the burden of
persuading the triers of fact that the existence of the fact is
more probable than its nonexistence.
(9) 'Buyer in ordinary course of business' means a person
{ - who - } { + that buys goods + } in good faith { + , + }
{ - and - } without knowledge that the sale { - to the person
is in violation of - } { + violates + } the
{ - ownership - } rights { - or security interest - } of
{ - a third party - } { + another person + } in the
goods { + , and + } { - buys - } in { + the + } ordinary
course from a { - seller - } { + person, other than a
pawnbroker, + } in the business of selling goods of that
kind { + . + } { - but does not include a pawnbroker. All
persons who sell minerals or the like (including oil and gas) at
wellhead or minehead shall be deemed to be sellers - } { + 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. { - ' Buying' - }
{ + A buyer in ordinary course of business + } may { - be - }
{ + buy + } for cash { + , + } { - or - } by exchange of
other property { + , + } or on secured or unsecured
credit { + , + } and
{ - includes receiving - } { + may acquire + } goods or
documents of title under a preexisting contract for sale
{ - but does not include a transfer in bulk or as security for
or in total or partial satisfaction of a money debt - } . { +
Only a buyer that takes possession of the goods or has a right to
recover the goods from the seller under ORS 72.1010 to 72.7250
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
Enrolled Senate Bill 171 (SB 171-ACCA) Page 87
total or partial satisfaction of a money debt is not a buyer in
ordinary course of business. + }
(10) 'Conspicuous': A term or clause is conspicuous when it is
so written that a reasonable person against whom it is to operate
ought to have noticed it. A printed heading in capitals (as:
NONNEGOTIABLE BILL OF LADING) is conspicuous. Language in the
body of a form is 'conspicuous' if it is in larger or other
contrasting type or color. But in a telegram any stated term is '
conspicuous.' Whether a term or clause is 'conspicuous' or not is
for decision by the court.
(11) 'Contract' means the total legal obligation which results
from the parties' agreement as affected by the Uniform Commercial
Code and any other applicable rules of law.
(12) '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.
(13) 'Defendant' includes a person in the position of defendant
in a cross action or counterclaim.
(14) 'Delivery' with respect to instruments, documents of
title, chattel paper or certificated securities means voluntary
transfer of possession.
(15) 'Document of title' includes bill of lading, dock warrant,
dock receipt, warehouse receipt or order for the delivery of
goods, and also 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.
(16) 'Fault' means wrongful act, omission or breach.
(17) 'Fungible' with respect to goods or securities means goods
or securities of which any unit is, by nature or usage of trade,
the equivalent of any other like unit. Goods which are not
fungible shall be deemed fungible for the purposes of the Uniform
Commercial Code to the extent that under a particular agreement
or document unlike units are treated as equivalents.
(18) 'Genuine' means free of forgery or counterfeiting.
(19) 'Good faith' means honesty in fact in the conduct or
transaction concerned.
(20) 'Holder' means:
(a) With respect to a negotiable instrument, the person in
possession of the negotiable instrument if:
(A) The instrument is payable to bearer; or
(B) The instrument is payable to an identified person, and the
identified person is in possession.
(b) With respect to a document of title, the person in
possession of the document of title if the goods are deliverable
to bearer or to the order of the person in possession.
(21) To 'honor' is to pay or to accept and pay, or where a
credit so engages to purchase or discount a draft complying with
the terms of the credit.
(22) 'Insolvency proceedings' includes any assignment for the
benefit of creditors or other proceedings intended to liquidate
or rehabilitate the estate of the person involved.
(23) A person is 'insolvent' who either has ceased to pay the
person's debts in the ordinary course of business or cannot pay
Enrolled Senate Bill 171 (SB 171-ACCA) Page 88
the person's debts as they become due or is insolvent within the
meaning of the federal bankruptcy law.
(24) 'Money' means a medium of exchange authorized or adopted
by a domestic or foreign government and includes a monetary unit
of account established by an intergovernmental organization or by
agreement between two or more nations.
(25) A person has 'notice' of fact when:
(a) The person has actual knowledge of it;
(b) The person has received a notice or notification of it; or
(c) From all the facts and circumstances known to the person at
the time in question the person has reason to know that it
exists.
A person 'knows' or has 'knowledge' of a fact when the person has
actual knowledge of it. 'Discover' or 'learn' or a word or phrase
of similar import refers to knowledge rather than to reason to
know. The time and circumstances under which a notice or
notification may cease to be effective are not determined by the
Uniform Commercial Code.
(26) A person 'notifies' or 'gives' a notice or notification to
another by taking such steps as may be reasonably required to
inform the other in ordinary course whether or not such other
actually comes to know of it. A person 'receives' a notice or
notification when:
(a) It comes to the person's attention; or
(b) It is duly delivered at the place of business through which
the contract was made or at any other place held out by the
person as the place for receipt of such communications.
(27) Notice, knowledge or a notice or notification received by
an organization is effective for a particular transaction from
the time when it is brought to the attention of the individual
conducting that transaction, and in any event from the time when
it would have been brought to the individual's attention if the
organization had exercised due diligence.
(28) 'Organization' includes a corporation, government or
governmental subdivision or agency, business trust, estate,
trust, partnership or association, two or more persons having a
joint or common interest, or any other legal or commercial
entity.
(29) 'Party,' as distinct from 'third party,' means a person
who has engaged in a transaction or made an agreement within the
Uniform Commercial Code.
(30) 'Person' includes an individual or an organization.
(31) '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.
(32) 'Purchase' includes taking by sale, discount, negotiation,
mortgage, pledge, lien, { + security interest, + } issue or
reissue, gift or any other voluntary transaction creating an
interest in property.
(33) 'Purchaser' means a person who takes by purchase.
(34) 'Remedy' means any remedial right to which an aggrieved
party is entitled with or without resort to a tribunal.
(35) 'Representative' includes an agent, an officer of a
corporation or association, and a trustee, executor or
administrator of an estate, or any other person empowered to act
for another.
(36) 'Rights' includes remedies.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 89
(37)(a) 'Security interest' means an interest in personal
property or fixtures which secures payment or performance of an
obligation. { - The retention or reservation of title by a
seller of goods notwithstanding shipment or delivery to the buyer
is limited in effect to a reservation of a 'security
interest.' - } The term also includes any interest of a
{ + consignor and a + } buyer of accounts { + , + } { - or - }
chattel paper { + , + } { - which - } { + a payment
intangible or a promissory note in a transaction that + } is
subject to ORS { - 79.1010 to 79.5070 and 79.8010 - } { +
chapter 79 + }. The special property interest of a buyer of goods
on identification of such goods to a contract for sale under ORS
72.4010 is not a 'security interest,' but a buyer may also
acquire a 'security interest' by complying with ORS { - 79.1010
to 79.5070 and 79.8010 - } { + chapter 79 + }. { - Unless a
lease or consignment is intended as security, reservation of
title thereunder is not a 'security interest' but a consignment
is in any event subject to the provisions on consignment
sales. - } { + Except as otherwise provided in ORS 72.5050, the
right of a seller or lessor of goods under ORS 72.1010 to 72.7250
or ORS chapter 72A 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 ORS chapter 79.
The retention or reservation of title by a seller of goods
notwithstanding shipment or delivery to the buyer (ORS 72.4010)
is limited in effect to a reservation of a 'security
interest.' + } Whether a transaction creates a lease or security
interest is determined by the facts of each case; however, a
transaction creates a security interest if the consideration the
lessee is to pay the lessor for the right to possession and use
of the goods is an obligation for the term of the lease not
subject to termination by the lessee and:
(A) The original term of the lease is equal to or greater than
the remaining economic life of the goods;
(B) The lessee is bound to renew the lease for the remaining
economic life of the goods or is bound to become the owner of the
goods;
(C) The lessee has an option to renew the lease for the
remaining economic life of the goods for no additional
consideration or nominal additional consideration upon compliance
with the lease agreement; or
(D) The lessee has an option to become the owner of the goods
for no additional consideration or nominal additional
consideration upon compliance with the lease agreement.
(b) A transaction does not create a security interest merely
because it provides that:
(A) The present value of the consideration the lessee is
obligated to pay the lessor for the right to possession and use
of the goods is substantially equal to or is greater than the
fair market value of the goods at the time the lease is entered
into;
(B) The lessee assumes risk of loss of the goods, or agrees to
pay taxes, insurance, filing, recording or registration fees, or
service or maintenance costs with respect to the goods;
(C) The lessee has an option to renew the lease or to become
the owner of the goods;
(D) The lessee has an option to renew the lease for a fixed
rent that is equal to or greater than the reasonably predictable
fair market rent for the use of the goods for the term of the
renewal at the time the option is to be performed; or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 90
(E) The lessee has an option to become the owner of the goods
for a fixed price that is equal to or greater than the reasonably
predictable fair market value of the goods at the time the option
is to be performed.
(c) For purposes of this subsection:
(A) 'Additional consideration' is not nominal if, when the
option to renew the lease is granted to the lessee, the rent is
stated to be the fair market rent for the use of the goods for
the term of the renewal determined at the time the option is to
be performed, or when the option to become the owner of the goods
is granted to the lessee the price is stated to be the fair
market value of the goods determined at the time the option is to
be performed. 'Additional consideration' is nominal if it is less
than the lessee's reasonably predictable cost of performing under
the lease agreement if the option is not exercised;
(B) 'Present value' means the amount as of a date certain of
one or more sums payable in the future, discounted to the date
certain. The discount is determined by the interest rate
specified by the parties if the rate is not manifestly
unreasonable at the time the transaction is entered into,
otherwise, the discount is determined by a commercially
reasonable rate that takes into account the facts and
circumstances of each case at the time the transaction was
entered into; and
(C) 'Reasonably predictable' and 'remaining economic life of
the goods' are to be determined with reference to the facts and
circumstances at the time the transaction is entered into.
(38) 'Send' in connection with any writing or notice means 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. The receipt of any writing or notice within the
time at which it would have arrived if properly sent has the
effect of a proper sending.
(39) 'Signed' includes any symbol executed or adopted by a
party with present intention to authenticate a writing.
(40) 'Surety' includes guarantor.
(41) 'Telegram' includes a message transmitted by radio,
teletype, cable, any mechanical method of transmission, or the
like.
(42) 'Term' means that portion of an agreement which relates to
a particular matter.
(43) 'Unauthorized' signature or indorsement means one made
without actual, implied or apparent authority and includes a
forgery.
(44) 'Value.' Except as otherwise provided with respect to
negotiable instruments and bank collections in ORS 74.2090 and
74.2100, a person gives 'value' for rights if the person acquires
them:
(a) In return for a binding commitment to extend credit or for
the extension of immediately available credit whether or not
drawn upon and whether or not a chargeback is provided for in the
event of difficulties in collection;
(b) As security for or in total or partial satisfaction of a
preexisting claim;
(c) By accepting delivery pursuant to a preexisting contract
for purchase; or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 91
(d) Generally, in return for any consideration sufficient to
support a simple contract.
(45) 'Warehouse receipt' means a receipt issued by a person
engaged in the business of storing goods for hire.
(46) 'Written' or 'writing' includes printing, typewriting or
any other intentional reduction to tangible form.
SECTION 132. ORS 72.1030 is amended to read:
72.1030. (1) In ORS 72.1010 to 72.7250 unless the context
otherwise requires:
(a) 'Buyer' means a person who buys or contracts to buy goods.
(b) 'Good faith' in the case of a merchant means honesty in
fact and the observance of reasonable commercial standards of
fair dealing in the trade.
(c) 'Livestock' means equines, cattle, sheep, goats, llamas,
alpacas and swine.
(d) 'Receipt' of goods means taking physical possession of
them.
(e) 'Seller' means a person who sells or contracts to sell
goods.
(2) Other definitions applying to ORS 72.1010 to 72.7250, and
the sections in which they appear are:
(a) 'Acceptance,' as defined in ORS 72.6060.
(b) 'Banker's credit,' as defined in ORS 72.3250.
(c) 'Between merchants,' as defined in ORS 72.1040.
(d) 'Cancellation,' as defined in ORS 72.1060 (4).
(e) 'Commercial unit,' as defined in ORS 72.1050.
(f) 'Confirmed credit,' as defined in ORS 72.3250.
(g) 'Conforming to contract,' as defined in ORS 72.1060.
(h) 'Contract for sale,' as defined in ORS 72.1060.
(i) 'Cover,' as defined in ORS 72.7120.
(j) 'Entrusting,' as defined in ORS 72.4030.
(k) 'Financing agency,' as defined in ORS 72.1040.
(L) 'Future goods,' as defined in ORS 72.1050.
(m) 'Goods,' as defined in ORS 72.1050.
(n) 'Identification,' as defined in ORS 72.5010.
(o) 'Installment contract,' as defined in ORS 72.6120.
(p) 'Letter of credit,' as defined in ORS 72.3250.
(q) 'Lot,' as defined in ORS 72.1050.
(r) 'Merchant,' as defined in ORS 72.1040.
(s) 'Overseas,' as defined in ORS 72.3230.
(t) 'Person in position of seller,' as defined in ORS 72.7070.
(u) 'Present sale,' as defined in ORS 72.1060.
(v) 'Sale,' as defined in ORS 72.1060.
(w) 'Sale on approval,' as defined in ORS 72.3260.
(x) 'Sale or return,' as defined in ORS 72.3260.
(y) 'Termination,' as defined in ORS 72.1060.
(3) The following definitions in other series of sections apply
to ORS 72.1010 to 72.7250:
(a) 'Check,' as defined in ORS 73.0104.
(b) 'Consignee,' as defined in ORS 77.1020.
(c) 'Consignor,' as defined in ORS 77.1020.
(d) 'Consumer goods,' as defined in { - ORS 79.1090 - } { +
section 2 of this 2001 Act + }.
(e) 'Dishonor,' as defined in ORS 73.0502.
(f) 'Draft,' as defined in ORS 73.0104.
(4) In addition, ORS chapter 71 contains general definitions
and principles of construction and interpretation applicable
throughout ORS 72.1010 to 72.7250.
SECTION 133. ORS 72.2100 is amended to read:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 92
72.2100. (1) A party may perform the duty of the party through
a delegate unless otherwise agreed or unless the other party has
a substantial interest in having the original promisor perform or
control the acts required by the contract. No delegation of
performance relieves the party delegating of any duty to perform
or any liability for breach.
(2) { - Unless - } { + Except as otherwise provided in
section 68 of this 2001 Act, unless + }otherwise
agreed { + , + } all rights of either seller or buyer can be
assigned except where the assignment would materially change the
duty of the other party, or increase materially the burden or
risk imposed on the other party by the contract, or impair
materially the chance of the other party obtaining return
performance. A right to damages for breach of the whole contract
or a right arising out of the assignor's due performance of the
entire obligation of the assignor can be assigned despite
agreement otherwise.
{ + (3) The creation, attachment, perfection or enforcement
of a security interest in the seller's interest under a contract
is not a transfer that materially changes the duty of or
increases materially the burden or risk imposed on the buyer or
impairs materially the buyer's chance of obtaining return
performance within the purview of subsection (2) unless, and then
only to the extent that, enforcement actually results in a
delegation of material performance of the seller. Even in that
event, the creation, attachment, perfection and enforcement of
the security interest remain effective, but (i) the seller is
liable to the buyer for damages caused by the delegation to the
extent that the damages could not reasonably be prevented by the
buyer, and (ii) a court having jurisdiction may grant other
appropriate relief, including cancellation of the contract for
sale or an injunction against enforcement of the security
interest or consummation of the enforcement. + }
{ - (3) - } { + (4) + } Unless the circumstances indicate
the contrary a prohibition of assignment of 'the contract' is to
be construed as barring only the delegation to the assignee of
the assignor's performance.
{ - (4) - } { + (5) + } An assignment of 'the contract' or
of 'all my rights under the contract' or an assignment in similar
general terms is an assignment of rights and unless the language
or the circumstances (as in an assignment for security) indicate
the contrary, it is a delegation of performance of the duties of
the assignor and its acceptance by the assignee constitutes a
promise by the assignee to perform those duties. This promise is
enforceable by either the assignor or the other party to the
original contract.
{ - (5) - } { + (6) + } The other party may treat any
assignment which delegates performance as creating reasonable
grounds for insecurity and may without prejudice to the rights of
the other party against the assignor demand assurances from the
assignee as provided in ORS 72.6090.
SECTION 134. ORS 72.3260 is amended to read:
72.3260. (1) Unless otherwise agreed, if delivered goods may be
returned by the buyer even though they conform to the contract,
the transaction is:
(a) A 'sale on approval' if the goods are delivered primarily
for use; and
(b) A 'sale or return' if the goods are delivered primarily for
resale.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 93
(2) { - Except as provided in subsection (3) of this
section, - } Goods held on approval are not subject to the claims
of the buyer's creditors until acceptance; goods held on sale or
return are subject to such claims while in the buyer's
possession.
{ - (3) Where goods are delivered to a person for sale and
such person maintains a place of business at which the person
deals in goods of the kind involved, under a name other than the
name of the person making delivery, then with respect to claims
of creditors of the person conducting the business the goods are
deemed to be on sale or return. The provisions of this subsection
are applicable even though an agreement purports to reserve title
to the person making delivery until payment or resale or uses
such words as 'on consignment' or 'on memorandum.' However, this
subsection is not applicable if the person making delivery: - }
{ - (a) Complies with an applicable law providing for a
consignor's interest or the like to be evidenced by a sign;
or - }
{ - (b) Establishes that the person conducting the business
is generally known by the creditors of the person to be
substantially engaged in selling the goods of others; or - }
{ - (c) Complies with the filing provisions of ORS 79.1010 to
79.5070 and 79.8010 on secured transactions. - }
{ - (4) - } { + (3) + } Any 'or return' term of a contract
for sale is to be treated as a separate contract for sale within
ORS 72.2010 relating to the statute of frauds and as
contradicting the sale aspect of the contract within the
provisions of ORS 72.2020 on parole or extrinsic evidence.
{ - (5) This section shall determine priorities in goods
between consignors and unsecured creditors of the person to whom
the goods are delivered for sale. This section does not apply to
the determination of priorities in goods between consignors and
secured creditors of the person to whom the goods are delivered
for sale. Priorities in goods between consignors and secured
creditors of the person to whom the goods are delivered for sale
shall be determined exclusively under ORS 79.3015. - }
SECTION 135. ORS 72.4010 is amended to read:
72.4010. Each provision of ORS 72.1010 to 72.7250 with regard
to the rights, obligations and remedies of the seller, the buyer,
purchasers or other third parties applies irrespective of title
to the goods except where the provision refers to such title. In
so far as situations are not covered by the other provisions of
ORS 72.1010 to 72.7250 and matters concerning title become
material the following rules apply:
(1) Title to goods cannot pass under a contract for sale prior
to their identification to the contract as provided in ORS
72.5010, and unless otherwise explicitly agreed the buyer
acquires by their identification a special property as limited by
the Uniform Commercial Code. Any retention or reservation by the
seller of the title (property) in goods shipped or delivered to
the buyer is limited in effect to a reservation of a security
interest. Subject to these provisions and to the provisions of
ORS
{ - 79.1010 to 79.5070 and 79.8010 - } { + chapter 79 + } on
secured transactions, title to goods passes from the seller to
the buyer in any manner and on any conditions explicitly agreed
on by the parties.
(2) Unless otherwise explicitly agreed title passes to the
buyer at the time and place at which the seller completes
performance with reference to the physical delivery of the goods,
Enrolled Senate Bill 171 (SB 171-ACCA) Page 94
despite any reservation of a security interest and even though a
document of title is to be delivered at a different time or
place; and in particular and despite any reservation of a
security interest by the bill of lading:
(a) If the contract requires or authorizes the seller to send
the goods to the buyer but does not require the seller to deliver
them at destination, title passes to the buyer at the time and
place of shipment; but
(b) If the contract requires delivery at destination, title
passes on tender there.
(3) Unless otherwise explicitly agreed where delivery is to be
made without moving the goods:
(a) If the seller is to deliver a document of title, title
passes at the time when and the place where the seller delivers
such documents; or
(b) If the goods are at the time of contracting already
identified and no documents are to be delivered, title passes at
the time and place of contracting.
