Chapter 267 Oregon Laws 2003

AN ACT

SB 136

Relating to authority of Secretary of State to prevent wrongful filings under Uniform Commercial Code-Secured Transactions; creating new provisions; and amending ORS 79.0102, 79.0516 and 79.0520.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 79.0102 is amended to read:

79.0102. (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, 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

(e) “Agricultural lien” means an interest, other than a security interest or a lien created under ORS 87.226, 87.228, 87.700 to 87.736 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

(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 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

(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

(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;

(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;

(B) A seller of accounts, chattel paper, payment intangibles or promissory notes; or

(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;

(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 ORS 79.0519 (1).

(kk) “Filing office” means an office designated in ORS 79.0501 as the place to file a financing statement.

(LL) “Filing-office rule” means a rule adopted pursuant to ORS 79.0526.

(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 ORS 79.0502 (1) and (2). 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.

(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;

(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:

(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;

(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 ORS 79.0203 (4) 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 ORS 79.0310 (3), means a person that, as debtor, entered into a security agreement to which a new debtor has become bound under ORS 79.0203 (4).

(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;

(B) A brother, brother-in-law, sister or sister-in-law of the individual;

(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 ORS 79.0609 (2), 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;

(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 ORS 79.0620, 79.0621 and 79.0622.

(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.

(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;

(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 75.1180.

(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

(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] an organization primarily engaged in the business of:

(A) Operating a railroad, subway, street railway or trolley bus;

(B) Transmitting communications electrically, electromagnetically or by light;

(D) Transmitting or producing and transmitting electricity, steam, gas or water.

(2) The following definitions in other sections apply to this chapter:

“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 right) ORS 75.1020

“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

“Security” ORS 78.1020

“Security certificate” ORS 78.1020

“Security entitlement” ORS 78.1020

“Uncertificated security” ORS 78.1020

(3) ORS chapter 71 contains general definitions and principles of construction and interpretation applicable throughout this chapter.

SECTION 2. ORS 79.0516 is amended to read:

79.0516. (1) 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) 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;

(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 ORS 79.0512 or 79.0518, as applicable; or

(ii) Identifies an initial financing statement whose effectiveness has lapsed under ORS 79.0515 (1) to (7) and the filing office is that described in ORS 79.0501 (1)(b);

(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 ORS 79.0501 (1)(a), 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 ORS 79.0501 (1)(a);

(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 ORS 79.0501 (1)(a); or

(C) If the filing office is that described in ORS 79.0501 (1)(b) 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 ORS 79.0514 (1) or an amendment filed under ORS 79.0514 (2), 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 ORS 79.0515 (4) and the filing office is that described in ORS 79.0501 (1)(b)[.]; or

(h) In the case of a record presented for filing at the filing office described in ORS 79.0501 (1)(b), the record on its face reveals, based on factors such as whether the debtor and the secured party are the same person or whether the collateral described is within the scope of this chapter, that the record is being filed for a purpose other than a transaction that is within the scope of this chapter.

(3) 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 ORS 79.0512, 79.0514 or 79.0518, is an initial financing statement.

(4) 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 3. ORS 79.0520 is amended to read:

79.0520. (1) A filing office shall refuse to accept a record for filing for a reason set forth in ORS 79.0516 (2) and may refuse to accept a record for filing only for a reason set forth in ORS 79.0516 (2).

(2)(a) 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 ORS 79.0501 (1)(b), 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.

(b) In the case of a refusal to accept a record under ORS 79.0516 (2)(h), the filing office shall, within the period specified in paragraph (a) of this subsection, index the communication regarding the refusal and not the refused record. The communication must remain indexed for 20 days after the date of the communication unless, within the 20-day period, the secured party files a request for a hearing under subsection (5) of this section. If the secured party files a timely request for a hearing, the communication must remain indexed until the case is finally concluded.

(3) A filed financing statement satisfying ORS 79.0502 (1) and (2) is effective, even if the filing office is required to refuse to accept it for filing under subsection (1) of this section. However, ORS 79.0338 applies to a filed financing statement providing information described in ORS 79.0516 (2)(e) which is incorrect at the time the financing statement is filed.

(4) If a record communicated to a filing office provides information that relates to more than one debtor, ORS 79.0501 to 79.0528 apply as to each debtor separately.

(5)(a) If the filing office described in ORS 79.0501 (1)(b) refuses to accept a record for filing under ORS 79.0516 (2)(h), the secured party may contest the refusal by filing with the Secretary of State, within 20 days after the date of the communication regarding the refusal, a written request for a hearing before the Secretary of State. The request need not be in any particular form, but the secured party shall specify the grounds upon which the secured party considers the refusal unlawful and shall attach the record to the request.

(b) The Secretary of State may not grant a hearing unless a secured party files a request for a hearing within the period specified in paragraph (a) of this subsection. If a secured party files a timely request for a hearing, the Secretary of State shall hold a hearing in accordance with the applicable provisions of ORS 183.310 to 183.550.

(c) The Secretary of State may delegate to a hearing officer appointed by the Secretary of State all or part of the authority to conduct hearings under this subsection.

(d) If the Secretary of State or the hearing officer determines that the record should not have been refused, the filing office shall index the record as of the date the record was originally presented for filing.

(e) Final orders issued in a proceeding under this subsection are subject to review by the Court of Appeals as provided in ORS 183.480 and 183.482.

SECTION 4. The amendments to ORS 79.0102, 79.0516 and 79.0520 by sections 1 to 3 of this 2003 Act apply to records filed with the Secretary of State before, on or after the effective date of this 2003 Act.

Approved by the Governor June 10, 2003

Filed in the office of Secretary of State June 11, 2003

Effective date January 1, 2004

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