Commercial Paper + Secured Transactions

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Can you name the Obscure Rules from Commercial Paper/Secured Transactions?

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QuestionAnswerExtra Notes
Warranty 5 that runs with the instrument: D promises that she has no knowledge of any ______ or ______ action against the maker or drawerwhen a D indorses a check to another person
Proper filing (via perfection) puts the world of potential creditors on _____ or ______ notice of the filer's claim
After a debtor defaults, self-help repossession is permissible so long as Creditor does not _____ ____ ____, which occurs when the secured party's action are likely to ______ _____not relevant if actual fight broke out, but whether it was likely to happen
Negotiable instrument: a __; payable to _ or bearer; __ by the maker or drawer; for a __ certain; containing an ____ ____ & no addtl ones; payable on _____ and payable in _______ WOSSUPP
Self help repossesor may not entor debtor's home without ________ and _________ consent
When a Defendant indorses a check, _______ run with the instrument
Someone who obtains an enforceable security interest but either neglects or fails to properly perfect it is called:
'Fraud in the Factum' means lies about ONLY the _______ itself. Lies to induce the holder not about the instrument are personal and thus ineffective against HIDC
If collateral IS consumer goods and debtor has paid 60% strict foreclosure is ____ _____. Instead, the SP must sell the collateral within ____ _____Failure to sell within that time makes SP liable in conversion!
General unsecured creditor who gets a judicial lien is called a:
'Without Recourse' accompanying a signature means that the signator has passed title but has no signature _________
An Article 9 creditor who succeeds in attaining perfection is called a
Warranty 4 that runs with the instrument: D promises that there is no defense or claim good against the D meaning that the instrument is _________when a D indorses a check to another person
Warranty 1 that runs with instrument: D promises that the P has _____ _____ to the instrumenti.e when a D indorses a check to another person
Filing a financing statement is done with the Sec of State in state where ______ is located, which is the state where she has her ______ ______. EXCEPTION: if the collateral is timber, minerals or fixtures file locally!
Shelter Rule provides that the transferee acquirers whatever _______ that her ______ hadEven if transferee is a mere donee she can be a holder in due course so long as transferor was
When a negotiable instrument is duly negotiated to a holder in due course, he takes the intrument free of all _____, free of ______ ______, and subject only to ______ _____
If maker was negligent, he is _______ from raising material alteration as a defense.
Strict foreclosure will not be allowed if any of the notified parties objects within _____ days
To strictly foreclose and collateral is NOT consumer goods, notice is sent to ______ and other _____ _____ who have told SP of their security interest in collateral, as well as ___
Security Agreement must be ________ by debtor and it must reasonably ______ the collateralsigned or electronically marked for security agreement
Once SP has taken collateral, he may sell it provided that every aspect of the sale is _____ ______ and prior to the sale ______ _____ must be sent to the debtorif public sale, notice must state time and place, and if nonconsumer transaction, 10 days or more advance notice of the sale is reasonable
3 requirements for Attachment:1) _____ must be given by the creditor; 2) ______ called the 'security agreement'; Debtor must have ______ in the collateralVCR
A repossession made OVER ANY PROTEST by the debtor constitutes a ____ of the _______
A security interest that enables the debtor to purchase goods is called a ______ _____ ______ ______
AACF vs PMSI and collateral is EQUIPMENT; To get first priority over AACF, PMSI must properly ______ within ___ _____ after debtor takes possession of the good in question
QuestionAnswerExtra Notes
'Duly Negotiated' means that there has been a proper ______ of the instrument.
Strict Foreclosure: When secured party retains the collateral in _____ _____ of the ______
A writing stating 'pay to Bill' without more is NOT negotiable bc it doesn't contain the words _____ or ______ (Or assigns works too)
Someone who purchases collateral from a merchant's inventory is called a
'After acquired collateral clauses' enforceable?
AACF vs PMSI and collateral is INVENTORY; To achieve first priorty PMSI must properly _____ BEFORE debtor takes possession AND must _____ the AACF (bank) BEFORE debtor takes possesRationale is to prevent Debtor Fraud
Lender who doesn't bother to take collateral called a:
Judicial writ ordering sheriff to obtain possession of collateral and deliver it to secured party is called a
If defendant didn't indorse the check then only the _______ _______ may sue the D.
Any condition in the intstrument makes it a contract and thus _____ ________
To strictly foreclose and the collateral is consumer goods, secured party must send _____ to the ______(and any secondary obligors who are just guarantors of the debt)
'Perfection' is attained when: 1)Secured party ___ ___ of collateral; 2) Automatic perfection for a __ in consumer goods; secured party __ ___ of the sec interest in the public re
Debtor's right to redeem in collateral is cut off once the SP has _______ the collateral or completed a _____ ______.*To redeem, debtor has to fufill debt and pay interest and expenses inc attorney's fees
Lack of Consideration, unconscionability, waiver, estoppel, fraud in the inducement are all examples of _________ defensesAll are ineffective against Holder in due course
Superior Ownership claim over the instrument held by a Holder in Due Course, the ________ wins.
buyer who purchases collateral outside ordinary course of business is called a
In what order does each creditor have the claim to the same collateralEach claimant entitled to Satisfaction in Full before next suboordinate claimant can take anything
If HIDC had _____ ____ _____ that instrument was dishonored, overdue or subject to a claim then he will be deemed to have notice.THUS in this circumstance he wont be a holder in due course
Holder in due course is subject to all real defenses which are: MADFIFI4
Self help repossessor who misuses the color of law has used _____ _____ and thus has breached the peace
Warranty 2 that runs with the instrument: D promises that all signatures are ______ and _______when a D indorses a check to another person
Secured creditor who takes as collateral a security interest 'in all Debtor's X (inventory eg) whether now held or hereafter acquired' is called an the now held or hereafter acquired clause= acter acquired collateral clause and gives rise to an aacf
If the instrument has been improperly transferred, the transferee cannot qualify as a _____ ___ ___ ______
Holder in Due Course is someone who takes the instrument: _____ _____ and in _____ _____ and _____ ______ that its overdue, or subject to any defense or claim.
Warranty 3 that runs with the instrument: D promises that the instrument has not been _______ ______when a D indorses a check to another person
Under Art 9, what takes priority: person who filed first or the person who attached first? it is the person who _______ first

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