(4) When livestock has been delivered under a contract of sale
and is transported by private, common or contract carrier, if on
the accompanying brand inspection certificate or memorandum of
brand inspection certificate the seller has noted that as
consideration for the sale of the livestock a draft, check,
certificate of deposit or note has been given, title does not
pass until the instrument is paid.
(5) A rejection or other refusal by the buyer to receive or
retain the goods, whether or not justified, or a justified
revocation of acceptance revests title to the goods in the
seller. Such revesting occurs by operation of law and is not a
'sale. '
SECTION 136. ORS 72.4020 is amended to read:
72.4020. (1) Except as provided in subsections (2) and (3) of
this section, rights of unsecured creditors of the seller with
respect to goods which have been identified to a contract for
sale are subject to the buyer's rights to recover the goods
pursuant to ORS 72.5020 and 72.7160.
(2) A creditor of the seller may treat a sale or an
identification of goods to a contract for sale as void if as
against the creditor a retention of possession by the seller is
fraudulent under any rule of law of the state where the goods are
situated, except that retention of possession in good faith and
current course of trade by a merchant-seller for a commercially
reasonable time after a sale or identification is not fraudulent.
(3) Nothing in ORS 72.1010 to 72.7250 shall be deemed to impair
the rights of creditors of the seller:
(a) Under the provisions of ORS { - 79.1010 to 79.5070 and
79.8010 - } { + chapter 79 + } on secured transactions; or
(b) Where identification to the contract or delivery is made
not in current course of trade but in satisfaction of or as
security for a preexisting claim for money, security or the like
and is made under circumstances which under any rule of law of
the state where the goods are situated would apart from ORS
72.1010 to 72.7250 constitute the transaction a fraudulent
transfer or voidable preference.
SECTION 137. ORS 72.4030 is amended to read:
72.4030. (1) A purchaser of goods acquires all title which the
transferor had or had power to transfer except that a purchaser
of a limited interest acquires rights only to the extent of the
interest purchased. A person with voidable title has power to
transfer a good title to a good faith purchaser for value. When
Enrolled Senate Bill 171 (SB 171-ACCA) Page 95
goods have been delivered under a transaction of purchase the
purchaser has such power even though:
(a) The transferor was deceived as to the identity of the
purchaser; or
(b) The delivery was in exchange for a check which is later
dishonored; or
(c) It was agreed that the transaction was to be a 'cash sale';
or
(d) The delivery was procured through fraud punishable as
larcenous under the criminal law.
(2) Notwithstanding any other provision of this section, when
livestock has been delivered under a transaction of purchase, is
transported by private, common or contract carrier and on the
accompanying brand inspection certificate or memorandum of brand
inspection certificate the seller has noted that as consideration
for the transaction of purchase a draft, check, certificate of
deposit or note was given, if the draft, check, certificate of
deposit or note is later dishonored, the buyer does not have
power to transfer good title to a good faith purchaser for value.
(3) Any entrusting of possession of goods to a merchant who
deals in goods of that kind gives the merchant power to transfer
all rights of the entruster to a buyer in ordinary course of
business.
(4) 'Entrusting' includes any delivery and any acquiescence in
retention of possession regardless of any condition expressed
between the parties to the delivery or acquiescence and
regardless of whether the procurement of the entrusting of the
possessor's disposition of the goods have been such as to be
larcenous under the criminal law.
(5) The rights of other purchasers of goods and of lien
creditors are governed by ORS { - 79.1010 to 79.5070 and
79.8010 - } { + chapter 79 + } on secured transactions and ORS
chapter 77 on documents of title.
SECTION 138. ORS 72.5020 is amended to read:
72.5020. (1) Subject to { - subsection - } { +
subsections + } (2) { + and (3) + } of this section and even
though the goods have not been shipped { + , + } a buyer who has
paid a part or all of the price of goods in which the buyer has a
special property under the provisions of { - the immediately
preceding section - } { + ORS 72.5010 + } may on making and
keeping good a tender of any unpaid portion of their price
recover them from the seller if { + :
(a) In the case of goods bought for personal, family or
household purposes, the seller repudiates or fails to deliver as
required by the contract; or
(b) In all cases, + } the seller becomes insolvent within 10
days after receipt of the first installment on their price.
{ + (2) The buyer's right to recover the goods under
subsection (1)(a) of this section vests upon acquisition of a
special property, even if the seller had not then repudiated or
failed to deliver. + }
{ - (2) - } { + (3) + } If the identification creating the
special property of the buyer has been made by the buyer the
buyer acquires the right to recover the goods only if they
conform to the contract for sale.
SECTION 139. ORS 72.7160 is amended to read:
72.7160. (1) Specific performance may be decreed where the
goods are unique or in other proper circumstances.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 96
(2) The decree for specific performance may include such terms
and conditions as to payment of the price, damages or other
relief as the court may deem just.
(3) The buyer has a right of replevin for goods identified to
the contract if after reasonable effort the buyer is unable to
effect cover for such goods or the circumstances reasonably
indicate that such effort will be unavailing or if the goods have
been shipped under reservation and satisfaction of the security
interest in them has been made or tendered. { + In the case of
goods bought for personal, family or household purposes, the
buyer's right of replevin vests upon acquisition of a special
property, even if the seller had not then repudiated or failed to
deliver. + }
SECTION 140. ORS 72.8010 is amended to read:
72.8010. As used in ORS 72.8010 to 72.8200, unless the context
requires otherwise:
(1) 'Consumer good' means a new consumer good as defined in
{ - ORS 79.1090 (1) - } { + section 2 of this 2001 Act + }
and includes, but is not limited to, a new motor vehicle, new
manufactured dwelling, new modular home, new machine, new
appliance or new like product used or bought for use primarily
for personal family or household purposes. However, 'consumer
good' does not include a soft good or a consumable.
(2) 'Buyer' or 'retail buyer' means any person who buys a
consumer good from a person engaged in the business of
manufacturing, distributing or selling consumer goods at retail.
(3) 'Manufacturer' means any person who manufactures, assembles
or produces consumer goods.
(4) 'Distributor' means any person who stands between the
manufacturer and the retail seller in purchases, consignments or
contracts for sale of consumer goods.
(5) 'Retail seller,' 'seller' or 'retailer' means a person who
engages in the business of selling consumer goods to retail
buyers.
(6) 'Soft good' means any pliable product substantially
composed of woven material, natural or synthetic yarn or fiber,
textile or similar product.
(7) 'Consumable' means any product which is intended for
consumption by individuals, or use by individuals for purposes of
personal care or in the performance of services ordinarily
rendered within the household, and which usually is consumed or
expended in the course of such consumption or use.
(8) 'Implied warranty of merchantability' of a consumer good or
'implied warranty that a consumer good is merchantable ' is a
warranty that the consumer good:
(a) Passes without objection in the trade under the contract
description;
(b) Is fit for the ordinary purposes for which the good is
used;
(c) Is adequately contained, packaged and labeled; and
(d) Conforms to the promises or affirmations of fact made on
the container or label.
(9) 'Implied warranty of fitness' means that when the retailer,
distributor or manufacturer has reason to know any particular
purpose for which the consumer good is required, and further,
that the buyer is relying on the skill and judgment of the seller
to select and furnish a suitable good, then there is an implied
warranty that the good shall be fit for such purpose.
SECTION 141. ORS 72A.1030 is amended to read:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 97
72A.1030. (1) As used in this chapter, unless the context
otherwise requires:
(a) 'Buyer in ordinary course of business' means a person who
in good faith and without knowledge that the sale to the person
is in violation of the ownership rights or security interest or
leasehold interest of a third party in the goods buys in ordinary
course from a person in the business of selling goods of that
kind but does not include a pawnbroker. 'Buying' may be for cash
or by exchange of other property or on secured or unsecured
credit and includes receiving goods or documents of title under a
preexisting contract for sale but does not include a transfer in
bulk or as security for or in total or partial satisfaction of a
money debt.
(b) 'Cancellation' occurs when either party puts an end to the
lease contract for default by the other party.
(c) 'Commercial unit' means such a unit of goods as by
commercial usage is a single whole for purposes of lease and
division of which materially impairs its character or value on
the market or in use. A 'commercial unit' may be a single
article, as a machine, or a set of articles, as a suite of
furniture or a line of machinery, or a quantity, as a gross or
carload, or any other unit treated in use or in the relevant
market as a single whole.
(d) 'Conforming goods' or 'performance under a lease contract'
means goods or performance that are in accordance with the
obligations under the lease contract.
(e) 'Consumer lease' means a lease that a lessor regularly
engaged in the business of leasing or selling makes to a lessee
who is an individual and who takes under the lease primarily for
a personal, family or household purpose, if the total payments to
be made under the lease contract, excluding payments for options
to renew or buy, do not exceed $25,000.
(f) 'Fault' means wrongful act, omission, breach or default.
(g) 'Finance lease' means a lease in which the lessor does not
select, manufacture or supply the goods, the lessor acquires the
goods or the right to possession and use of the goods in
connection with the lease, and either:
(A) The lessee receives a copy of the contract evidencing the
lessor's purchase of the goods on or before signing the lease
contract;
(B) The lessee's approval of the contract evidencing the
lessor's purchase of the goods is a condition to effectiveness of
the lease contract;
(C) The lessor informs the lessee in writing of the identity of
the supplier unless the lessee has selected the supplier and
directed the lessor to purchase the goods from the supplier;
(D) The lessor informs the lessee in writing that the lessee
may have rights under the contract evidencing the lessor's
purchase of the goods and the lessor advises the lessee in
writing to contact the supplier for a description of any such
rights; or
(E) The lease contract discloses all warranties and other
rights provided to the lessee by the lessor and supplier in
connection with the lease contract and informs the lessee that
there are no warranties or other rights provided to the lessee by
the lessor and supplier other than those disclosed in the lease
contract.
(h) 'Goods' means all things that are movable at the time of
identification to the lease contract, or are fixtures as provided
in ORS 72A.3090, but 'goods' does not include money, documents,
Enrolled Senate Bill 171 (SB 171-ACCA) Page 98
instruments, accounts, chattel paper, general intangibles or
minerals or the like, including oil and gas, before extraction.
'Goods' also includes the unborn young of animals.
(i) 'Installment lease contract' means a lease contract that
authorizes or requires the delivery of goods in separate lots to
be separately accepted, even though the lease contract contains a
clause 'each delivery is a separate lease' or its equivalent.
(j) 'Lease' means a transfer of the right to possession and use
of goods for a term in return for consideration, but a sale,
including a sale on approval or a sale or return, or retention or
creation of a security interest is not a lease. Unless the
context clearly indicates otherwise, 'lease' includes a sublease.
(k) 'Lease agreement' means the bargain, with respect to the
lease, of the lessor and the lessee in fact as found in the
language or by implication from other circumstances including
course of dealing or usage of trade or course of performance as
provided in this chapter. Unless the context clearly indicates
otherwise, 'lease agreement' includes a sublease agreement.
(L) 'Lease contract' means the total legal obligation that
results from the lease agreement as affected by this chapter and
any other applicable rules of law. Unless the context clearly
indicates otherwise, 'lease contract' includes a sublease
contract.
(m) 'Leasehold interest' means the interest of the lessor or
the lessee under a lease contract.
(n) 'Lessee' means a person who acquires the right to
possession and use of goods under a lease. Unless the context
clearly indicates otherwise, 'lessee' includes a sublessee.
(o) 'Lessee in ordinary course of business' means a person who
in good faith and without knowledge that the lease to the person
is in violation of the ownership rights or security interest or
leasehold interest of a third party in the goods leases in
ordinary course from a person in the business of selling or
leasing goods of that kind but does not include a pawnbroker. '
Leasing' may be for cash or by exchange of other property or on
secured or unsecured credit and includes receiving goods or
documents of title under a preexisting lease contract but does
not include a transfer in bulk or as security for or in total or
partial satisfaction of a money debt.
(p) 'Lessor' means a person who transfers the right to
possession and use of goods under a lease. Unless the context
clearly indicates otherwise, 'lessor' includes a sublessor.
(q) 'Lessor's residual interest' means the lessor's interest in
the goods after expiration, termination or cancellation of the
lease contract.
(r) 'Lien' means a charge against or interest in goods to
secure payment of a debt or performance of an obligation, but '
lien' does not include a security interest.
(s) 'Lot' means a parcel or a single article that is the
subject matter of a separate lease or delivery, whether or not it
is sufficient to perform the lease contract.
(t) 'Merchant lessee' means a lessee that is a merchant with
respect to goods of the kind subject to the lease.
(u) 'Present value' means the amount as of a date certain of
one or more sums payable in the future, discounted to the date
certain. The discount is determined by the interest rate
specified by the parties if the rate was not manifestly
unreasonable at the time the transaction was entered into;
otherwise, the discount is determined by a commercially
reasonable rate that takes into account the facts and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 99
circumstances of each case at the time the transaction was
entered into.
(v) 'Purchase' includes taking by sale, lease, mortgage,
security interest, pledge, gift or any other voluntary
transaction creating an interest in goods.
(w) 'Sublease' means a lease of goods the right to possession
and use of which was acquired by the lessor as a lessee under an
existing lease.
(x) 'Supplier' means a person from whom a lessor buys or leases
goods to be leased under a finance lease.
(y) 'Supply contract' means a contract under which a lessor
buys or leases goods to be leased.
(z) 'Termination' occurs when either party pursuant to a power
created by agreement or law puts an end to the lease contract
otherwise than for default.
(2) Other definitions applying to this chapter and the sections
in which they appear are:
(a) 'Accessions' as defined in ORS 72A.3100.
(b) 'Account' as defined in { - ORS 79.1060 - } { + section
2 of this 2001 Act + }.
(c) 'Between merchants' as defined in ORS 72.1040.
(d) 'Buyer' as defined in ORS 72.1030.
(e) 'Chattel paper' as defined in { - ORS 79.1050 - } { +
section 2 of this 2001 Act + }.
(f) 'Construction mortgage' as defined in ORS 72A.3090.
(g) 'Consumer goods' as defined in { - ORS 79.1090 - } { +
section 2 of this 2001 Act + }.
(h) 'Document' as defined in { - ORS 79.1050 - } { +
section 2 of this 2001 Act + }.
(i) 'Encumbrance' as defined in ORS 72A.3090.
(j) 'Entrusting' as defined in ORS 72.4030.
(k) 'Fixture filing' as defined in ORS 72A.3090.
(L) 'Fixtures' as defined in ORS 72A.3090.
(m) 'General { - intangibles - } { + intangible + } ' as
defined in { - ORS 79.1060 - } { + section 2 of this 2001
Act + }.
(n) 'Good faith' as defined in ORS 72.1030.
(o) 'Instrument' as defined in { - ORS 79.1050 - } { +
section 2 of this 2001 Act + }.
(p) 'Merchant' as defined in ORS 72.1040.
(q) 'Mortgage' as defined in { - ORS 79.1050 - } { +
section 2 of this 2001 Act + }.
(r) 'Purchase money lease' as defined in ORS 72A.3090.
(s) 'Pursuant to commitment' as defined in { - ORS
79.1050 - } { + section 2 of this 2001 Act + }.
(t) 'Receipt' as defined in ORS 72.1030.
(u) 'Sale' as defined in ORS 72.1060.
(v) 'Sale on approval' as defined in ORS 72.3260.
(w) 'Sale or return' as defined in ORS 72.3260.
(x) 'Seller' as defined in ORS 72.1030.
(3) In addition, ORS chapter 71 contains general definitions
and principles of construction and interpretation applicable
throughout this chapter.
SECTION 142. ORS 72A.3030 is amended to read:
72A.3030. (1) As used in this section, 'creation of a security
interest' includes the sale of a lease contract that is subject
to { - ORS 79.1020 (1)(b) - } { + section 9 (1)(c) of this
2001 Act + }.
(2) Except as provided in { - subsections - } { +
subsection + } (3) { - and (4) - } of this section { + and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 100
section 69 of this 2001 Act + }, a provision in a lease agreement
that prohibits the voluntary or involuntary transfer, including a
transfer by sale, sublease, creation or enforcement of a security
interest, or attachment, levy or other judicial process, of an
interest of a party under the lease contract or of the lessor's
residual interest in the goods, or that makes such a transfer an
event of default, gives rise to the rights and remedies provided
in subsection { - (5) - } { + (4) + } of this section, but a
transfer that is prohibited or is an event of default under the
lease agreement is otherwise effective.
{ - (3) A provision in a lease agreement that prohibits the
creation or enforcement of a security interest in an interest of
a party under the lease contract or in the lessor's residual
interest in the goods, or makes such a transfer an event of
default, is not enforceable unless, and then only to the extent
that, there is an actual transfer by the lessee of the lessee's
right of possession or use of the goods in violation of the
provision or an actual delegation of a material performance of
either party to the lease contract in violation of the provision.
Neither the granting nor the enforcement of a security interest
in the lessor's interest under the lease contract or the lessor's
residual interest in the goods is a transfer that materially
impairs the prospect of obtaining return performance by,
materially changes the duty of, or materially increases the
burden or risk imposed on, the lessee within the purview of
subsection (5) of this section unless, and then only to the
extent that, there is an actual delegation of a material
performance of the lessor. - }
{ - (4) - } { + (3) + } A provision in a lease agreement is
not enforceable if the provision prohibits a transfer of a right
to damages for default with respect to the whole lease contract
or of a right to payment arising out of the transferor's due
performance of the transferor's entire obligation or makes such a
transfer an event of default. A transfer that is not enforceable
under this section is not a transfer that materially impairs the
prospect of obtaining return performance by, materially changes
the duty of, or materially increases the burden or risk imposed
on, the other party to the lease contract under subsection
{ - (5) - } { + (4) + } of this section.
{ - (5) - } { + (4) + } Subject to { - subsections - }
{ + subsection + } (3) { - and (4) - } of this section { +
and section 69 of this 2001 Act + }:
(a) If a transfer is made that is made an event of default
under a lease agreement, the party to the lease contract not
making the transfer has the rights and remedies described in ORS
72A.5010 (2), unless the party waives the default or otherwise
agrees; { + or + }
(b) If paragraph (a) of this subsection is not applicable and a
transfer is made that is prohibited under a lease agreement or
that materially impairs the prospect of obtaining return
performance by, materially changes the duty of, or materially
increases the burden or risk imposed on, the other party to the
lease contract, then, unless the party not making the transfer
agrees at any time to the transfer in the lease contract or
otherwise, and except as limited by contract:
(A) The transferor is liable to the party not making the
transfer for damages caused by the transfer to the extent that
the damages could not reasonably be prevented by the party not
making the transfer; and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 101
(B) A court having jurisdiction may grant other appropriate
relief, including cancellation of the lease contract or an
injunction.
{ - (6) - } { + (5) + } A transfer of 'the lease' or of
'all my rights under the lease' or a transfer in similar general
terms is a transfer of rights, and unless the language or the
circumstances indicate the contrary, as in a transfer for
security, the transfer is a delegation of duties by the
transferor to the transferee. Acceptance by the transferee
constitutes a promise by the transferee to perform those duties.
The promise is enforceable by either the transferor or the other
party to the lease contract.
{ - (7) - } { + (6) + } Unless otherwise agreed by the
lessor and the lessee, a delegation of performance does not
relieve the transferor as against the other party of any duty to
perform or of any liability for default.
{ - (8) - } { + (7) + } In a consumer lease, to prohibit
the transfer of an interest of a party under the lease contract
or to make a transfer an event of default, the language must be
specific, by a writing, and conspicuous.
SECTION 143. ORS 72A.3070 is amended to read:
72A.3070. (1) Except as otherwise provided in ORS 72A.3060, a
creditor of a lessee takes subject to the lease contract.
