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39 Cards in this Set
- Front
- Back
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A Lien is...
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A lien is a claim against property to satisfy a debt or to protect a claim for a payment of debt
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Mechanic's Lien
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A claim against real property when a person contracts for labor, services or materials to improve property but does not pay
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When must a creditor file a lien...
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Usually within 60 to 120 days
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Artisan's Liens are...
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A claim against personal property
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Artisans Liens the creditor..
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Must posses the personal property...lien terminates if possession is surrendered
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Judicial Liens are...
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Court ordered seizure and taking into custody of property before the entry of a final judgement
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Mortgage Redemption Rights...
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A mortgagor can redeem the property at ANY TIME BEFORE the sale by paying the full amount of the debt, plus interest and costs.
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Surety is..
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A promise by a 3rd party to be responsible for a debtors obligation. It does NOT have to be in writing. A surety is PRIMARILY LIABLE- a creditor can demand payment when debt is due
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A guaranty is....
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A guaranty is a promise to be secondarily liable for the the debt or default of another. A guarantor pays ONLY after the debtor defaults and the creditor has made attempts to collect. A guaranty MUST be in writing.
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Defenses of the Surety or Guaranty are...
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1) Material Change to the Contract
2) Principal Obligation is Paid or Valid Tender is Made. 3) Most of the Defenses of Principal Debtor (Bankruptcy cannot be used) 4) A Surety or Guarantor's Own Defenses (i.e. Fraud by Creditor) 5) A Creditor's Surrender or Impairment of Collateral. |
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Rights of the Surety and the Guarantor...
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1) Right of Subrogation
2) Right of Reimbursement 3) Co-Sureties' Right of Combination |
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The Protection for Debtors are...
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1) Real Property (Homestead)
2) Personal Property (Tools of the Trade) |
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A Secured Transaction is...
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A transaction in which payment is of a debt is is guaranteed by personal property owned
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A Security Interest is...
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The interest in the collateral the secures payment or performance of an obligation
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The 3 Requirements of a Security Interest are..
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1) Written Security Agreement
2) Secured Party Must Give Value 3) Debtor Must Have Rights in the Collateral |
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How can you Perfect without filing...
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1) Perfect by Possesion
2) Perfect by Attachment |
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Perfection by Attachment
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1) Purchase Money Security Interest (PMSI)
2) Pefection of a PMSI Consumer Goods are automatically perfected 3) Exceptions - Interests subject to Federal or State laws |
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How long are Perfections good for?
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A Financing Statement is good for 5 years and continuation must be filed within 6 months before expiration
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The most common way to perfect a security interest is...
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By Filing a Financing Statement
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Where do you file a financing statement?
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Individual-State of Debtors Residence
Corporation-State of Charter on Incorporation Other- State where business is conducted |
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What are the exceptions to Secured Parties V. Buyers
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1) Buyer in the Ordinary Course of Business
2) Buyer of Consumer Goods Purchased outside the Ordinary Course of Business (Not a where of security interest; Must give VALUE, BEFORE interest is perfected) 3) Buyer of Instruments, Documents, or Securities (aka. HDC) |
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Repossession of the collateral...
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Can be done if it does not breach the peace
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Retention of collateral requires...
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Notice
Secured party must give WRITTEN notice to the debtor. Notice must also be sent to any other party from whom the secured party has received notice of a claim Must dispose of collateral if other secured party objects or debtor objects WITHIN 20 days |
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Chapter 7 Liquidation is..
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The most familiar type of bankruptcy. Debtor gives all NON-EXEMPT assets to a trustee.
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Who can file for Chapter 7
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Any "person"-individuals, partnerships, and corporation. Provided they pass the MEANS test.
Except: Railroads, Insurance Companies, Banks, Saving and Loans, and Credit Unions. |
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Exceptions to the Automatic Stay are...
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Domestic Support Obligations, Related Proceedings, Securities Regulation Investigations, Propety Tax Liens, Prior Eviction Actions, and Withholding to Repay Retirement Loans.
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Not Included in the Property of the Estate...
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Property Acquired after the filing of the petition,Withholding for Employee Benefit Plan Contributions, Life Insurance Proceeds the Debtor entitled to AFTER 180 days.
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The Debts that may not be Discharged are...
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Claims for back taxes, Amounts owed for back taxes, goods obtained by fraud, debts that were not listed in the petition, domestic support, student loans, certain cash advances, and others.
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Chapter 11 Reorganizations are
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When creditors and debtors formulate a plan under which the debtor pays a portion of the debts, is discharged from the rest, and continues in business.
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Who is eligible to file Chapter 11...
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Any "person" eligible for Chapter 7 is eligible.
Exceptions: Stock or Commodities Broker and those exceptions in 7 |
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How many creditors must approve the plan?
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Two-Thirds of total claims must be approved.
If not the court can confirm it under the code's cram down provision provided it does not discriminate unfairly against creditors |
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Who is Eligible for Chapter 13?
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Individuals ONLY. With regular income and unsecured debts not to exceed $307,615 or secured debts not to exceed $922,975 are eligible
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Accountants Duty of Care
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1) Comply with Accounting Principles and Standards
2) Act in Good Faith 3) Investigate Suspicious Financial Transactions 4) Designate Financial Statements as Unaudited |
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The ULTRAMARES Rule is...
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1) The Privity Requirement
2) The "Near Privity" Rule |
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The RESTATEMENT Rule states...
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Accountants are liable for negligence to persons whom the accountant "intends to supply the information or knows that the recipient intends to supply it" and the person whom the accountant "intends the information to influence or knows that the recipient so intends"
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Accountants also have liability to ...
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Reasonably Foreseeable Users
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Liability under the SEC act of 1933
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Accountant may be liable to anyone who acquires a security covered by the statement. A plaintiff MUST show that he or she suffered a loss on the security. NO REQUIREMENT of privity or proof of reliance
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Liability under the SEC act of 1934
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Sellers and Purchasers who can PROVE the statement affected the price of the security and they relied on the statement and were UNAWARE of its inaccuracy
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Liability under SEC Act of 1934
Misstatement or Omission |
Liable to Purchasers or Sellers. They must prove: scienter, fraud, reliance, MATERIALITY, causation
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