(2) Except as otherwise provided in { - subsections - }
{ + subsection + } (3) { - and (4) - } of this section and in
ORS 72A.3060 and 72A.3080, a creditor of a lessor takes subject
to the lease contract unless { - : - }
{ - (a) - } the creditor holds a lien that attached to the
goods before the lease contract became enforceable { - ; - }
{ + . + }
{ - (b) The creditor holds a security interest in the goods
and the lessee did not give value and receive delivery of the
goods without knowledge of the security interest; or - }
{ - (c) The creditor holds a security interest in the goods
which was perfected under ORS 79.3030 before the lease contract
became enforceable. - }
{ - (3) A lessee in the ordinary course of business takes the
leasehold interest free of a security interest in the goods
created by the lessor even though the security interest is
perfected under ORS 79.3030 and the lessee knows of its
existence. - }
{ - (4) A lessee other than a lessee in the ordinary course
of business takes the leasehold interest free of a security
interest to the extent that it secures future advances made after
the secured party acquires knowledge of the lease or more than 45
days after the lease contract becomes enforceable, whichever
occurs first, unless the future advances are made pursuant to a
commitment entered into without knowledge of the lease and before
the expiration of the 45-day period. - }
{ + (3) Except as otherwise provided in sections 37, 41 and
43 of this 2001 Act, a lessee takes a leasehold interest subject
to a security interest held by a creditor of the lessor. + }
SECTION 144. ORS 72A.3090 is amended to read:
72A.3090. (1) As used in this section:
(a) Goods are 'fixtures' when they become so related to
particular real estate that an interest in them arises under real
estate law;
(b) A 'fixture filing' is the filing, in the office where a
{ + record of a + } mortgage on the real estate would be filed
or recorded, of a financing statement covering goods that are or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 102
are to become fixtures and conforming to the requirements of
{ - ORS 79.4020 (5) - } { + section 73 (1) and (2) of this
2001 Act + };
(c) A lease is a 'purchase money lease' unless the lessee has
possession or use of the goods or the right to possession or use
of the goods before the lease agreement is enforceable;
(d) A mortgage is a 'construction mortgage' to the extent it
secures an obligation incurred for the construction of an
improvement on land including the acquisition cost of the land,
if the recorded writing so indicates; and
(e) 'Encumbrance' includes real estate mortgages and other
liens on real estate and all other rights in real estate that are
not ownership interests.
(2) Under this chapter a lease may be of goods that are
fixtures or may continue in goods that become fixtures, but no
lease exists under this chapter of ordinary building materials
incorporated into an improvement on land.
(3) This chapter does not prevent creation of a lease of
fixtures pursuant to real estate law.
(4) The perfected interest of a lessor of fixtures has priority
over a conflicting interest of an encumbrancer or owner of the
real estate if:
(a) The lease is a purchase money lease, the conflicting
interest of the encumbrancer or owner arises before the goods
become fixtures, the interest of the lessor is perfected by a
fixture filing before the goods become fixtures or within 20 days
thereafter, and the lessee has an interest of record in the real
estate or is in possession of the real estate; or
(b) The interest of the lessor is perfected by a fixture filing
before the interest of the encumbrancer or owner is of record,
the lessor's interest has priority over any conflicting interest
of a predecessor in title of the encumbrancer or owner, and the
lessee has an interest of record in the real estate or is in
possession of the real estate.
(5) The interest of a lessor of fixtures, whether or not
perfected, has priority over the conflicting interest of an
encumbrancer or owner of the real estate if:
(a) The fixtures are readily removable factory or office
machines, readily removable equipment that is not primarily used
or leased for use in the operation of the real estate, or readily
removable replacements of domestic appliances that are goods
subject to a consumer lease, and before the goods become fixtures
the lease contract is enforceable;
(b) The conflicting interest is a lien on the real estate
obtained by legal or equitable proceedings after the lease
contract is enforceable;
(c) The encumbrancer or owner has consented in writing to the
lease or has disclaimed an interest in the goods as fixtures; or
(d) The lessee has a right to remove the goods as against the
encumbrancer or owner. If the lessee's right to remove
terminates, the priority of the interest of the lessor continues
for a reasonable time.
(6) Notwithstanding subsection (4)(a) of this section but
otherwise subject to subsections (4) and (5) of this section, the
interest of a lessor of fixtures, including the lessor's residual
interest, is subordinate to the conflicting interest of an
encumbrancer of the real estate under a construction mortgage
recorded before the goods become fixtures if the goods become
fixtures before the completion of the construction. To the extent
given to refinance a construction mortgage, the conflicting
Enrolled Senate Bill 171 (SB 171-ACCA) Page 103
interest of an encumbrancer of the real estate under a mortgage
has this priority to the same extent as the encumbrancer of the
real estate under the construction mortgage.
(7) In cases not within subsections (1) to (6) of this section,
priority between the interest of a lessor of fixtures, including
the lessor's residual interest, and the conflicting interest of
an encumbrancer or owner of the real estate who is not the lessee
is determined by the priority rules governing conflicting
interests in real estate.
(8) If the interest of a lessor of fixtures, including the
lessor's residual interest, has priority over all conflicting
interests of all owners and encumbrancers of the real estate, the
lessor or the lessee may on default, expiration, termination or
cancellation of the lease agreement, but subject to the lease
agreement and this chapter, or if necessary to enforce the
lessor's or lessee's other rights and remedies under this
chapter, remove the goods from the real estate, free and clear of
all conflicting interests of all owners and encumbrancers of the
real estate, but the lessor or lessee must reimburse any
encumbrancer or owner of the real estate who is not the lessee
and who has not otherwise agreed for the cost of repair of any
physical injury, but not for any diminution in value of the real
estate caused by the absence of the goods removed or by any
necessity of replacing them. A person entitled to reimbursement
may refuse permission to remove until the party seeking removal
gives adequate security for the performance of this obligation.
(9) Even though the lease agreement does not create a security
interest, the interest of a lessor of fixtures, including the
lessor's residual interest, is perfected by filing a financing
statement as a fixture filing for leased goods that are or are to
become fixtures in accordance with the relevant provisions of ORS
chapter 79.
SECTION 145. ORS 72A.3095 is amended to read:
72A.3095. (1) A financing statement filed as a fixture filing
under ORS 72A.3090 shall be recorded and indexed as a mortgage on
the real estate.
(2) { - ORS 79.4070 - } { + Section 94 of this 2001 Act + }
does not apply to a financing statement recorded and indexed as a
mortgage under this section.
SECTION 146. ORS 74.2100 is amended to read:
74.2100. (1) A collecting bank has a security interest in an
item and in any accompanying documents or in the proceeds of
either:
(a) In case of an item deposited in an account, to the extent
to which credit given for the item has been withdrawn or applied;
(b) In case of an item for which it has given credit available
for withdrawal as of right, to the extent of the credit given,
whether or not the credit is drawn upon or there is a right of
charge-back; or
(c) If it makes an advance on or against the item.
(2) If credit given for several items received at one time or
pursuant to a single agreement is withdrawn or applied in part,
the security interest remains upon all the items, any
accompanying documents or the proceeds of either. For the purpose
of this action, credits first given are first withdrawn.
(3) Receipt by a collecting bank of a final settlement for an
item is a realization on its security interest in the item,
accompanying documents and proceeds. So long as the bank does not
receive final settlement for the item or give up possession of
the item or accompanying documents for purposes other than
Enrolled Senate Bill 171 (SB 171-ACCA) Page 104
collection, the security interest continues to that extent and is
subject to ORS chapter 79, but:
(a) No security agreements are necessary to make the security
interest enforceable under { - ORS 79.2030 (1)(a) - } { +
section 13 (2)(c)(A) of this 2001 Act + };
(b) No filing is required to perfect the security interest; and
(c) The security interest has priority over conflicting
perfected security interests in the item, accompanying documents
or proceeds.
SECTION 147. { + Section 148 of this 2001 Act is added to and
made a part of ORS chapter 75. + }
SECTION 148. { + 5-118. Security interest of issuer or
nominated person. (1) An issuer or nominated person has a
security interest in a document presented under a letter of
credit to the extent that the issuer or nominated person honors
or gives value for the presentation.
(2) As long as and to the extent that an issuer or nominated
person has not been reimbursed or has not otherwise recovered the
value given with respect to a security interest in a document
under subsection (1) of this section, the security interest
continues and is subject to ORS chapter 79, but:
(a) A security agreement is not necessary to make the security
interest enforceable under section 13 (2)(c) of this 2001 Act;
(b) If the document is presented in a medium other than a
written or other tangible medium, the security interest is
perfected; and
(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 as long as the
debtor does not have possession of the document. + }
SECTION 149. ORS 77.2090 is amended to read:
77.2090. (1) A warehouseman has a lien against the bailor on
the goods covered by a warehouse receipt or on the proceeds
thereof in the possession of the warehouseman for charges for
storage or transportation (including demurrage and terminal
charges), insurance, labor, or charges present or future in
relation to the goods, and for expenses necessary for
preservation of the goods or reasonably incurred in their sale
pursuant to law. If the person on whose account the goods are
held is liable for like charges or expenses in relation to other
goods whenever deposited and it is stated in the receipt that a
lien is claimed for charges and expenses in relation to other
goods, the warehouseman also has a lien against the person for
such charges and expenses whether or not the other goods have
been delivered by the warehouseman. But against a person to whom
a negotiable warehouse receipt is duly negotiated a
warehouseman's lien is limited to charges in an amount or at a
rate specified on the receipt or if no charges are so specified
then to a reasonable charge for storage of the goods covered by
the receipt subsequent to the date of the receipt.
(2) The warehouseman may also reserve a security interest
against the bailor for a maximum amount specified on the receipt
for charges other than those specified in subsection (1) of this
section, such as for money advanced and interest. Such a security
interest is governed by ORS { - 79.1010 to 79.5070 - }
{ + chapter 79 + } on secured transactions.
(3) A warehouseman's lien for charges and expenses under
subsection (1) of this section or a security interest under
Enrolled Senate Bill 171 (SB 171-ACCA) Page 105
subsection (2) of this section is also effective against all
persons if the bailor was the legal possessor of the goods at the
time of deposit.
(4) A warehouseman loses the lien of the warehouseman on any
goods which the warehouseman voluntarily delivers or which the
warehouseman unjustifiably refuses to deliver.
SECTION 150. ORS 77.5030 is amended to read:
77.5030. (1) A document of title confers no right in goods
against a person who before issuance of the document had a legal
interest or a perfected security interest in them and who
neither:
(a) Delivered or entrusted them or any document of title
covering them to the bailor or the nominee of the bailor with
actual or apparent authority to ship, store or sell or with power
to obtain delivery under ORS 77.4030 or with power of disposition
under ORS 72.4030 and { - 79.3070 - } { + section 40 of this
2001 Act + } or other statute or rule of law; nor
(b) Acquiesced in the procurement by the bailor or the nominee
of the bailor of any document of title.
(2) Title to goods based upon an unaccepted delivery order is
subject to the rights of anyone to whom a negotiable warehouse
receipt or bill of lading covering the goods has been duly
negotiated. Such a title may be defeated under ORS 77.5040 to the
same extent as the rights of the issuer or a transferee from the
issuer.
(3) Title to goods based upon a bill of lading issued to a
freight forwarder is subject to the rights of anyone to whom a
bill issued by the freight forwarder is duly negotiated; but
delivery by the carrier in accordance with ORS 77.4010 to 77.4040
pursuant to its own bill of lading discharges the carrier's
obligation to deliver.
SECTION 151. ORS 78.1030 is amended to read:
78.1030. (1) A share or similar equity interest issued by a
corporation, business trust, joint stock company or similar
entity is a security.
(2) An 'investment company security' is a security. '
Investment company security' means a share or similar equity
interest issued by an entity that is registered as an investment
company under the federal investment company laws, an interest in
a unit investment trust that is so registered or a face-amount
certificate issued by a face-amount certificate company that is
so registered. 'Investment company security' does not include an
insurance policy, endowment policy or annuity contract issued by
an insurance company.
(3) An interest in a partnership or limited liability company
is not a security unless it is dealt in or traded on securities
exchanges or in securities markets, its terms expressly provide
that it is a security governed by this chapter or it is an
investment company security. However, an interest in a
partnership or limited liability company is a financial asset if
it is held in a securities account.
(4) A writing that is a security certificate is governed by
this chapter and not by ORS chapter 73, even though it also meets
the requirements of that chapter. However, a negotiable
instrument governed by ORS chapter 73 is a financial asset if it
is held in a securities account.
(5) An option or similar obligation issued by a clearing
corporation to its participants is not a security, but is a
financial asset.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 106
(6) A commodity contract, as defined in { - ORS 79.1150 - }
{ + section 2 of this 2001 Act + }, is not a security or a
financial asset.
SECTION 152. ORS 78.1060 is amended to read:
78.1060. (1) A purchaser has control of a certificated security
in bearer form if the certificated security is delivered to the
purchaser.
(2) A purchaser has control of a certificated security in
registered form if the certificated security is delivered to the
purchaser, and:
(a) The certificate is indorsed to the purchaser or in blank by
an effective indorsement; or
(b) The certificate is registered in the name of the purchaser,
upon original issue or registration of transfer by the issuer.
(3) A purchaser has control of an uncertificated security if:
(a) The uncertificated security is delivered to the purchaser;
or
(b) The issuer has agreed to comply with instructions
originated by the purchaser without further consent by the
registered owner.
(4) A purchaser has control of a security entitlement if:
(a) The purchaser becomes the entitlement holder; { - or - }
(b) The securities intermediary has agreed to comply with
entitlement orders originated by the purchaser without further
consent by the entitlement holder { + ; or
(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 the person has
control on behalf of the purchaser + }.
(5) If an interest in a security entitlement is granted by the
entitlement holder to the entitlement holder's own securities
intermediary, the securities intermediary has control.
(6) A purchaser who has satisfied the requirements of
subsection (3) { - (b) - } or (4) { - (b) - } of this section
has control { + , + } even if the registered owner in the case of
subsection (3) { - (b) - } of this section, or the entitlement
holder in the case of subsection (4) { - (b) - } of this
section, 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.
(7) An issuer or a securities intermediary may not enter into
an agreement of the kind described in subsection (3)(b) or (4)(b)
of this section without the consent of the registered owner or
entitlement holder, but an issuer or a securities intermediary is
not required to enter into such an agreement even though the
registered owner or entitlement holder so directs. An issuer or
securities intermediary that has entered into such an agreement
is not required to confirm the existence of the agreement to
another party unless requested to do so by the registered owner
or entitlement holder.
SECTION 153. ORS 78.1100 is amended to read:
78.1100. (1) The local law of the issuer's jurisdiction, as
defined in subsection (4) of this section, governs:
(a) The validity of a security;
(b) The rights and duties of the issuer with respect to
registration of transfer;
(c) The effectiveness of registration of transfer by the
issuer;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 107
(d) Whether the issuer owes any duties to an adverse claimant
to a security; and
(e) Whether an adverse claim can be asserted against a person
to whom transfer of a certificated or uncertificated security is
registered or a person who obtains control of an uncertificated
security.
(2) The local law of the securities intermediary's
jurisdiction, as specified in subsection (5) of this section,
governs:
(a) Acquisition of a security entitlement from the securities
intermediary;
(b) The rights and duties of the securities intermediary and
entitlement holder arising out of a security entitlement;
(c) Whether the securities intermediary owes any duties to an
adverse claimant to a security entitlement; and
(d) Whether an adverse claim can be asserted against a person
who acquires a security entitlement from the securities
intermediary or a person who purchases a security entitlement or
interest therein from an entitlement holder.
(3) The local law of the jurisdiction in which a security
certificate is located at the time of delivery governs whether an
adverse claim can be asserted against a person to whom the
security certificate is delivered.
(4) 'Issuer's jurisdiction' means the jurisdiction under which
the issuer of the security is organized or, if permitted by the
law of that jurisdiction, the law of another jurisdiction
specified by the issuer. An issuer organized under the law of
this state may specify the law of another jurisdiction as the law
governing the matters specified in subsection (1)(b) to (e) of
this section.
(5) The following rules determine a securities intermediary's
jurisdiction for purposes of this section:
(a) If an agreement between the securities intermediary and its
entitlement holder { - specifies that the agreement 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 ORS 78.1010 to 78.1160, this chapter or ORS chapter
79 + }, that jurisdiction is the securities intermediary's
jurisdiction.
{ + (b) If paragraph (a) of this subsection 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. + }
{ - (b) - } { + (c) + } If { + neither paragraph (a) nor
(b) of this subsection applies and + } an agreement between the
securities intermediary and its entitlement holder { - does not
specify the governing law as provided in paragraph (a) of this
subsection, 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.
{ - (c) - } { + (d) + } { - If an agreement between the
securities intermediary and its entitlement holder does not
specify a jurisdiction as provided in paragraph (a) or (b) of
this subsection - } { + If paragraphs (a) to (c) of this
subsection do not apply + }, the securities intermediary's
Enrolled Senate Bill 171 (SB 171-ACCA) Page 108
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 + }.
{ - (d) - } { + (e) + } { - If an agreement between the
securities intermediary and its entitlement holder does not
specify a jurisdiction as provided in paragraph (a) or (b) of
this subsection and an account statement does not identify an
office serving the entitlement holder's account as provided in
paragraph (c) of this subsection, - } { + If paragraphs (a) to
(d) of this subsection do not apply, + } the securities
intermediary's jurisdiction is the jurisdiction in which { - is
located - } the chief executive office of the securities
intermediary { + is located + }.
(6) A securities intermediary's jurisdiction is not determined
by the physical location of certificates representing financial
assets, by the jurisdiction in which is organized the issuer of
the financial asset for which an entitlement holder has a
security entitlement or by the location of facilities for data
processing or other record keeping concerning the account.
SECTION 154. ORS 78.3010 is amended to read:
78.3010. (1) Delivery of a certificated security to a purchaser
occurs when:
(a) The purchaser acquires possession of the security
certificate;
(b) Another person, other than a securities intermediary,
either acquires possession of the security certificate on behalf
of the purchaser or, having previously acquired possession of the
certificate, acknowledges that it holds for the purchaser; or
(c) 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 - } { + is
(i) registered in the name of the purchaser, (ii) payable to the
order of the purchaser, or (iii) + } specially indorsed to the
purchaser by an effective indorsement { + and has not been
indorsed to the securities intermediary or in blank + }.
(2) Delivery of an uncertificated security to a purchaser
occurs when:
(a) The issuer registers the purchaser as the registered owner,
upon original issue or registration of transfer; or
(b) Another person, other than a securities intermediary,
either becomes the registered owner of the uncertificated
security on behalf of the purchaser or, having previously become
the registered owner, acknowledges that it holds for the
purchaser.
SECTION 155. ORS 78.3020 is amended to read:
78.3020. (1) Except as otherwise provided in subsections (2)
and (3) of this section, { - 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.
(2) A purchaser of a limited interest acquires rights only to
the extent of the interest purchased.
(3) A purchaser of a certificated security who as a previous
holder had notice of an adverse claim does not improve its
position by taking from a protected purchaser.
SECTION 156. ORS 78.5100 is amended to read:
78.5100. (1) { - An - } { + In a case not covered by the
priority rules in ORS chapter 79 or the rules stated in
subsection (3) of this section, an + } action based on an adverse
claim to a financial asset or security entitlement, whether
Enrolled Senate Bill 171 (SB 171-ACCA) Page 109
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.
(2) If an adverse claim could not have been asserted against an
entitlement holder under ORS 78.5020, the adverse claim cannot be
asserted against a person who purchases a security entitlement,
or an interest therein, from the entitlement holder.
(3) In a case not covered by the priority rules in ORS chapter
79, 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 subsection (4) of this section,
purchasers + } who have control rank { - equally, except that
a - } { + according to priority in time of:
(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 ORS 78.1060
(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 ORS 78.1060 (4)(b); or
(c) If the purchaser obtained control through another person
under ORS 78.1060 (4)(c), the time on which priority would be
based under this subsection if the other person were the secured
party.
(4) A + } securities intermediary as purchaser has priority
over a conflicting purchaser who has control unless otherwise
agreed by the securities intermediary.
SECTION 157. ORS 79.8010 is amended to read:
79.8010. Except as provided in ORS 30.260 to 30.300, the
Secretary of State and the secretary's officers and employees
shall not be liable to debtors, secured parties or any other
person in administering this chapter { + or ORS 79.6020 to
79.7010 + }.
SECTION 158. { + ORS 79.8010 is added to and made a part of
sections 72 to 98 of this 2001 Act. + }
SECTION 159. ORS 29.205 is amended to read:
29.205. (1) Delivery of a writ of garnishment in accordance
with ORS 29.155 to 29.185 shall be effective to garnish all
property of the defendant which is in the garnishee's possession,
control or custody at the time of delivery of the writ of
garnishment to the garnishee, including but not limited to
property in safe deposit boxes, stock, debts and other
obligations then in existence and payable in money, whether due
or to become due, property held on expired and unexpired
bailments and leases, and property held by the garnishee pursuant
to a security interest granted by defendant to garnishee.
(2) Notwithstanding any other provision of this chapter, but
except as provided in ORS 29.375, the duty of a garnishee to
deliver any property of the defendant which may be contained in a
safe deposit box which is in the garnishee's possession, control
or custody at the time of delivery of the writ of garnishment to
the garnishee is conditioned upon the plaintiff's first paying to
the garnishee, in addition to the search fee provided for in ORS
29.377 (1), all reasonable costs incurred by the garnishee in
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gaining entry to the safe deposit box. The costs shall be paid to
the garnishee by the plaintiff on or before the date the
plaintiff pays the sheriff's fees under ORS 29.237. If the
plaintiff fails to pay such costs to the garnishee, the
garnishment shall not be effective to garnish any property of the
defendant which may be contained in any such safe deposit box and
the garnishee may proceed to deal with the safe deposit box and
its contents as though the writ of garnishment had not been
issued. Nothing in this section limits the right of a plaintiff
to reach the contents of any safe deposit box in any manner
otherwise provided by law.
(3) Notwithstanding subsection (1) of this section, property
which may not be taken by garnishment shall include but is not
limited to equitable interests, property in the custody of the
law, property in the possession of a conservator and property in
the possession of a personal representative constituting the
subject matter of a trust contained in a duly probated will of a
decedent.
(4) Notwithstanding any other provision of law, and except for
workers' compensation or property in the custody of the law, when
a garnishment is issued to collect past due support, no exemption
may be allowed for amounts due the obligated parent that are the
result of lump sum or periodic payments on a judgment, settlement
or public or private retirement funds.
(5) In addition to such rights as the garnishee may have at
law, in equity or otherwise, if the garnishee is a financial
institution, the garnishee may, following delivery of a writ of
garnishment or warrant and notice of garnishment to the
garnishee, set off such sums as are due from defendant at the
time the garnishee receives the writ of garnishment. A garnishee
may not set off any amounts which are not otherwise due to be
paid but which have been accelerated after the receipt of a writ
of garnishment. Notwithstanding any other provision of this
chapter, such a garnishee shall have no obligation to remit any
sums upon the garnishment which the garnishee has set off
pursuant to this subsection. A garnishee who sets off pursuant to
this subsection shall disclose the fact and amount of the setoff
in the certificate of garnishee prepared and delivered under ORS
29.235, and shall certify therein that the amount set off by the
garnishee was due from the defendant to the garnishee at the time
the garnishee received the writ of garnishment.
(6) Notwithstanding subsection (1) of this section, if a writ
of garnishment is received by a financial institution garnishee
after 4 p.m., as to any deposit account held by the garnishee in
the name of the defendant, the writ of garnishment will only be
effective to garnish those funds that are on deposit in the
account at the beginning of the business day following the day on
which the writ of garnishment is delivered to the garnishee.
(7) Notwithstanding any other provision of this chapter, if a
garnishee discovers that a voluntary or involuntary bankruptcy
petition has been filed by or on behalf of the defendant under
section 301, 302 or 303 of the United States Bankruptcy Code (11
U.S.C. 101 to 1330) before the garnishee delivers the garnishee's
certificate pursuant to ORS 29.235, the garnishment of any
property of the defendant in the garnishee's possession, control
or custody is stayed pursuant to section 362 of the United States
Bankruptcy Code (11 U.S.C. 362).
(8)(a) Notwithstanding subsection (1) of this section, a
garnishee may apply a setoff against amounts owing to the
defendant under the terms of a land sale contract, under the
Enrolled Senate Bill 171 (SB 171-ACCA) Page 111
terms of a promissory note or other evidence of indebtedness that
is secured by a mortgage or trust deed, or under the terms of a
security agreement as defined { - by ORS 79.1050 - } { + in
section 2 of this 2001 Act + }, to the extent that those amounts
are actually paid to another person:
(A) Who is entitled to receive the amounts under the terms of
the land sale contract, mortgage, trust deed or security
agreement, or under the terms of any other land sale contract,
mortgage, trust deed or security agreement that is secured by the
same property that is the subject of the land sale contract,
mortgage, trust deed or security agreement; and
(B) Who has an interest in the property that is the subject of
the land sale contract, mortgage, trust deed or security
agreement that is superior to the interest of the plaintiff under
the laws that would govern a foreclosure, trust deed sale,
repossession or other action against the property that is the
subject of the land sale contract, mortgage, trust deed or
security agreement.
(b) A garnishee must deliver to a plaintiff all amounts in the
garnishee's possession, control or custody at the time of
delivery of the writ of garnishment that are not actually paid by
the garnishee to another person as described in paragraph (a) of
this subsection unless those amounts are exempt from execution
under other law.
(c) A garnishee who applies a setoff under this subsection must
disclose that the setoff has been applied, and the amount of the
setoff, in the certificate of garnishee prepared and delivered
under ORS 29.235. The garnishee must certify in the certificate
that the amounts specified in the certificate were actually paid
by the garnishee to another person entitled to receive those
amounts under paragraph (a) of this subsection.
(9) For the purposes of this section, 'financial institution'
has the meaning given that term in ORS 706.008.
SECTION 159a. { + If House Bill 2386 becomes law, section 159
of this 2001 Act (amending ORS 29.205) is repealed and section 9,
chapter 249, Oregon Laws 2001 (Enrolled House Bill 2386), is
amended to read: + }
{ + Sec. 9. + } (1) Notwithstanding section 7 { + , chapter
249, Oregon Laws 2001 (Enrolled House Bill 2386) + } { - of
this 2001 Act - } , a garnishee may apply a setoff against
amounts owing to the debtor under the terms of a land sale
contract, under the terms of a promissory note or other evidence
of indebtedness that is secured by a mortgage or trust deed, or
under the terms of a security agreement as defined in { - ORS
79.1050 - } { + section 2 of this 2001 Act + }, to the extent
that those amounts are actually paid to another person:
(a) Who is entitled to receive the amounts under the terms of
the land sale contract, mortgage, trust deed or security
agreement, or under the terms of any other land sale contract,
mortgage, trust deed or security agreement that is secured by the
same property that is the subject of the land sale contract,
mortgage, trust deed or security agreement; and
(b) Who has an interest in the property that is the subject of
the land sale contract, mortgage, trust deed or security
agreement that is superior to the interest of the creditor under
the laws that would govern a foreclosure, trust deed sale,
repossession or other action against the property that is the
subject of the land sale contract, mortgage, trust deed or
security agreement.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 112
(2) A garnishee must deliver in the manner required by sections
1 to 65 { + , chapter 249, Oregon Laws 2001 (Enrolled House Bill
2386), + } { - of this 2001 Act - } all amounts in the
garnishee's possession, control or custody at the time of
delivery of the writ of garnishment that are not actually paid by
the garnishee to another person as described in subsection (1) of
this section, unless those amounts are exempt from execution
under other law.
(3) A garnishee who applies a setoff under this section must
disclose that the setoff has been applied, and the amount of the
setoff, in the garnishee response required by section 24 { + ,
chapter 249, Oregon Laws 2001 (Enrolled House Bill 2386) + }
{ - of this 2001 Act - } . The garnishee must certify in the
garnishee response that the amounts specified in the certificate
were actually paid by the garnishee to another person entitled to
receive those amounts under subsection (1) of this section.
SECTION 159b. { + The repeal of section 159 of this 2001 Act
and the amendments to section 9, chapter 249, Oregon Laws 2001
(Enrolled House Bill 2386), by section 159a of this 2001 Act
become operative on the effective date of chapter 249, Oregon
Laws 2001 (Enrolled House Bill 2386). + }
SECTION 160. ORS 56.041, as amended by section 4, chapter 652,
Oregon Laws 1999, is amended to read:
56.041. (1) The Operating Account is established in the General
Fund of the State Treasury.
(2) The net amount accruing to the Secretary of State from all
fees, charges, interest, fines, penalties and miscellaneous
revenues from all sources relating to business registry
functions, and moneys received by the Secretary of State under
ORS chapters 79 and 194 and ORS { + 79.6020 to 79.7010, + }
87.246, 87.767 and 87.806 to 87.831 shall, after deduction of
refunds, be paid over to the State Treasurer and deposited at
least monthly in the Operating Account.
(3) Moneys deposited to the credit of the Operating Account are
continuously appropriated for the expenses of carrying out the
functions and duties of the Secretary of State relating to
business registry, and the functions and duties of the Secretary
of State under ORS chapters 79 and 194 and ORS { + 79.6020 to
79.7010, + } 87.246, 87.767 and 87.806 to 87.831.
SECTION 161. ORS 83.610 is amended to read:
83.610. After the payment of all sums for which the buyer is
obligated under a retail installment contract or other security
agreement, as defined in { - ORS 79.1050 - } { + section 2 of
this 2001 Act + }, and upon written demand made by the buyer, the
holder of such contract or agreement shall mail to the buyer at
the buyer's last-known address, good and sufficient instruments
to indicate payment in full and to release all security in the
motor vehicle. This section is supplementary to and is not
restrictive of ORS 86.440, 86.460 and 803.097 or of ORS
{ - 79.1010 to 79.5070 and 79.8010 - } { + chapter 79 + }.
SECTION 162. ORS 87.322 is amended to read:
87.322. ORS 87.272 to 87.316 does not apply to a lien on a
chattel created by ORS 87.216 when that chattel is subject to a
prior duly perfected security interest as provided in ORS 87.146
(1)(d). When a lien created by ORS 87.216 is junior and
subordinate to a prior duly perfected security interest, that
lien shall be foreclosed by suit under ORS chapter 88. In such a
suit to foreclose, the holder of the prior security interest
shall be made a party defendant to the foreclosure proceeding.
The person holding the prior security interest may extinguish the
Enrolled Senate Bill 171 (SB 171-ACCA) Page 113
lien created by ORS 87.216 by either a foreclosure proceeding
under ORS chapter 88 or a nonjudicial foreclosure proceeding
under { - ORS 79.5010 to 79.5070 - } { + sections 99 to 126
of this 2001 Act + }.
SECTION 163. ORS 87.755 is amended to read:
87.755. (1) When an agricultural producer sells grain, the
agricultural producer shall have a lien on the grain and the
proceeds thereof for a period not to exceed 90 days from the date
the lien attaches.
(2) The lien created by subsection (1) of this section shall
attach to the grain and to the proceeds thereof on the date the
agricultural producer sells the grain to the purchaser or on the
date the agricultural producer physically delivers the grain to
the purchaser, whichever last occurs.
(3) The lien created by subsection (1) of this section shall be
preferred to any lien or security interest in favor of any
creditor of the purchaser, regardless of whether the creditor's
lien or security interest attached to the grain or proceeds
before or after the date on which the agricultural producer's
lien attached under subsection (2) of this section.
(4) An agricultural producer who claims a lien under subsection
(1) of this section need not file any notice of the lien in order
to perfect the lien.
(5) The lien created by subsection (1) of this section shall be
subject to the provisions of { - ORS 79.3070 (1) - } { +
section 40 of this 2001 Act + }.
(6) The lien created by subsection (1) of this section is
discharged, except as to the proceeds therefrom, upon sale of the
grain by the purchaser to a third party purchaser.
SECTION 164. ORS 87.816 is amended to read:
87.816. (1) If a notice of federal lien, a refiling of a notice
of federal lien, or a notice of revocation of any certificate
described in subsection (2) of this section is presented to a
filing officer who is:
(a) The Secretary of State, the secretary shall cause the
notice or refiled notice to be marked, held and indexed in
accordance with the provisions of { - ORS 79.4030 (4) - }
{ + section 90 of this 2001 Act + } as if the notice or refiled
notice were a financing statement within the meaning of ORS
{ - 79.1010 to 79.5070 and 79.8010 - } { + chapter 79 + }; or
(b) Any other officer described in ORS 87.806, the officer
shall indorse thereon the identification of the officer and the
date and time of receipt and forthwith file it alphabetically or
enter it in an alphabetical index showing the name and address of
the person named in the notice or refiled notice, the date and
time of receipt, the title and address of the official or entity
certifying the lien and the total amount appearing on the notice
of lien or refiled notice of lien.
(2) If a certificate of release, nonattachment, discharge or
subordination of any lien is presented to the Secretary of State
for filing, the secretary shall:
(a) Cause a certificate of release to be marked, held and
indexed as if the certificate were a termination statement within
the meaning of { - ORS 79.4040 - } { + section 83 of this
2001 Act + };
(b) Cause a certificate of discharge or subordination to be
held, marked and indexed as if the certificate were a release of
collateral within the meaning of { - ORS 79.4060 - } { +
section 83 of this 2001 Act + }; and
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(c) Cause a certificate of nonattachment to be marked, held and
indexed as if the certificate were an amendment of a financing
statement within the meaning of { - ORS 79.4020 (4) - } { +
section 83 of this 2001 Act + }.
(3) If any refiled notice of federal lien or notice of
revocation referred to in subsection (1) of this section or any
of the certificates specified in subsection (2) of this section
is presented for filing with any other filing officer specified
in ORS 87.806, the officer shall permanently attach the refiled
notice, certificate or notice to the original notice of lien and
shall enter the refiled notice, certificate or notice with the
date of filing in any alphabetical lien index on the line where
the original notice of lien is entered.
(4) Upon request of any person, the filing officer shall issue
the certificate of the filing officer showing whether there is on
file in the officer's office, on the date and hour stated
therein, any notice of lien or certificate or notice affecting
any lien naming a particular person, and if a notice or
certificate is on file, giving the date and hour of its filing.
All financing statements and statements of assignment, if any,
filed pursuant to ORS { - 79.1010 to 79.5070 and 79.8010 - }
{ + chapter 79 + } for a particular debtor whose name is
identical to the particular person named in the lien shall be
shown on this certificate. The uniform fee for such a certificate
for a particular person shall be prescribed by the Secretary of
State by rule. If the request for the certificate is in writing
and not in the standard form prescribed by the Secretary of
State, an additional fee shall be prescribed. Upon request the
filing officer shall furnish a copy of any notice of federal lien
or notice or certificate affecting a federal lien for a fee as
prescribed by the Secretary of State by rule under { - ORS
79.4025 - } { + section 96 of this 2001 Act + }.
(5) Notice of a federal lien or a refiling of a notice of
federal lien is effective for a period of 10 years from the date
of assessment. A notice or refiling of a notice of a federal lien
shall state:
(a) The date the tax was assessed; and
(b) That the effective period of the lien is as provided by
federal law.
SECTION 165. ORS 90.425 is amended to read:
90.425. (1) As used in this section:
(a) 'Current market value' means the amount in cash, as
determined by the county assessor, that could reasonably be
expected to be paid for a manufactured dwelling or floating home
by an informed buyer to an informed seller, each acting without
compulsion in an arm's length transaction occurring on the
assessment date for the tax year or on the date of a subsequent
reappraisal by the county assessor.
(b) 'Dispose of the personal property' means that, if
reasonably appropriate, the landlord may throw away the property
or may give it without consideration to a nonprofit organization
or to a person unrelated to the landlord. The landlord may not
retain the property for personal use or benefit.
(c) 'Goods' includes those goods left inside a recreational
vehicle, manufactured dwelling or floating home or left upon the
rental space outside a recreational vehicle, manufactured
dwelling or floating home, whether the recreational vehicle,
dwelling or home is located inside or outside of a facility.
(d) 'Lienholder' means any lienholder of an abandoned
recreational vehicle, manufactured dwelling or floating home, if
Enrolled Senate Bill 171 (SB 171-ACCA) Page 115
the lien is of record or the lienholder is actually known to the
landlord.
(e) 'Owner' means any owner of an abandoned recreational
vehicle, manufactured dwelling or floating home, if different
from the tenant and either of record or actually known to the
landlord.
(f) 'Personal property' means goods, vehicles and recreational
vehicles and includes manufactured dwellings and floating homes
not located in a facility. 'Personal property ' does not include
manufactured dwellings and floating homes located in a facility
and therefore subject to being stored, sold or disposed of as
provided under ORS 90.675.
(2) A landlord shall not store, sell or dispose of abandoned
personal property except as provided by this section. This
section governs the rights and obligations of landlords, tenants
and any lienholders or owners in any personal property abandoned
or left upon the premises by the tenant or any lienholder or
owner in the following circumstances:
(a) The tenancy has ended by termination or expiration of a
rental agreement or by relinquishment or abandonment of the
premises and the landlord reasonably believes under all the
circumstances that the tenant has left the personal property upon
the premises with no intention of asserting any further claim to
the premises or to the personal property;
(b) The tenant has been absent from the premises continuously
for seven days after termination of a tenancy by a court order
that has not been executed; or
(c) The landlord elects to remove the personal property
pursuant to ORS 105.165.
(3) Prior to selling or disposing of the tenant's personal
property under this section, the landlord must give a written
notice to the tenant which shall be:
(a) Personally delivered to the tenant; or
(b) Sent by first class mail addressed and mailed to the tenant
at:
(A) The premises;
(B) Any post-office box held by the tenant and actually known
to the landlord; and
(C) The most recent forwarding address if provided by the
tenant or actually known to the landlord.
(4)(a) In addition to the notice required by subsection (3) of
this section, in the case of an abandoned recreational vehicle,
manufactured dwelling or floating home, a landlord shall also
give a copy of the notice described in subsection (3) of this
section to:
(A) Any lienholder of the recreational vehicle, manufactured
dwelling or floating home;
(B) Any owner of the recreational vehicle, manufactured
dwelling or floating home;
(C) The tax collector of the county where the manufactured
dwelling or floating home is located; and
(D) The assessor of the county where the manufactured dwelling
or floating home is located.
(b) The landlord shall give the notice copy required by this
subsection by personal delivery or first class mail, except that
for any lienholder, mail service shall be by first class mail
with certificate of mailing.
(5) The notice required under subsection (3) of this section
shall state that:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 116
(a) The personal property left upon the premises is considered
abandoned;
(b) The tenant or any lienholder or owner must contact the
landlord by a specified date, as provided in subsection (6) of
this section, to arrange for the removal of the abandoned
personal property;
(c) The personal property is stored at a place of safekeeping,
except that if the property includes a manufactured dwelling or
floating home, the dwelling or home shall be stored on the rented
space;
(d) The tenant or any lienholder or owner, except as provided
by subsection (17) of this section, may arrange for removal of
the personal property by contacting the landlord at a described
telephone number or address on or before the specified date;
(e) The landlord shall make the personal property available for
removal by the tenant or any lienholder or owner, except as
provided by subsection (17) of this section, by appointment at
reasonable times;
(f) If the personal property is considered to be abandoned
pursuant to subsection (2)(a) or (b) of this section, the
landlord may require payment of removal and storage charges, as
provided by subsection (7)(d) of this section, prior to releasing
the personal property to the tenant or any lienholder or owner;
(g) If the personal property is considered to be abandoned
pursuant to subsection (2)(c) of this section, the landlord shall
not require payment of storage charges prior to releasing the
personal property;
(h) If the tenant or any lienholder or owner fails to contact
the landlord by the specified date, or after that contact, fails
to remove the personal property within 30 days for recreational
vehicles, manufactured dwellings and floating homes or 15 days
for all other personal property, the landlord may sell or dispose
of the personal property. If the landlord reasonably believes
that the personal property will be eligible for disposal pursuant
to subsection (10)(b) of this section and the landlord intends to
dispose of the property if it is not claimed, the notice shall
state that belief and intent; and
(i) If the personal property includes a recreational vehicle,
manufactured dwelling or floating home and if applicable, there
is a lienholder or owner that has a right to claim the
recreational vehicle, dwelling or home, except as provided by
subsection (17) of this section.
(6) For purposes of subsection (5) of this section, the
specified date by which a tenant, lienholder or owner must
contact a landlord to arrange for the disposition of abandoned
personal property shall be:
(a) For abandoned recreational vehicles, manufactured dwellings
or floating homes, not less than 45 days after personal delivery
or first class mailing of the notice; or
(b) For all other abandoned personal property, not less than
five days after personal delivery or eight days after first class
mailing of the notice.
(7) After notifying the tenant as required by subsection (3) of
this section, the landlord:
(a) Shall store any abandoned manufactured dwelling or floating
home on the rented space and shall exercise reasonable care for
the dwelling or home;
(b) Shall store all other abandoned personal property of the
tenant, including goods left inside a recreational vehicle,
manufactured dwelling or floating home or left upon the rented
Enrolled Senate Bill 171 (SB 171-ACCA) Page 117
space outside a recreational vehicle, dwelling or home, in a
place of safekeeping and shall exercise reasonable care for the
personal property, except that the landlord may:
(A) Promptly dispose of rotting food; and
(B) Allow an animal control agency to remove any abandoned pets
or livestock. If an animal control agency will not remove the
abandoned pets or livestock, the landlord shall exercise
reasonable care for the animals given all the circumstances,
including the type and condition of the animals, and may give the
animals to an agency that is willing and able to care for the
animals, such as a humane society or similar organization;
(c) Except for manufactured dwellings and floating homes, may
store the abandoned personal property at the dwelling unit, move
and store it elsewhere on the premises or move and store it at a
commercial storage company or other place of safekeeping; and
(d) Shall be entitled to reasonable or actual storage charges
and costs incidental to storage or disposal, including any cost
of removal to a place of storage. In the case of an abandoned
manufactured dwelling or floating home, the storage charge shall
be no greater than the monthly space rent last payable by the
tenant.
(8) If a tenant, lienholder or owner, upon the receipt of the
notice provided by subsection (3) or (4) of this section or
otherwise, responds by actual notice to the landlord on or before
the specified date in the landlord's notice that the tenant,
lienholder or owner intends to remove the personal property from
the premises or from the place of safekeeping, the landlord must
make that personal property available for removal by the tenant,
lienholder or owner by appointment at reasonable times during the
next 15 days or, in the case of a recreational vehicle,
manufactured dwelling or floating home, 30 days, subject to
subsection (17) of this section. If the personal property is
considered to be abandoned pursuant to subsection (2)(a) or (b)
of this section, but not pursuant to subsection (2)(c) of this
section, the landlord may require payment of removal and storage
charges, as provided in subsection (7)(d) of this section, prior
to allowing the tenant, lienholder or owner to remove the
personal property. Acceptance by a landlord of such payment shall
not operate to create or reinstate a tenancy or create a waiver
pursuant to ORS 90.415.
(9) Except as provided in subsections (17) to (19) of this
section, if the tenant, lienholder or owner of a recreational
vehicle, manufactured dwelling or floating home does not respond
within the time provided by the landlord's notice, or the tenant,
lienholder or owner does not remove the personal property within
the time required by subsection (8) of this section or by any
date agreed to with the landlord, whichever is later, the
tenant's, lienholder's or owner's personal property shall be
conclusively presumed to be abandoned. The tenant and any
lienholder or owner that have been given notice pursuant to
subsection (3) or (4) of this section shall, except with regard
to the distribution of sale proceeds pursuant to subsection (12)
of this section, have no further right, title or interest to the
personal property and may not claim or sell the property.
(10) If the personal property is presumed to be abandoned under
subsection (9) of this section, the landlord then may:
(a) Sell the personal property at a public or private sale,
provided that prior to the sale of a recreational vehicle,
manufactured dwelling or floating home:
Enrolled Senate Bill 171 (SB 171-ACCA) Page 118
(A) The landlord may seek to transfer the certificate of title
and registration to the personal property by complying with the
requirements of the appropriate state agency; and
(B) The landlord shall:
(i) Place a notice in a newspaper of general circulation in the
county in which the recreational vehicle, manufactured dwelling
or floating home is located. The notice shall state:
(I) That the recreational vehicle, manufactured dwelling or
floating home is abandoned;
(II) The tenant's and owner's name, if of record or actually
known to the landlord;
(III) The address and any space number where the recreational
vehicle, manufactured dwelling or floating home is located, and
if actually known to the landlord, the plate, registration or
other identification number as noted on the certificate of title;
(IV) Whether the sale is by private bidding or public auction;
(V) Whether the landlord is accepting sealed bids and, if so,
the last date on which bids will be accepted; and
(VI) The name and telephone number of the person to contact to
inspect the recreational vehicle, manufactured dwelling or
floating home;
(ii) At a reasonable time prior to the sale, give a copy of the
notice required by sub-subparagraph (i) of this subparagraph to
the tenant and to any lienholder and owner, by personal delivery
or first class mail, except that for any lienholder, mail service
shall be by first class mail with certificate of mailing;
(iii) Obtain an affidavit of publication from the newspaper to
show that the notice required under sub-subparagraph (i) of this
subparagraph ran in the newspaper at least one day in each of two
consecutive weeks prior to the date scheduled for the sale or the
last date bids will be accepted; and
(iv) Obtain written proof from the county that all property
taxes on the manufactured dwelling or floating home have been
paid or, if not paid, that the county has authorized the sale,
with the sale proceeds to be distributed pursuant to subsection
(12) of this section;
(b) Destroy or otherwise dispose of the personal property if
the landlord determines that:
(A) For a manufactured dwelling or floating home, the current
market value of the property is $3,500 or less as determined by
the county assessor; or
(B) For all other personal property, the reasonable current
fair market value is $500 or less or so low that the cost of
storage and conducting a public sale probably exceeds the amount
that would be realized from the sale; or
(c) Consistent with paragraphs (a) and (b) of this subsection,
sell certain items and destroy or otherwise dispose of the
remaining personal property.
(11)(a) A public or private sale authorized by this section
shall:
(A) For a recreational vehicle, manufactured dwelling or
floating home, be conducted consistent with the terms listed in
subsection (10)(a)(B)(i) of this section. Every aspect of the
sale including the method, manner, time, place and terms must be
commercially reasonable; or
(B) For all other personal property, be conducted under the
provisions of { - ORS 79.5040 (3) - } { + section 108 of this
2001 Act + }.
(b) If there is no buyer at a sale of a manufactured dwelling
or floating home, the personal property shall be considered to be
Enrolled Senate Bill 171 (SB 171-ACCA) Page 119
worth $3,500 or less, regardless of current market value, and the
landlord may destroy or otherwise dispose of the personal
property.
(12)(a) The landlord may deduct from the proceeds of the sale:
(A) The reasonable or actual cost of notice, storage and sale;
and
(B) Unpaid rent.
(b) If the sale was of a manufactured dwelling or floating
home, after deducting the amounts listed in paragraph (a) of this
subsection, the landlord shall remit the remaining proceeds, if
any, to the county tax collector to the extent of any unpaid
property taxes owed on the dwelling or home.
(c) If the sale was of a recreational vehicle, manufactured
dwelling or floating home, after deducting the amounts listed in
paragraphs (a) and (b) of this subsection, if applicable, the
landlord shall remit the remaining proceeds, if any, to any
lienholder to the extent of any unpaid balance owed on the lien
on the recreational vehicle, dwelling or home.
(d) After deducting the amounts listed in paragraphs (a), (b)
and (c) of this subsection, if applicable, the landlord shall
remit to the tenant or owner the remaining proceeds, if any,
together with an itemized accounting.
(e) If the tenant or owner cannot after due diligence be found,
the remaining proceeds shall be deposited with the county
treasurer of the county in which the sale occurred, and if not
claimed within three years shall revert to the general fund of
the county available for general purposes.
(13) The county tax collector shall cancel all unpaid property
taxes owed on a manufactured dwelling or floating home, as
provided under ORS 311.790, if:
(a) The landlord disposes of the manufactured dwelling or
floating home after a determination described in subsection
(10)(b) of this section;
(b) There is no buyer of the manufactured dwelling or floating
home at a sale described under subsection (11) of this section;
or
(c) The proceeds of a sale described under subsection (11) of
this section are insufficient to satisfy the unpaid property
taxes owed on the dwelling or home after distribution of the
proceeds pursuant to subsection (12) of this section.
(14) The landlord shall not be responsible for any loss to the
tenant, lienholder or owner resulting from storage of personal
property in compliance with this section unless the loss was
caused by the landlord's deliberate or negligent act. In the
event of a deliberate and malicious violation, the landlord shall
be liable for twice the actual damages sustained by the tenant,
lienholder or owner.
(15) Complete compliance in good faith with this section shall
constitute a complete defense in any action brought by a tenant,
lienholder or owner against a landlord for loss or damage to such
personal property disposed of pursuant to this section.
(16) If a landlord does not comply with this section:
(a) The tenant shall be relieved of any liability for damage to
the premises caused by conduct that was not deliberate,
intentional or grossly negligent and for unpaid rent and may
recover from the landlord up to twice the actual damages
sustained by the tenant;
(b) A lienholder or owner aggrieved by the noncompliance may
recover from the landlord the actual damages sustained by the
lienholder or owner. ORS 90.255 does not authorize an award of
Enrolled Senate Bill 171 (SB 171-ACCA) Page 120
attorney fees to the prevailing party in any action arising under
this paragraph; and
(c) A county tax collector aggrieved by the noncompliance may
recover from the landlord the actual damages sustained by the tax
collector, if the noncompliance is part of an effort by the
landlord to defraud the tax collector. ORS 90.255 does not
authorize an award of attorney fees to the prevailing party in
any action arising under this paragraph.
(17) In the case of an abandoned recreational vehicle,
manufactured dwelling or floating home, the provisions of this
section regarding the rights and responsibilities of a tenant to
the abandoned vehicle, dwelling or home shall also apply to any
lienholder except that the lienholder shall not sell or remove
the vehicle, dwelling or home unless:
(a) The lienholder has foreclosed its lien on the recreational
vehicle, manufactured dwelling or floating home;
(b) The tenant has waived the tenant's rights under this
section pursuant to subsection (25) of this section; or
(c) The notice and response periods provided by subsections (6)
and (8) of this section have expired.
(18) In the case of an abandoned manufactured dwelling or
floating home but not including a dwelling or home abandoned
following a termination pursuant to ORS 90.429 and except as
provided by subsection (21)(d) and (e) of this section, if a
lienholder makes a timely response to a notice of abandoned
personal property and so requests, a landlord shall enter into a
written agreement with the lienholder providing that the dwelling
or home shall not be sold or disposed of by the landlord for up
to 12 months, so long as the lienholder makes timely periodic
payment of all future storage charges as provided by subsection
(7)(d) of this section and maintains the dwelling or home and the
rented space on which it is stored. The lienholder's right to
such an agreement shall arise upon the failure of the tenant,
owner or, in the case of a deceased tenant, the personal
representative, designated person, heir or devisee to remove or
sell the dwelling or home within the allotted time.
(19) During the term of an agreement described under subsection
(18) of this section, the lienholder shall have the right to
remove or sell the property, subject to the provisions of its
lien. Selling the property includes a sale to a purchaser who
wishes to leave the dwelling or home on the rented space and
become a tenant, subject to any conditions previously agreed to
by the landlord and tenant regarding the landlord's approval of a
purchaser or, if there was no such agreement, any reasonable
conditions by the landlord regarding approval of any purchaser
who wishes to leave the dwelling or home on the rented space and
become a tenant. The landlord also may condition approval for
occupancy of any purchaser of the property upon payment of all
storage charges and maintenance costs. If the lienholder violates
the agreement, the landlord may terminate it upon 90 days'
written notice stating facts sufficient to notify the lienholder
of the reason for the termination. Unless the lienholder corrects
the violation within the notice period, the agreement shall
terminate as provided and the landlord may sell or dispose of the
dwelling or home without further notice to the lienholder.
(20) Upon termination of an agreement described under
subsection (18) of this section, unless the parties otherwise
agree or the lienholder has sold or removed the manufactured
dwelling or floating home, the landlord may sell or dispose of
Enrolled Senate Bill 171 (SB 171-ACCA) Page 121
the property pursuant to this section without further notice to
the lienholder.
(21) If the personal property consists of an abandoned
manufactured dwelling or floating home and is considered
abandoned as a result of the death of a tenant who was the only
tenant and who owned the dwelling or home, the provisions of
subsections (1) to (20), (23), (24) and (26) of this section
shall apply, except as follows:
(a) The provisions of this section regarding the rights and
responsibilities of a tenant to the abandoned dwelling or home
shall apply to any personal representative named in a will or
appointed by a court to act for the deceased tenant or any person
designated in writing by the tenant to be contacted by the
landlord in the event of the tenant's death.
(b) The notice required by subsection (3) of this section shall
be:
(A) Sent by first class mail to the deceased tenant at the
premises; and
(B) Personally delivered or sent by first class mail to any
personal representative or designated person if actually known to
the landlord.
(c) The notice described in subsection (5) of this section
shall refer to any personal representative or designated person,
instead of the deceased tenant, and shall incorporate the
provisions of this subsection.
(d) If a personal representative, designated person or other
person entitled to possession of the property, such as an heir or
devisee, responds by actual notice to a landlord within the
45-day period provided by subsection (6) of this section and so
requests, the landlord shall enter into a written agreement with
the representative or person providing that the dwelling or home
shall not be sold or disposed of by the landlord for up to 90
days or until conclusion of any probate proceedings, whichever is
later, so long as the representative or person makes timely
periodic payment of all future storage charges as provided by
subsection (7)(d) of this section and maintains the dwelling or
home and the rented space on which it is stored. If such an
agreement is entered, the landlord shall not enter a similar
agreement with a lienholder pursuant to subsection (18) of this
section until the agreement with the personal representative or
designated person ends.
(e) During the term of an agreement described under paragraph
(d) of this subsection, the representative or person shall have
the right to remove or sell the dwelling or home, including a
sale to a purchaser or a transfer to an heir or devisee where the
purchaser, heir or devisee wishes to leave the dwelling or home
on the rented space and become a tenant, subject to any
conditions previously agreed to by the landlord and tenant
regarding the landlord's approval for occupancy of a purchaser,
heir or devisee or, if there was no such agreement, any
reasonable conditions by the landlord regarding approval for
occupancy of any purchaser, heir or devisee who wishes to leave
the dwelling or home on the rented space and become a tenant. The
landlord also may condition approval for occupancy of any
purchaser, heir or devisee of the dwelling or home upon payment
of all storage charges and maintenance costs. If the
representative or person violates the agreement, the landlord may
terminate it upon 30 days' written notice stating facts
sufficient to notify the representative or person of the reason
for the termination. Unless the representative or person corrects
Enrolled Senate Bill 171 (SB 171-ACCA) Page 122
the violation within the notice period, the agreement shall
terminate as provided and the landlord may sell or dispose of the
dwelling or home without further notice to the representative or
person.
(22) Upon termination of an agreement described under
subsection (21)(d) of this section, unless the parties otherwise
agree or the representative or person has sold or removed the
manufactured dwelling or floating home, the landlord may sell or
dispose of the property pursuant to this section without further
notice to the representative or person.
(23) In the case of an abandoned recreational vehicle,
manufactured dwelling or floating home that is owned by someone
other than the tenant, the provisions of this section regarding
the rights and responsibilities of a tenant to the abandoned
vehicle, dwelling or home shall also apply to that owner, with
regard only to the vehicle, dwelling or home, and not to any
goods left inside or outside the vehicle, dwelling or home.
(24) In the case of an abandoned motor vehicle, the procedure
authorized by ORS 98.830 and 98.835 for removal of abandoned
motor vehicles from private property may be used by a landlord as
an alternative to the procedures required in this section.
(25) Except for personal property that is subject to subsection
(21) of this section, a landlord may sell or dispose of a
tenant's abandoned personal property without complying with the
provisions of this section if, after termination of the tenancy
or no more than seven days prior to the termination of the
tenancy, the landlord and the tenant and, in the case of a
recreational vehicle, manufactured dwelling or floating home, any
lienholder and owner so agree in a writing entered into in good
faith. A landlord shall not, as part of a rental agreement,
require a tenant or any lienholder or owner to waive any right
provided by this section.
(26) Until personal property is conclusively presumed to be
abandoned under subsection (9) of this section, a landlord shall
not have a lien pursuant to ORS 87.152 for storing the personal
property.
SECTION 166. ORS 93.806 is amended to read:
93.806. (1) Any instrument creating a lien on unpaid rents and
profits of real property within this state, by assignment,
mortgage, pledge or otherwise, or memorandum thereof, which is
executed by the person from whom the lien is intended to be
given, and acknowledged or proved in the manner provided for the
acknowledgment or proof of other conveyances, may be indexed and
recorded in the records of mortgages of real property in the
county where such real property is located, as provided in ORS
93.710. Such recordation constitutes notice to third persons, and
shall otherwise have the same effect as recordation pursuant to
ORS 93.710, specifically, but without limitation, such lien shall
not be voidable by and shall not be subordinate to the rights of
either:
(a) A subsequent lien creditor, as defined in { - ORS 79.3010
(4) - } { + section 2 of this 2001 Act + }; or
(b) A subsequent bona fide purchaser of real property.
(2) Such an assignment, mortgage or pledge shall be so
perfected by such recording, without the holder thereof obtaining
the appointment of receiver, taking possession of the subject
real property, filing a financing statement pursuant to ORS
chapter 79 or taking any other action in addition to such
recording.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 123
(3) As used in this section, 'memorandum' has the meaning
provided in ORS 93.710 (3).
SECTION 167. ORS 95.270 is amended to read:
95.270. (1) A transfer or obligation is not voidable under ORS
95.230 (1)(a) as against a person who took in good faith and for
a reasonably equivalent value or any subsequent transferee or
obligee.
(2) Except as otherwise provided in this section, to the extent
a transfer is voidable in an action by a creditor under ORS
95.260 (1)(a), the creditor may recover judgment for the value of
the asset transferred, as adjusted under subsection (3) of this
section, or the amount necessary to satisfy the creditor's claim,
whichever is less. The judgment may be entered against:
(a) The first transferee of the asset or the person for whose
benefit the transfer was made; or
(b) Any subsequent transferee.
(3) If the judgment under subsection (2) of this section is
based upon the value of the asset transferred, the judgment must
be for an amount equal to the value of the asset at the time of
the transfer, subject to adjustment as the equities may require.
(4) A creditor may not recover under subsection (2)(b) of this
section from a good-faith transferee or obligee who took for
value or from any subsequent transferee or obligee.
(5) Notwithstanding voidability of a transfer or an obligation
under ORS 95.200 to 95.310, a good-faith transferee or obligee is
entitled, to the extent of the value given the debtor for the
transfer or obligation, to:
(a) A lien on or a right to retain any interest in the asset
transferred;
(b) Enforcement of any obligation incurred; or
(c) A reduction in the amount of the liability on the judgment.
(6) A transfer is not voidable under ORS 95.240 (2):
(a) To the extent the insider gave new value to or for the
benefit of the debtor after the transfer was made unless the new
value was secured by an otherwise unavoidable lien;
(b) If made in the ordinary course of business or financial
affairs of the debtor and the insider; or
(c) If made pursuant to a good-faith effort to rehabilitate the
debtor and the transfer secured present value given for that
purpose as well as an antecedent debt of the debtor.
(7) A transfer is not voidable under ORS 95.230 (1)(b) or
95.240 if the transfer results from:
(a) Termination of a lease upon default by the debtor when the
termination is pursuant to the terms of the lease and applicable
law; or
(b) Enforcement of a security interest in compliance with ORS
{ - 79.1010 to 79.5070 and 79.8010 - } { + chapter 79 + }.
SECTION 168. ORS 192.440 is amended to read:
192.440. (1) The custodian of any public record which a person
has a right to inspect shall give the person, on demand, a
certified copy of it, if the record is of a nature permitting
such copying, or shall furnish reasonable opportunity to inspect
or copy.
(2) If the public record is maintained in a machine readable or
electronic form, the custodian shall provide copies of the public
record in the form requested, if available. If the public record
is not available in the form requested, it shall be made
available in the form in which it is maintained.
(3) The public body may establish fees reasonably calculated to
reimburse it for its actual cost in making such records available
Enrolled Senate Bill 171 (SB 171-ACCA) Page 124
including costs for summarizing, compiling or tailoring such
record, either in organization or media, to meet the person's
request. However, when the records are those filed with the
Secretary of State under ORS chapter 79 { + or ORS 79.6020 to
79.7010 + }, the fees for furnishing copies, summaries or
compilations of such records are those established by the
Secretary of State by rule, under ORS chapter 79 { + or ORS
79.6020 to 79.7010 + }.
(4) The custodian of any public record may furnish copies
without charge or at a substantially reduced fee if the custodian
determines that the waiver or reduction of fees is in the public
interest because making the record available primarily benefits
the general public.
(5) A person who believes that there has been an unreasonable
denial of a fee waiver or fee reduction may petition the Attorney
General or the district attorney in the same manner as a person
petitions when inspection of a public record is denied under ORS
192.410 to 192.505. The Attorney General, the district attorney
and the court have the same authority in instances when a fee
waiver or reduction is denied as it has when inspection of a
public record is denied.
(6) This section does not apply to signatures of individuals
submitted under ORS chapter 247 for purposes of registering to
vote as provided in ORS 247.973.
SECTION 169. ORS 205.246 is amended to read:
205.246. (1) The county clerk shall record the following
instruments required or permitted by law to be recorded and
entered in the office of the county clerk:
(a) { - Fixture filings - } { + Financing statements + }
recorded in the office of the county clerk under { - ORS
79.3130 (1)(b) - } { + section 72 (1)(a) of this 2001 Act + };
(b) Hospital and physician liens recorded under ORS 87.565;
(c) Federal tax liens and certificates and notices affecting
federal tax liens recorded under ORS 87.806;
(d) Cooperative contracts recorded under ORS 62.360;
(e) Special district assessments attaching to real property;
(f) Lien foreclosure statements recorded under ORS 87.202;
(g) A certified copy of the judgment or a lien record abstract
or other liens affecting the title to real property;
(h) Building code exemptions required under ORS 455.320 and
455.345;
(i) Construction liens recorded under ORS 87.050;
(j) Liens upon chattels recorded under ORS 87.246;
(k) Liens on real property recorded under ORS 87.372;
(L) Employee benefit plan liens recorded under ORS 87.860;
(m) Attorney liens recorded under ORS 87.455 and 87.460;
(n) Long term care liens recorded under ORS 87.517;
(o) Ambulance services liens recorded under ORS 87.623;
(p) Agricultural producers liens recorded under ORS 87.720;
(q) Community property records recorded under ORS 108.530;
(r) Sheriff transfer of records recorded under ORS 206.100;
(s) Corrected instruments required under ORS 205.244;
(t) Mineral and mining records required under ORS 517.030,
517.052, 517.160, 517.180, 517.210, 517.220, 517.280, 517.310 and
517.320;
(u) Copies of records certified by a county clerk or court
clerk;
(v) Subdivision and partition plats recorded under ORS 92.140;
(w) Authority to solemnize marriage recorded under ORS 106.120;
and
Enrolled Senate Bill 171 (SB 171-ACCA) Page 125
(x) Condominiums recorded under ORS chapter 100.
(2) The county clerk shall charge and collect fees specified in
ORS 205.320, 205.327 and 205.350 for recording any instrument
required to be recorded under subsection (1) of this section.
(3) Indexes may be maintained for instruments recorded under
subsection (1) of this section in the same manner as provided in
ORS 205.160.
SECTION 170. ORS 283.089 is amended to read:
283.089. With the approval of the State Treasurer, the Director
of the Oregon Department of Administrative Services may:
(1) Enter into agreements with trustees to hold financing
agreement proceeds, payments and reserves as security for
lenders, and to issue certificates of participation in the right
to receive payments due from the state under a financing
agreement. Amounts held with a trustee shall be invested by the
trustee at the direction of the treasurer. Interest earned on any
investments held by a trustee as security for a financing
agreement may, at the option of the director, be credited to the
accounts held by the trustee and applied in payment of sums due
under a financing agreement.
(2) Enter into credit enhancement agreements for financing
agreements or certificates of participation, provided that such
credit enhancement agreements shall be payable solely from
available funds and amounts received from the exercise of
property rights granted under such financing agreements.
(3) Use financing agreements to finance the costs of acquiring
or refinancing property, plus the costs of reserves, credit
enhancements and costs associated with obtaining the financing.
(4) Use a single financing agreement to finance property to be
used by multiple state agencies.
(5) Subject to ORS 283.087 (2), grant leases of real property
with a trustee or lender. Such leases may be for a term which
ends on the date on which all amounts due under a financing
agreement have been paid or provision for payment has been made,
or 10 years after the last scheduled payment under a financing
agreement, whichever is later. Such leases may grant the trustee
or lender the right to evict the state and exclude it from
possession of the real property for the term of the lease if the
state fails to pay when due the amounts scheduled to be paid
under a financing agreement or otherwise defaults under a
financing agreement. Upon default, the trustee or lender may
sublease the land to third parties and apply any rentals toward
payments scheduled to be made under a financing agreement.
(6) Subject to ORS 283.087 (2), grant security interests in
personal property to trustees or lenders. Such security interests
shall attach and be perfected on the date the state takes
possession of the personal property, or the date the lender
advances money under a financing agreement, whichever is later. A
security interest authorized by this section shall have priority
over all other liens and claims. Upon default, the secured party
shall have the rights and remedies available to a secured party
under ORS { - 79.1010 to 79.5070 and 79.8010 - } { + chapter
79 + } for a first, perfected security interest in goods and
fixtures. No later than 10 days after a security interest
authorized by this section attaches, the state shall cause a
financing statement for the security interest to be filed with
the Secretary of State in the same manner as financing statements
are filed for goods; however, failure to file such a statement
shall not affect the perfection of the security interest.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 126
(7) Pledge for the benefit of trustees and lenders any amounts
which are deposited with a trustee in accordance with a financing
agreement. The pledge shall be valid and binding from the time it
is made, the amounts so pledged shall immediately be subject to
the lien of the pledge without filing, physical delivery or other
act, and the lien of the pledge shall be superior to all other
claims and liens of any kind whatsoever.
(8) Bill any state agency which benefits from property acquired
with the proceeds of a financing agreement for an appropriate
share of the financing costs, including debt service, on a
monthly or other periodic basis, and deposit payments received in
connection with such billings with a trustee as security for a
financing agreement. Any state agency receiving such a bill shall
pay the amounts billed from the first amounts legally available
to it.
(9) Purchase fire and extended coverage or other casualty
insurance for property which is acquired or refinanced with
proceeds of a financing agreement, assign the proceeds thereof to
a lender or trustee to the extent of their interest, and covenant
to maintain such insurance while the financing agreement is
unpaid, so long as available funds are sufficient to purchase
such insurance.
SECTION 171. ORS 285B.050 is amended to read:
285B.050. As used in ORS 285B.050 to 285B.098, unless the
context requires otherwise:
(1) 'Business development project' means the acquisition,
engineering, improvement, rehabilitation, construction, operation
or maintenance of any property, real or personal, that is used or
is suitable for use by an economic enterprise and that will
result in, or will aid, promote or facilitate, development of one
or more of the following activities:
(a) Manufacturing or other industrial production;
(b) Agricultural development or food processing;
(c) Aquacultural development or seafood processing;
(d) Development or improved utilization of natural resources;
(e) Convention facilities and trade centers;
(f) Transportation or freight facilities; and
(g) Other activities that represent new technology or type of
economic enterprise the Oregon Economic and Community Development
Commission determines is needed to diversify the economic base of
an area but not including:
(A) Construction of office buildings, including corporate
headquarters; and
(B) Retail businesses, shopping centers or food service
facilities.
(2) 'Commission' means the Oregon Economic and Community
Development Commission established under ORS 285A.040.
(3) 'Fund' means the Oregon Business Development Fund.
(4) 'Collateral' { - means - } { + has the meaning given
that term in section 2 of this 2001 Act for + } property subject
to a security interest { - , as defined in ORS 79.1050 - } .
(5) 'Municipality' means any city, municipal corporation or
quasi-municipal corporation.
(6) 'Person' means any individual, association of individuals,
joint venture, partnership or corporation.
(7) 'Local development group' means any public or private
corporation which has as one of its primary purposes, as stated
in its articles of incorporation, charter or bylaws, the
promotion of economic development in any part of the State of
Oregon.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 127
(8) 'Applicant' means any county, municipality, person or any
combination of counties, municipalities or persons applying for a
loan from the Oregon Business Development Fund under ORS 285B.050
to 285B.098.
(9) 'Owned and operated by women and minorities' means, with
regard to any specific business enterprise, the ownership or
control of more than 50 percent of the units of proprietary or
ownership interest in that business enterprise by individuals who
are women or members of minorities, as defined by ORS 430.347
(2).
(10) 'Emerging small business' has the meaning given that term
by ORS 200.005.
(11) 'County' means any county or federally recognized Oregon
Indian tribe.
SECTION 172. ORS 305.182 is amended to read:
305.182. (1) The Department of Revenue may file warrants issued
against any taxpayer for unpaid taxes in the Office of the
Secretary of State as provided in this section.
(2) Certification of warrants for unpaid taxes by the Director
of the Department of Revenue, or the representative of the
director, entitles the warrants to be filed and no other
certification or acknowledgment is necessary.
(3) If a warrant described in subsection (1) of this section is
presented to the Secretary of State for filing, the Secretary of
State shall cause the warrant to be marked, held and indexed in
accordance with the provisions of { - ORS 79.4030 (4) - }
{ + section 90 of this 2001 Act + } as if the warrant were a
financing statement within the meaning of ORS { - 79.1010 to
79.7010 - } { + chapter 79 + }.
(4) If a certificate of release, cancellation or satisfaction
of any warrant is presented to the Secretary of State for filing,
the Secretary of State shall:
(a) Cause a certificate of release to be marked, held and
indexed as if the certificate were a termination statement within
the meaning of { - ORS 79.4040 - } { + section 83 of this
2001 Act + }.
(b) Cause a certificate of cancellation or satisfaction to be
held, marked and indexed as if the certificate were a release of
collateral within the meaning of { - ORS 79.4060 - } { +
section 83 of this 2001 Act + }.
SECTION 173. ORS 305.184 is amended to read:
305.184. (1) Upon request of any person, the Secretary of State
shall issue a certificate showing whether there is on file in the
Office of the Secretary of State, on the date and hour stated
therein, any warrant described in ORS 305.182 (1), or certificate
or notice affecting any warrant naming a particular person, and
if a notice or certificate is on file, giving the date and hour
of its filing. All financing statements and statements of
assignment, if any, filed pursuant to ORS { - 79.1010 to
79.7010 - } { + chapter 79 + } for a particular debtor whose
name is identical to the particular person named in the warrant
shall be shown on this certificate. The uniform fee for such a
certificate for a particular person shall be prescribed by the
Secretary of State by rule. If the request for the certificate is
in writing and not in the standard form prescribed by the
Secretary of State, an additional fee shall be prescribed. Upon
request, the Secretary of State shall furnish a copy of any
warrant or notice or certificate affecting a warrant for a fee
per page, the fee to be as prescribed by the Secretary of State
by rule. No fee prescribed under this subsection shall exceed $5.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 128
(2) Notwithstanding the provisions of { - ORS 79.4030,
79.4060, 79.4070 - } { + section 96 of this 2001 Act + } or
subsection (1) of this section, relating to the time and manner
of the payment of fees to the Secretary of State, the fee for
filing and indexing each warrant described in ORS 305.182 (1)
shall be charged and collected in the same manner as provided in
ORS 205.395 for payment by a state agency of fees due to the
county clerk for recording warrants.
SECTION 174. ORS 353.380 is amended to read:
353.380. As used in ORS 353.380 to 353.420:
(1) 'Credit enhancement agreement' means any agreement or
contractual relationship between the Oregon Health Sciences
University and any bank, trust company, insurance company, surety
bonding company, pension fund or other financial institution
providing additional credit on or security for a financing
agreement or certificates of participation authorized by ORS
353.380 to 353.420.
(2) 'Financing agreement' means a lease-purchase agreement, an
installment sale agreement, a loan agreement, note agreement,
short-term promissory notes, commercial papers, lines of credit
or similar obligations or any other agreement to finance real or
personal property that is or will be owned and operated by the
university, or to refinance previously executed financing
agreements.
(3) 'Personal property' means tangible personal property,
software and fixtures.
(4) 'Property rights' means, with respect to personal property,
the rights of a secured party under ORS { - 79.1010 to 79.5070
and 79.8010 - } { + chapter 79 + }, and, with respect to real
property, the rights of a trustee or lender under a lease
authorized by ORS 353.410 (4).
(5) 'Software' means software and training and maintenance
contracts related to the operation of computing equipment.
SECTION 175. ORS 471.292, as amended by section 48, chapter
351, Oregon Laws 1999, is amended to read:
471.292. (1) A license granted under the Liquor Control Act or
the Oregon Distilled Liquor Control Act shall:
(a) Be a purely personal privilege.
(b) Be valid for the period stated in the license.
(c) Be renewable in the manner provided in ORS 471.311, except
for a cause which would be grounds for refusal to issue such
license under ORS 471.313.
(d) Be revocable or suspendible as provided in ORS 471.315.
(e) Be transferable from the place for which the license was
originally issued to another location subject to the provisions
of the Liquor Control Act, the Oregon Distilled Liquor Control
Act, any rules of the Oregon Liquor Control Commission and any
municipal ordinance or local regulation.
(f) Cease upon the death of the licensee, except as provided in
subsection (2) of this section.
(g) Not constitute property.
(h) Not be alienable.
(i) Not be subject to attachment or execution.
(j) Not descend by the laws of testate or intestate devolution.
(2) The commission may, by order, provide for the manner and
conditions under which:
(a) Alcoholic liquors left by any deceased, insolvent or
bankrupt person or licensee, or subject to a security interest,
may be foreclosed, sold under execution or otherwise disposed of.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 129
(b) The business of any deceased, insolvent or bankrupt
licensee may be operated for a reasonable period following the
death, insolvency or bankruptcy.
(c) A business licensed pursuant to this chapter subject to a
security interest may be continued in business by a secured party
as defined in { - ORS 79.1050 - } { + section 2 of this 2001
Act + } for a reasonable period after default on the indebtedness
by the debtor.
(d) A license granted under this chapter may be transferred
from the place for which the license was originally issued to
another location.
SECTION 176. ORS 547.510 is amended to read:
547.510. (1) A claim for lien substantially in the following
form shall be sufficient:
_________________________________________________________________
NOTICE OF LIEN UPON CROPS
Notice is given that ___, a drainage district organized under
and pursuant to the provisions of ORS chapter 547, claims a lien
upon that certain crop of ___ growing on the following described
lands located in the drainage district in ___ County, Oregon:
___, for that portion of the annual charges or assessments levied
by the above-named drainage district against lands, or owners or
occupants of the lands, on which the crop is growing, for
maintenance and operation of the district, in the sum of $__;
that the name of the owner or reputed owner of the crop is ___;
that the owner of the land on which the crop is growing is ___;
that no part of the charge or assessment for which a lien herein
is claimed has been paid, except $__; and that there now is due
and remaining unpaid thereon, after deducting all just credits
and offsets, the sum of $__.
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
________
, Claimant.
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
State of Or)gon,
) ss.
County )
of ____
)
____________________________________________________________
END OF POSSIBLE IRREGULAR TABULAR TEXT
____________________________________________________________
I, ________, being first duly sworn, on oath say that I am
___ of the drainage district named in the foregoing claim, that I
have personal knowledge of the facts therein set out; that I know
the contents thereof, and believe the same to be true.
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 130
_______________________________________________________________
________
____________________________________________________________
END OF POSSIBLE IRREGULAR TABULAR TEXT
____________________________________________________________
Subscribed and sworn to before me this __ day of ___, 2__.
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
________
Notary Public for Oregon
(SMylcommission expires _____
.
_________________________________________________________________
____________________________________________________________
END OF POSSIBLE IRREGULAR TABULAR TEXT
____________________________________________________________
(2) The lien so created may be foreclosed in the manner
provided in { - ORS 79.5010 to 79.5070 - } { + sections 99 to
126 of this 2001 Act + }.
SECTION 177. ORS 646.551 is amended to read:
646.551. As used in ORS 646.551 to 646.557, unless the context
requires otherwise:
(1) 'Telephonic seller' means a person who, on the person's own
behalf, or on behalf of another person, causes or attempts to
cause a telephone solicitation to be made under the following
circumstances:
(a) The person initiates telephonic contact with a prospective
purchaser and represents or implies any of the following:
(A) That a prospective purchaser who buys one or more goods or
services unit will receive additional units, whether or not of
the same type as purchased, without further cost. As used in this
subparagraph, 'further cost' does not include actual postage or
common carrier delivery charges, if any;
(B) That a prospective purchaser will receive a prize or gift
if the person also encourages the prospective purchaser to do
either of the following:
(i) Purchase or rent any goods or services; or
(ii) Pay any money, including, but not limited to a delivery or
handling charge;
(C) That a prospective purchaser who buys goods or services,
because of some unusual event or imminent price increase, will be
able to buy these items at prices which are below those usually
charged or will be charged for those items;
(D) That the seller is a person other than the actual seller;
(E) That the items for sale or rent are manufactured or
supplied by a person other than the actual manufacturer or
supplier; or
(F) That the items for sale are gold, silver or other precious
metals, diamonds, rubies, sapphires or other precious stones or
any interest in oil, gas or mineral fields, wells or exploration
sites; or
(b) The telephone solicitation is made by the person in
response to inquiries from prospective purchasers generated by
Enrolled Senate Bill 171 (SB 171-ACCA) Page 131
advertisement, on behalf of the person and the solicitation is
conducted as described in paragraph (a) of this subsection.
(2) 'Telephonic seller' does not include any of the following:
(a) A person selling a security as defined in ORS 59.015, or
securities which are exempt under ORS 59.025.
(b) A person licensed pursuant to ORS chapter 696 when the
transaction is governed by that chapter.
(c) A person licensed pursuant to ORS 701.055 when the
solicited transaction is governed by ORS chapter 701.
(d) A person licensed pursuant to ORS chapter 744 when the
solicited transaction is governed by the Insurance Code.
(e) A person soliciting the sale of a franchise when the
solicited transaction is governed by ORS 650.005 to 650.085.
(f) A person primarily soliciting the sale of a subscription to
or advertising in a newspaper of general circulation.
(g) A person primarily soliciting the sale of a magazine or
periodical, or contractual plans, including book or record clubs:
(A) Under which the seller provides the consumer with a form
which the consumer may use to instruct the seller not to ship the
offered merchandise, and which is regulated by the Federal Trade
Commission trade regulation concerning 'Use of Negative Option
Plans by Sellers in Commerce'; or
(B) Using arrangements such as continuity plans, subscription
arrangements, standing order arrangements, supplements and series
arrangements under which the seller periodically ships
merchandise to a consumer who has consented in advance to receive
such merchandise on a periodic basis.
(h) A person soliciting business from prospective purchasers
who have previously purchased from the business enterprise for
which the person is calling.
(i) A person soliciting without the intent to complete and who
does not complete the sales presentation during the telephone
solicitation and who only completes the sale presentation at a
later face-to-face meeting between the solicitor and the
prospective purchaser, unless at that later meeting the solicitor
collects or attempts to collect payment for delivery of items
purchased.
(j) Any supervised financial institution or parent, subsidiary,
or affiliate thereof. As used in this paragraph, ' supervised
financial institution' means any financial institution or trust
company, as those terms are defined in ORS 706.008, or any
personal property broker, consumer finance lender, commercial
finance lender or insurer that is subject to regulation by an
official or agency of this state or the United States.
(k) A person soliciting the sale of funeral or burial services
regulated by ORS 59.670 and 59.680 or by ORS chapter 692.
(L) A person soliciting the sale of services provided by a
cable television system operating under authority of a franchise
or permit issued by a governmental agency of this state, or
subdivision thereof.
(m) A person or affiliate of a person whose business is
regulated by the Public Utility Commission, or a
telecommunications utility with access lines of 15,000 or less or
a cooperative telephone association.
(n) A person soliciting the sale of a farm product, as defined
in { - ORS 79.1090 (3) - } { + section 2 of this 2001
Act + }, if the solicitation does not result in a sale which
costs the purchaser in excess of $100.
(o) An issuer or a subsidiary of an issuer that has a class of
securities that is subject to section 12 of the Securities
Enrolled Senate Bill 171 (SB 171-ACCA) Page 132
Exchange Act of 1934 and that is either registered or exempt from
registration under paragraph (A), (B), (C), (E), (F), (G) or (H)
of subsection (g) of that section.
(p) A person soliciting exclusively the sale of telephone
answering services to be provided by that person or that person's
employer.
(q) A person registered under the Charitable Solicitations Act.
SECTION 178. ORS 657.394 is amended to read:
657.394. (1) Any warrant attaching the lien under ORS 657.392
may also be filed in the office of the Secretary of State. Filing
in the office of the Secretary of State shall have no effect
until a copy of the statement of lien or the warrant has been
recorded with the county clerk.
(2) When a copy of the statement of lien or the warrant is
filed with the Secretary of State in compliance with subsection
(1) of this section, such filing shall have the same effect with
respect to personal property as if the copy of the statement of
lien or the warrant had been duly recorded with the county clerk
in each county of this state.
(3) A copy of the statement of lien or the warrant so filed
with the Secretary of State shall be filed and indexed by the
Secretary of State in the same manner as is provided in { - ORS
79.4010 - } { + section 72 of this 2001 Act + } for the filing
and indexing of financing statements.
SECTION 179. ORS 657.542 is amended to read:
657.542. (1) A copy of any statement of lien filed as provided
in ORS 657.535 or any warrant attaching the lien of ORS 657.540
may also be filed in the office of the Secretary of State.
Filing in the office of the Secretary of State shall have no
effect until a copy of the statement of lien or a warrant has
been recorded with a county clerk.
(2) When a copy of the statement of lien or the warrant is
filed with the Secretary of State in compliance with subsection
(1) of this section, such filing shall have the same effect with
respect to personal property as if the copy of the statement of
lien or the warrant had been duly recorded with the county clerk
in each county of this state.
(3) A copy of the statement of lien or the warrant so filed
with the Secretary of State shall be filed and indexed by the
Secretary of State in the same manner as is provided in { - ORS
79.4010 - } { + section 72 of this 2001 Act + } for the filing
and indexing of financing statements.
SECTION 180. ORS 708A.535 is amended to read:
708A.535. (1) An institution may only grant security interests
in its assets:
(a) To secure its indebtedness to a Federal Reserve Bank or
Federal Home Loan Bank.
(b) To secure its borrowings from others with a maturity of 90
days or less, provided the value of the assets pledged shall not
be more than 50 percent greater than the amount borrowed. If the
value of the assets pledged is more than 25 percent greater than
the amount borrowed or if the amount borrowed is greater than the
stockholders' equity of the bank, the transaction shall first be
approved in writing by the Director of the Department of Consumer
and Business Services.
(c) To secure its deposits that are not insured by the Federal
Deposit Insurance Corporation provided:
(A) The value of aggregate assets pledged does not exceed 20
percent of its stockholders' equity; and
(B) The prior written approval of the director is obtained.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 133
(d) To secure public funds, trust funds awaiting investment or
distribution, or trust funds deposited with it by an institution.
(2) Notwithstanding any other provision of state law, when an
institution grants a security interest in assets to secure public
funds, the depositor of the public funds and any bailee of
pledged securities or other assets shall be entitled to the
status of a lien creditor as defined in { - ORS 79.3010 (3) - }
{ + section 2 of this 2001 Act + }.
(3) An institution shall grant a security interest in its
assets only when authorized by a general or specific prior
resolution or its board of directors.
(4) As used in this section, 'public funds' means deposits
belonging to:
(a) The State of Oregon that may be deposited to the official
credit of the State Treasurer, and funds that may be deposited in
an official capacity by any state officer, board or commission.
(b) Any county within this state deposited to the official
credit of the county treasurer, including the funds of any
irrigation or drainage district organized under the laws of this
state, or any school district within this state where funds of
the school district are deposited with the county treasurer, and
funds that may be deposited in an official capacity by any county
officer.
(c) Any port, port commission, dock or dock commission within
this state that may be deposited to the credit of the port, port
commission, dock or dock commission, or the treasurer thereof.
(d) Any city within this state deposited to the official credit
of the city treasurer, and funds that may be deposited in an
official capacity by any officer of any municipal corporation.
(e) Any school district within this state.
(f) Any district organized under the laws of this state with
the power to levy taxes.
(g) Any housing authority organized and operating pursuant to
ORS 456.055 to 456.235.
(h) The United States and any of its agencies and
instrumentalities to be deposited in the manner and under the
rules prescribed by the United States Government.
SECTION 181. ORS 722.264 is amended to read:
722.264. (1) Personal representatives, trustees and other
fiduciaries; banks, trust companies, credit unions and similar
financial organizations; charitable, educational and eleemosynary
corporations, funds and organizations; and municipal and other
public corporations and public officials may invest funds held by
them, without any order of any court, in savings accounts of
savings associations and federal associations. Such investments
shall be considered legal investments.
(2) A savings association may pledge its assets to secure
public funds as provided under ORS chapter 295. For the purposes
of this section, 'public funds' has the meaning given that term
by ORS 295.005.
(3) When a deposit of securities or a bond with security is
required for any purpose under the laws of this state or
otherwise, a savings account of an association or federal
association is acceptable for such a deposit or security.
(4) This section is supplemental to other laws relating to
legal investments and to the deposit of securities and the filing
of bonds for any purpose.
(5) Notwithstanding any other provision of law, when a savings
association or federal association pledges securities or any
other assets to secure public funds, the custodian of such public
Enrolled Senate Bill 171 (SB 171-ACCA) Page 134
funds shall be a lien creditor, as defined in { - ORS
79.3010 - } { + section 2 of this 2001 Act + }, with respect to
the securities or assets which have been pledged to secure such
funds.
SECTION 182. ORS 725.360 is amended to read:
725.360. Every licensee shall:
(1) Deliver to the borrower at the time any loan is made a
statement in the English language showing in clear and distinct
terms:
(a) The name and address of the borrower and of the licensee.
(b) The amount and the date of the loan and of its maturity or
terms of payment.
(c) The rate of interest agreed upon or consideration to be
charged therefor.
(d) The nature of the security for the loan, if a lien on
personal property has been taken by chattel mortgage, bill of
sale, collateral agreement or otherwise.
(2) Make available to the borrower upon request a plain and
complete receipt for all payments made on account of any such
loan at the time such payments are received by the licensee,
specifying the amount applied to interest, if any, the date to
which the interest is paid, the amount applied to principal, if
any, and the unpaid principal balance of such loan, if any
remains.
(3) Permit payment to be made in advance in any amount on any
loan at any time.
(4) Upon repayment of the loan in full or upon renewal thereof,
mark indelibly such obligation signed by the borrower with the
word 'Paid' or 'Renewed.' In the case of repayment in full the
licensee also shall do the following:
(a) To the extent and in the manner required by law, release
any mortgage or security agreement that no longer secures a loan,
and restore any security or collateral.
(b) Release any Uniform Commercial Code filing that no longer
secures a loan, to the extent and in the manner required by
{ - ORS 79.4040 - } { + section 84 of this 2001 Act + }.
(c) Return any assignment given by the borrower.
(d) Return to the borrower the canceled note evidencing the
loan or alternatively, acknowledge in writing to the borrower
that the loan has been repaid.
SECTION 183. ORS 803.015 is amended to read:
803.015. The Department of Transportation shall design a
certificate of title for vehicles for situations in which the
department determines that certificates will be issued. A
certificate of title issued by the department shall conform to
all of the following:
(1) The certificate shall be numbered in a manner prescribed by
the department.
(2) The certificate shall contain a description of the vehicle.
(3) The certificate shall contain evidence of identification of
the vehicle the department deems proper.
(4) The certificate shall contain the name of the owner of the
vehicle.
(5) The certificate shall identify any security interest
holders in the order of their priority. This subsection does not
apply to the security interests where the debtor who granted the
security interest is in the business of selling vehicles and the
vehicle constitutes inventory held for sale { + or lease + }.
(6) The certificate shall identify any lessor of the vehicle.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 135
(7) The certificate shall be authenticated by a seal of the
State of Oregon printed on the certificate.
(8) The certificate shall have space to fill in information
required by the department upon the transfer of a vehicle under
ORS 803.094 and space for the odometer disclosure required on
transfer of an interest under ORS 803.102.
(9) If the vehicle is a reconstructed vehicle, the certificate
shall:
(a) Show the original year model and make of the vehicle.
(b) Indicate that the vehicle is reconstructed. A certificate
of title shall not indicate that a vehicle is reconstructed as
otherwise required by this paragraph if the reconstructed vehicle
is an antique vehicle.
(10) If the vehicle is an assembled vehicle, the certificate
shall:
(a) Show the make of the vehicle as 'assembled. '
(b) Show the year the building of the vehicle is completed as
the year model of the vehicle.
(11) The certificate shall show the mileage of the vehicle as
reported to the department at the time the most recent title
transfer was reported to the department, or the mileage reported
to the department at the time the vehicle was initially titled in
Oregon, whichever occurred last. The information required by this
subsection shall be shown as reported to the department on
odometer disclosure reports required by law to be submitted to
the department.
(12) If the vehicle is a replica, the certificate shall
indicate that the vehicle is a replica.
(13) The certificate shall contain a notation that a vehicle
has been damaged if the vehicle is from another jurisdiction and:
(a) The title from the other jurisdiction carries a brand or
notation that indicates that the vehicle was damaged, destroyed,
salvaged or words of similar import, whether or not the
definitions of such terms in the other jurisdiction are in accord
with the definitions of those words in Oregon; or
(b) The department receives a salvage title, salvage
certificate, wrecker's bill of sale or similar document or
information that indicates the vehicle has been damaged.
(14) The department shall adopt rules covering the content and
circumstances under which the notation provided for in subsection
(13) of this section is used.
(15) The department may omit the notation or remove the
notation provided for in subsection (13) of this section if:
(a) The department is provided with information from the
originating jurisdiction that indicates that its title
incorrectly reflects a brand or notation;
(b) The department is provided with information from the
originating jurisdiction indicating that jurisdiction would not
identify the vehicle as damaged; or
(c) The department is satisfied the notation was placed on an
Oregon title in error.
(16) Notwithstanding subsection (15) of this section, if the
department determines the vehicle in question meets Oregon
requirements for assembled or reconstructed vehicles or replicas,
the department shall title the vehicle in accordance with
requirements for those vehicles.
(17) If the vehicle has been reported to the department as a
totaled vehicle under the provisions of ORS 819.012 or 819.014,
the certificate shall contain the word 'totaled' unless the
Enrolled Senate Bill 171 (SB 171-ACCA) Page 136
reason for the report was theft and the vehicle has been
recovered.
(18) The certificate shall contain any other information
required by the department.
(19) The certificate shall be produced by a secure process that
meets or exceeds the requirements of federal law.
SECTION 184. ORS 803.097 is amended to read:
803.097. (1) Except as provided in subsection { - (4) - }
{ + (5) + } of this section, the exclusive means for perfecting
a security interest in a vehicle is by application for notation
of the security interest on the title in accordance with this
section. The application may accompany the application for a
title or may be made separately at any time prior to issuance of
title and must be accompanied by evidence of ownership as defined
by the Department of Transportation by rule unless the department
is in possession of evidence of ownership when it receives the
application. If title to the vehicle has been issued in a form
other than a certificate, and the title reflects a security
interest, the application for perfection shall include
authorization from the previous security interest holder for the
new security interest to be recorded on the title. Authorization
under this subsection is not required if:
(a) A release of interest is submitted by the prior security
interest holder or the department is otherwise satisfied that the
prior holder no longer holds an interest or is otherwise not
entitled to title to the vehicle;
(b) The security interest is being added to the title in
conjunction with the cancellation of previous title or other
action the department takes to correct ownership information
reflected on a title; or
(c) Title is being transferred by operation of law.
(2) When the department processes an application for a security
interest the department shall mark on the application or
otherwise indicate on the record the date the application was
first received by the department. The department shall determine
by rule what constitutes receipt of an application for purposes
of this subsection.
(3) If the department has the evidence required by subsection
(1) of this section and if the application contains the name of
each owner of the vehicle, the name and address of the secured
party and the vehicle identification number of the collateral,
the security interest is perfected as of the date marked on the
application or indicated in the record by the department. If the
application does not contain the information required by this
subsection, or if the department does not have the required
evidence, the department shall indicate on the application or on
the record that the date placed on the application or the record
pursuant to subsection (2) of this section is not the date of
perfection of the security interest.
{ + (4) The security interest remains effective until
released or terminated by the secured party. + }
{ - (4) - } { + (5) + } A security interest in a vehicle
may not be perfected as described under this section but is
subject to the perfection provisions under ORS chapter 79 if the
debtor who granted the security interest is in the business of
selling vehicles and the vehicle constitutes inventory held for
sale { + or lease + }.
SECTION 185. ORS 830.740 is amended to read:
830.740. (1) Except as provided in subsection (2) of this
section, the exclusive means of perfecting a security interest in
Enrolled Senate Bill 171 (SB 171-ACCA) Page 137
a boat, boathouse or floating home covered by a certificate of
title is by application for and notation of the security interest
on the certificate of title in accordance with the provisions of
ORS 830.720, 830.740 to 830.755, 830.785, 830.810, 830.850 and
830.855. { + The security interest remains effective until
released or terminated by the secured party. + }
(2) A security interest may not be perfected by notation of the
security interest on the certificate of title if the debtor who
granted the security interest is in the business of selling
boats, boathouses or floating homes, and the boat, boathouse or
floating home constitutes inventory held for sale { + or lease
or the boat, boathouse or floating home is leased by the debtor
as lessor + }. The filing provisions of { - ORS 79.4010 to
79.4070 - } { + sections 72 to 98 of this 2001 Act + } shall
apply to security interests in such boats, boathouses or floating
homes.
(3) The rights and remedies of all persons in boats, boathouses
and floating homes covered by this section shall be determined by
the provisions of the Uniform Commercial Code.
SECTION 186. ORCP 81 A is amended to read:
A Definitions. As used in Rules 81 through 85, unless the
context otherwise requires:
A(1) Attachment. 'Attachment' is the procedure by which an
unsecured plaintiff obtains a judicial lien on defendant's
property prior to judgment.
A(2) Bank. 'Bank' includes commercial and savings banks, trust
companies, savings and loan associations, and credit unions.
A(3) Clerk. 'Clerk' means clerk of the court or any person
performing the duties of that office.
A(4) Consumer goods. 'Consumer goods' means consumer goods as
defined in { - ORS 79.1090 - } { + section 2 of this 2001
Act + }.
A(5) Consumer transaction. 'Consumer transaction' means a
transaction in which the defendant becomes obligated to pay for
goods sold or leased, services rendered, or monies loaned,
primarily for purposes of the defendant's personal, family, or
household use.
A(6) Issuing officer. 'Issuing officer' means any person who on
behalf of the court is authorized to issue provisional process.
A(7) Levy. 'Levy' means to create a lien upon property prior to
judgment by any of the procedures provided by Rules 81 through 85
that create a lien.
A(8) Plaintiff and defendant. 'Plaintiff' includes any party
asserting a claim for relief whether by way of claim, third party
claim, cross-claim, or counterclaim, and 'defendant ' includes
any person against whom such claim is asserted.
A(9) Provisional process. 'Provisional process' means
attachment under Rule 84, claim and delivery under Rule 85,
temporary restraining orders under Rule 83, preliminary
injunctions under Rule 83, or any other legal or equitable
judicial process or remedy which before final judgment enables a
plaintiff, or the court on behalf of the plaintiff, to take
possession or control of, or to restrain use or disposition of,
or fix a lien on property in which the defendant claims an
interest, except an order appointing a provisional receiver under
Rule 80 or granting a temporary restraining order or preliminary
injunction under Rule 79.
A(10) Security interest. 'Security interest' means a lien
created by agreement, as opposed to a judicial or statutory lien.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 138
A(11) Sheriff. 'Sheriff' includes a constable of a justice
court.
A(12) Writ. A 'writ' is an order by a court to a sheriff or
other official to aid a creditor in attachment.
SECTION 187. { + ORS 79.1010, 79.1020, 79.1030, 79.1040,
79.1050, 79.1060, 79.1070, 79.1080, 79.1090, 79.1100, 79.1120,
79.1130, 79.1150, 79.1160, 79.2010, 79.2020, 79.2030, 79.2040,
79.2050, 79.2060, 79.2070, 79.2080, 79.3010, 79.3015, 79.3020,
79.3030, 79.3040, 79.3050, 79.3060, 79.3070, 79.3080, 79.3090,
79.3100, 79.3110, 79.3120, 79.3130, 79.3132, 79.3140, 79.3150,
79.3160, 79.3170, 79.3180, 79.4010, 79.4016, 79.4020, 79.4023,
79.4025, 79.4030, 79.4040, 79.4050, 79.4060, 79.4070, 79.4080,
79.4090, 79.5010, 79.5020, 79.5030, 79.5040, 79.5050, 79.5060 and
79.5070 are repealed. + }
{ +
TRANSITION + }
SECTION 188. { + 9-702. Savings clause. (1) Pre-effective-date
transactions or liens. Except as otherwise provided in this
section and sections 189 to 195 of this 2001 Act, sections 1 to
128, 147, 148, 158 and 188 to 195 of this 2001 Act, the
amendments to statutes by sections 129 to 146, 149 to 157 and 159
to 185 of this 2001 Act, the amendments to ORCP 81 A by section
186 of this 2001 Act and the repeal of statutes by section 187 of
this 2001 Act apply to a transaction or lien within its scope,
even if the transaction or lien was entered into or created
before the effective date of this 2001 Act.
(2) Continuing validity. Except as otherwise provided in
subsection (3) of this section and sections 189 to 195 of this
2001 Act:
(a) Transactions and liens that were not governed by ORS
79.1010 to 79.5070 and 79.8010 (1999 Edition), were validly
entered into or created before the effective date of this 2001
Act, and would be subject to sections 1 to 128, 147, 148, 158 and
188 to 195 of this 2001 Act, the amendments to statutes by
sections 129 to 146, 149 to 157 and 159 to 185 of this 2001 Act,
the amendments to ORCP 81 A by section 186 of this 2001 Act and
the repeal of statutes by section 187 of this 2001 Act if they
had been entered into or created after the effective date of this
2001 Act, and the rights, duties and interests flowing from those
transactions and liens, remain valid after the effective date of
this 2001 Act; and
(b) The transactions and liens may be terminated, completed,
consummated and enforced as required or permitted by sections 1
to 128, 147, 148, 158 and 188 to 195 of this 2001 Act, the
amendments to statutes by sections 129 to 146, 149 to 157 and 159
to 185 of this 2001 Act, the amendments to ORCP 81 A by section
186 of this 2001 Act and the repeal of statutes by section 187 of
this 2001 Act or by the law that otherwise would apply if
sections 1 to 128, 147, 148, 158 and 188 to 195 of this 2001 Act,
the amendments to statutes by sections 129 to 146, 149 to 157 and
159 to 185 of this 2001 Act, the amendments to ORCP 81 A by
section 186 of this 2001 Act and the repeal of statutes by
section 187 of this 2001 Act had not taken effect.
(3) Pre-effective-date proceedings. Sections 1 to 128, 147,
148, 158 and 188 to 195 of this 2001 Act, the amendments to
statutes by sections 129 to 146, 149 to 157 and 159 to 185 of
this 2001 Act, the amendments to ORCP 81 A by section 186 of this
2001 Act and the repeal of statutes by section 187 of this 2001
Enrolled Senate Bill 171 (SB 171-ACCA) Page 139
Act do not affect an action, case or proceeding commenced before
the effective date of this 2001 Act. + }
SECTION 189. { + 9-703. Security interest perfected before
effective date. (1) Continuing priority over lien creditor:
Perfection requirements satisfied. A security interest that is
enforceable immediately before the effective date of this 2001
Act and would have priority over the rights of a person that
becomes a lien creditor at that time is a perfected security
interest under sections 1 to 128, 147, 148, 158 and 188 to 195 of
this 2001 Act, the amendments to statutes by sections 129 to 146,
149 to 157 and 159 to 185 of this 2001 Act, the amendments to
ORCP 81 A by section 186 of this 2001 Act and the repeal of
statutes by section 187 of this 2001 Act if, on the effective
date of this 2001 Act, the applicable requirements for
enforceability and perfection under sections 1 to 128, 147, 148,
158 and 188 to 195 of this 2001 Act, the amendments to statutes
by sections 129 to 146, 149 to 157 and 159 to 185 of this 2001
Act, the amendments to ORCP 81 A by section 186 of this 2001 Act
and the repeal of statutes by section 187 of this 2001 Act are
satisfied without further action.
(2) Continuing priority over lien creditor: Perfection
requirements not satisfied. Except as otherwise provided in
section 191 of this 2001 Act, if, immediately before the
effective date of this 2001 Act, a security interest is
enforceable and would have priority over the rights of a person
that becomes a lien creditor at that time, but the applicable
requirements for enforceability or perfection under sections 1 to
128, 147, 148, 158 and 188 to 195 of this 2001 Act, the
amendments to statutes by sections 129 to 146, 149 to 157 and 159
to 185 of this 2001 Act, the amendments to ORCP 81 A by section
186 of this 2001 Act and the repeal of statutes by section 187 of
this 2001 Act are not satisfied on the effective date of this
2001 Act, the security interest:
(a) Is a perfected security interest for one year after the
effective date of this 2001 Act;
(b) Remains enforceable thereafter only if the security
interest becomes enforceable under section 13 of this 2001 Act
before the year expires; and
(c) Remains perfected thereafter only if the applicable
requirements for perfection under sections 1 to 128, 147, 148,
158 and 188 to 195 of this 2001 Act, the amendments to statutes
by sections 129 to 146, 149 to 157 and 159 to 185 of this 2001
Act, the amendments to ORCP 81 A by section 186 of this 2001 Act
and the repeal of statutes by section 187 of this 2001 Act are
satisfied before the year expires. + }
SECTION 190. { + 9-704. Security interest unperfected before
effective date. A security interest that is enforceable
immediately before the effective date of this 2001 Act but would
be subordinate to the rights of a person that becomes a lien
creditor at that time:
(1) Remains an enforceable security interest for one year after
the effective date of this 2001 Act;
(2) Remains enforceable thereafter if the security interest
becomes enforceable under section 13 of this 2001 Act on the
effective date of this 2001 Act or within one year thereafter;
and
(3) Becomes perfected:
(a) Without further action, on the effective date of this 2001
Act if the applicable requirements for perfection under sections
1 to 128, 147, 148, 158 and 188 to 195 of this 2001 Act, the
Enrolled Senate Bill 171 (SB 171-ACCA) Page 140
amendments to statutes by sections 129 to 146, 149 to 157 and 159
to 185 of this 2001 Act, the amendments to ORCP 81 A by section
186 of this 2001 Act and the repeal of statutes by section 187 of
this 2001 Act are satisfied before or at that time; or
(b) When the applicable requirements for perfection are
satisfied if the requirements are satisfied after that time. + }
SECTION 191. { + 9-705. Effectiveness of action taken before
effective date. (1) Pre-effective-date action; one-year
perfection period unless reperfected. If action, other than the
filing of a financing statement, is taken before the effective
date of this 2001 Act and the action would have resulted in
priority of a security interest over the rights of a person that
becomes a lien creditor had the security interest become
enforceable before the effective date of this 2001 Act, the
action is effective to perfect a security interest that attaches
under sections 1 to 128, 147, 148, 158 and 188 to 195 of this
2001 Act, the amendments to statutes by sections 129 to 146, 149
to 157 and 159 to 185 of this 2001 Act, the amendments to ORCP 81
A by section 186 of this 2001 Act and the repeal of statutes by
section 187 of this 2001 Act within one year after the effective
date of this 2001 Act. An attached security interest becomes
unperfected one year after the effective date of this 2001 Act
unless the security interest becomes a perfected security
interest under sections 1 to 128, 147, 148, 158 and 188 to 195 of
this 2001 Act, the amendments to statutes by sections 129 to 146,
149 to 157 and 159 to 185 of this 2001 Act, the amendments to
ORCP 81 A by section 186 of this 2001 Act and the repeal of
statutes by section 187 of this 2001 Act before the expiration of
that period.
(2) Pre-effective-date filing. The filing of a financing
statement before the effective date of this 2001 Act is effective
to perfect a security interest to the extent the filing would
satisfy the applicable requirements for perfection under sections
1 to 128, 147, 148, 158 and 188 to 195 of this 2001 Act, the
amendments to statutes by sections 129 to 146, 149 to 157 and 159
to 185 of this 2001 Act, the amendments to ORCP 81 A by section
186 of this 2001 Act and the repeal of statutes by section 187 of
this 2001 Act.
(3) Pre-effective-date filing in jurisdiction formerly
governing perfection. Sections 1 to 128, 147, 148, 158 and 188 to
195 of this 2001 Act, the amendments to statutes by sections 129
to 146, 149 to 157 and 159 to 185 of this 2001 Act, the
amendments to ORCP 81 A by section 186 of this 2001 Act and the
repeal of statutes by section 187 of this 2001 Act do not render
ineffective an effective financing statement that, before the
effective date of this 2001 Act, is filed and satisfies the
applicable requirements for perfection under the law of the
jurisdiction governing perfection as provided in ORS 79.1030
(1999 Edition). However, except as otherwise provided in
subsections (4) and (5) of this section and section 192 of this
2001 Act, the financing statement ceases to be effective at the
earlier of:
(a) The time the financing statement would have ceased to be
effective under the law of the jurisdiction in which it is filed;
or
(b) June 30, 2006.
(4) Continuation statement. The filing of a continuation
statement after the effective date of this 2001 Act does not
continue the effectiveness of the financing statement filed
before the effective date of this 2001 Act. However, upon the
Enrolled Senate Bill 171 (SB 171-ACCA) Page 141
timely filing of a continuation statement after the effective
date of this 2001 Act and in accordance with the law of the
jurisdiction governing perfection as provided in sections 21 to
62 of this 2001 Act, the effectiveness of a financing statement
filed in the same office in that jurisdiction before the
effective date of this 2001 Act continues for the period provided
by the law of that jurisdiction.
(5) Application of subsection (3)(b) to transmitting utility
financing statement. Subsection (3)(b) of this section applies to
a financing statement that, before the effective date of this
2001 Act, is filed against a transmitting utility and satisfies
the applicable requirements for perfection under the law of the
jurisdiction governing perfection as provided in ORS 79.1030
(1999 Edition) only to the extent that sections 21 to 62 of this
2001 Act provide that the law of a jurisdiction other than the
jurisdiction in which the financing statement is filed governs
perfection of a security interest in collateral covered by the
financing statement.
(6) Application of sections 72 to 98 of this 2001 Act. A
financing statement that includes a financing statement filed
before the effective date of this 2001 Act and a continuation
statement filed after the effective date of this 2001 Act is
effective only to the extent that it satisfies the requirements
of sections 72 to 98 of this 2001 Act for an initial financing
statement. + }
SECTION 192. { + 9-706. When initial financing statement
suffices to continue effectiveness of financing statement. + }
{ + (1) + } { + Initial financing statement in lieu of
continuation statement. The filing of an initial financing
statement in the office specified in section 72 of this 2001 Act
continues the effectiveness of a financing statement filed before
the effective date of this 2001 Act if:
(a) The filing of an initial financing statement in that office
would be effective to perfect a security interest under sections
1 to 128, 147, 148, 158 and 188 to 195 of this 2001 Act, the
amendments to statutes by sections 129 to 146, 149 to 157 and 159
to 185 of this 2001 Act, the amendments to ORCP 81 A by section
186 of this 2001 Act and the repeal of statutes by section 187 of
this 2001 Act;
(b) The pre-effective-date financing statement was filed in an
office in another state or another office in this state; and
(c) The initial financing statement satisfies subsection (3) of
this section.
(2) Period of continued effectiveness. The filing of an initial
financing statement under subsection (1) of this section
continues the effectiveness of the pre-effective-date financing
statement:
(a) If the initial financing statement is filed before this the
effective date of this 2001 Act, for the period provided in ORS
79.4030 (1999 Edition) with respect to a financing statement; and
(b) If the initial financing statement is filed after the
effective date of this 2001 Act, for the period provided in
section 86 of this 2001 Act with respect to an initial financing
statement.
(3) Requirements for initial financing statement under
subsection (1). To be effective for purposes of subsection (1) of
this section, an initial financing statement must:
(a) Satisfy the requirements of sections 72 to 98 of this 2001
Act for an initial financing statement;
Enrolled Senate Bill 171 (SB 171-ACCA) Page 142
(b) Identify the pre-effective-date financing statement by
indicating the office in which the financing statement was filed
and providing the dates of filing and file numbers, if any, of
the financing statement and of the most recent continuation
statement filed with respect to the financing statement; and
(c) Indicate that the pre-effective-date financing statement
remains effective. + }
SECTION 193. { + 9-707. Amendment of pre-effective-date
financing statement. (1) 'Pre-effective-date financing
statement.' As used in this section, 'pre-effective-date
financing statement' means a financing statement filed before the
effective date of this 2001 Act.
(2) Applicable law. After the effective date of this 2001 Act,
a person may add or delete collateral covered by, continue or
terminate the effectiveness of, or otherwise amend the
information provided in, a pre-effective-date financing statement
only in accordance with the law of the jurisdiction governing
perfection as provided in sections 21 to 62 of this 2001 Act.
However, the effectiveness of a pre-effective-date financing
statement also may be terminated in accordance with the law of
the jurisdiction in which the financing statement is filed.
(3) Method of amending: general rule. Except as otherwise
provided in subsection (4) of this section, if the law of this
state governs perfection of a security interest, the information
in a pre-effective-date financing statement may be amended after
the effective date of this 2001 Act only if:
(a) The pre-effective-date financing statement and an amendment
are filed in the office specified in section 72 of this 2001 Act;
(b) An amendment is filed in the office specified in section 72
of this 2001 Act concurrently with, or after the filing in that
office of, an initial financing statement that satisfies section
192 (3) of this 2001 Act; or
(c) An initial financing statement that provides the
information as amended and satisfies section 192 (3) of this 2001
Act is filed in the office specified in section 72 of this 2001
Act.
(4) Method of amending: continuation. If the law of this state
governs perfection of a security interest, the effectiveness of a
pre-effective-date financing statement may be continued only
under sections 191 (4) and (6) or 192 of this 2001 Act.
(5) Method of amending: additional termination rule. Whether or
not the law of this state governs perfection of a security
interest, the effectiveness of a pre-effective-date financing
statement filed in this state may be terminated after the
effective date of this 2001 Act by filing a termination statement
in the office in which the pre-effective-date financing statement
is filed, unless an initial financing statement that satisfies
section 192 (3) of this 2001 Act has been filed in the office
specified by the law of the jurisdiction governing perfection as
provided in sections 21 to 62 of this 2001 Act as the office in
which to file a financing statement. + }
SECTION 194. { + 9-708. Persons entitled to file initial
financing statement or continuation statement. A person may file
an initial financing statement or a continuation statement under
sections 188 to 195 of this 2001 Act if:
(1) The secured party of record authorizes the filing; and
(2) The filing is necessary under sections 188 to 195 of this
2001 Act:
(a) To continue the effectiveness of a financing statement
filed before the effective date of this 2001 Act; or
Enrolled Senate Bill 171 (SB 171-ACCA) Page 143
(b) To perfect or continue the perfection of a security
interest. + }
SECTION 195. { + 9-709. Priority. (1) Law governing priority.
Sections 1 to 128, 147, 148, 158 and 188 to 195 of this 2001 Act,
the amendments to statutes by sections 129 to 146, 149 to 157 and
159 to 185 of this 2001 Act, the amendments to ORCP 81 A by
section 186 of this 2001 Act and the repeal of statutes by
section 187 of this 2001 Act determine the priority of
conflicting claims to collateral. However, if the relative
priorities of the claims were established before the effective
date of this 2001 Act, ORS 79.1010 to 79.5070 and 79.8010 (1999
Edition) determine priority.
(2) Priority if security interest becomes enforceable under
section 13 of this 2001 Act. For purposes of section 42 (1) of
this 2001 Act, the priority of a security interest that becomes
enforceable under section 13 of this 2001 Act dates from the
effective date of this 2001 Act if the security interest is
perfected under sections 1 to 128, 147, 148, 158 and 188 to 195
of this 2001 Act, the amendments to statutes by sections 129 to
146, 149 to 157 and 159 to 185 of this 2001 Act, the amendments
to ORCP 81 A by section 186 of this 2001 Act and the repeal of
statutes by section 187 of this 2001 Act by the filing of a
financing statement before the effective date of this 2001 Act
which would not have been effective to perfect the security
interest under ORS 79.1010 to 79.5070 and 79.8010 (1999 Edition).
This subsection does not apply to conflicting security interests
each of which is perfected by the filing of such a financing
statement. + }
{ +
TITLE LOANS + }
SECTION 196. { + Sections 197 to 202 of this 2001 Act are
added to and made a part of ORS chapter 725. + }
SECTION 197. { + As used in sections 197 to 202 of this 2001
Act:
(1) A lender is 'in the business of making title loans' if at
least 10 percent of all loans made by the lender are title loans.
(2) 'Lender' includes individuals, corporations, associations,
firms, partnerships, limited liability companies and joint stock
companies. 'Lender' does not include a financial institution or
trust company, as those terms are defined in ORS 706.008.
(3) 'Title loan' means a loan, other than a purchase money
loan:
(a)(A) Secured by the title to a motor vehicle, recreational
vehicle, boat or mobile home;
(B) Made for a period of 60 days or less;
(C) With a single payment payback; and
(D) Made by a lender in the business of making title loans; or
(b) That is secured, substantially equivalent to a title loan
as defined in paragraph (a) of this subsection, and designated as
a title loan by rule or order of the Director of the Department
of Consumer and Business Services. + }
SECTION 198. { + A lender may not make a title loan to a
consumer without forming a good faith belief that the consumer
has the ability to repay the title loan. In forming a good faith
belief, the lender shall consider factors adopted by the Director
of the Department of Consumer and Business Services by rule. A
lender that meets conditions adopted by the director by rule
shall be deemed to be in compliance with this section. + }
Enrolled Senate Bill 171 (SB 171-ACCA) Page 144
SECTION 199. { + A lender in the business of making title
loans may not:
(1) Include any of the following provisions in a title loan
contract:
(a) A hold-harmless clause;
(b) A confession of judgment or other waiver of the right to
notice and the opportunity to be heard in an action;
(c) An agreement by the consumer not to assert any claim or
defense arising out of the contract against the lender or any
holder in due course;
(d) An executory waiver or a limitation of exemption from
attachment, execution or other process on real or personal
property held by, owned by or due to the consumer, unless the
waiver or limitation applies only to property subject to a
security interest executed in connection with the loan; or
(e) A clause permitting the continuation of interest after
repossession of the consumer's motor vehicle, recreational
vehicle, boat or mobile home;
(2) Conduct a title loan business where liquor or lottery
tickets are sold or where gambling devices are located;
(3) Charge the consumer more than one fee under ORS 30.701 for
dishonored checks when the consumer issues more than one check to
the lender. However, the lender may recover from the consumer any
fee charged to the lender by an unaffiliated financial
institution for each dishonored check;
(4) Require or accept from a consumer a set of keys to the
motor vehicle, recreational vehicle, boat or mobile home whose
title secures the title loan;
(5) Make more than one outstanding loan that is secured by one
title;
(6) Renew a loan that is secured by one title more than six
times after the loan is first made; or
(7) Make a new loan, secured by a title, to a consumer on the
same day that a previous loan, secured by the same title, expires
if the lender has renewed the previous loan six times. The lender
shall wait at least until the next day after the expiration date
of the previous loan before making the new loan to the
consumer. + }
SECTION 200. { + A person may not act as an agent or
facilitator for the purpose of making a title loan without first
obtaining a license under this chapter, regardless of whether the
principal making the loan is required to obtain a license. + }
SECTION 201. { + (1) A lender in the business of making title
loans shall include in every title loan contract a notice,
printed in type size equal to at least 12-point type, stating
that the consumer or the consumer's attorney may file a complaint
with the Director of the Department of Consumer and Business
Services as provided in this section.
(2) Any person claiming to be aggrieved by a practice that
violates a provision of section 198, 199 or 200 of this 2001 Act
or any rule adopted under section 202 of this 2001 Act, or the
person's attorney, may file with the director a verified
complaint in writing. The person shall state in the complaint the
name and address of the lender alleged to have committed the
unlawful practice and the particulars of the alleged unlawful
practice. The director may require the person to set forth in the
complaint other information that the director considers
pertinent. The person may file the complaint no later than one
year after the alleged unlawful practice.
Enrolled Senate Bill 171 (SB 171-ACCA) Page 145
(3) After the filing of a complaint under this section, the
director may cause an investigation to be made under ORS
725.310. + }
SECTION 202. { + In accordance with ORS 183.310 to 183.550,
the Director of the Department of Consumer and Business Services
may adopt rules for the purpose of carrying out the provisions of
sections 197 to 202 of this 2001 Act, including but not limited
to establishing contract terms, charges and fees for title
loans. + }
SECTION 203. ORS 725.910 is amended to read:
725.910. (1) The Director of the Department of Consumer and
Business Services may assess { + against + } any person who
violates any provision of this chapter { + , + } or any rule or
final order of the director under this chapter, a civil penalty
in an amount determined by the director of not more than $2,500.
In addition, if a licensee commits such a violation, the director
may revoke the license of the licensee.
(2) Civil penalties under this section shall be imposed as
provided in ORS 183.090.
(3) { + Except as provided in subsection (4) of this
section, + } all moneys collected under this section shall be
paid to the State Treasurer and credited as provided in ORS
705.145.
{ + (4) In addition to any other penalty provided by law, the
director may assess against any person who lends money without
the license required under this chapter a civil penalty in an
amount equal to the interest received that exceeds nine percent
per annum. The director shall pay all moneys collected under this
subsection to the Division of State Lands for the benefit of the
Common School Fund. + }
{ +
CAPTIONS + }
SECTION 204. { + The unit, section and subsection captions
used in this 2001 Act are provided only for the convenience of
the reader and do not become part of the statutory law of this
state or express any legislative intent in the enactment of this
2001 Act. + }
{ +
EMERGENCY CLAUSE + }
SECTION 205. { + This 2001 Act being necessary for the
immediate preservation of the public peace, health and safety, an
emergency is declared to exist, and this 2001 Act takes effect
July 1, 2001. + }
----------
Enrolled Senate Bill 171 (SB 171-ACCA) Page 146
Passed by Senate January 24, 2001
Repassed by Senate June 1, 2001
...........................................................
Secretary of Senate
...........................................................
President of Senate
Passed by House March 27, 2001
Repassed by House June 5, 2001
...........................................................
Speaker of House
Enrolled Senate Bill 171 (SB 171-ACCA) Page 147
Received by Governor:
......M.,............., 2001
Approved:
......M.,............., 2001
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2001
...........................................................
Secretary of State
Enrolled Senate Bill 171 (SB 171-ACCA) Page 148