Ma Secured Transactions

Front 1

What is the scope of Article 9 of the UCC?

Back 1

Article 9 applies to consensual security interests in personalty or fixtures.
Note: When the collateral is real estate, apply the law of MORTGAGES.
By contrast, when the collateral is personalty or fixtures, apply ARTICLE 9.
In general, personalty equals GOODS. Remember that Article 9 applies only to voluntary or consensual collateralizations. Thus, it does not apply to STATUTORY OR MECHANICS LIENS.

Front 2

Giorgio Armani borrows $2 million from Bank. He grants Bank a security interest in his business equipment. Are we within the scope of Article 9?

Back 2

YES. Why? This is A VOLUNTARY TRANSFER of a security interest in debtor’s GOODS.

Front 3

Who are the cast of characters in Article 9?

Back 3

B. The Article 9 Cast of Characters:
i. debtor: ENTITY WHO OWES THE MONEY
ii. secured party or secured creditor: ENTITY WHO LENDS THE $
iii. security agreement: CONTRACT OR RECORD
iv. security interest: RIGHT CREDITOR HAS IN PERSONALTY OR FIXTURES
v. collateral: PERSONALTY OR FIXTURES THAT CREDITOR CAN LOOK TO FOR SATISFACTION.

Front 4

What are the types of collateral covered in Article 9?

Back 4

a. consumer goods: those items used for personal or familial purposes, such as a home dining room set, blender, oven, refrigerator, car; or
b. equipment: items used in business, such as Macy’s cash registers, Mrs. Field’s cookie ovens, Le Cirque restaurant’s china, Dr. Dentist’s dental chair, Armani’s sewing machines; or
c. inventory: goods held for sale or lease, such as Circuit City’s stock of stereos, Nordstrom’s spring clothing line or Ethan Allen’s furniture line; or
d. farm products: crops, livestock and supplies used in farming operations, such as eggs, corn and cows in possession of a farmer.
e. fixtures: items annexed to realty, such as lighting fixtures, sprinkler systems, furnaces.

Front 5

How does one classify tangible collateral?

Back 5

The key for purposes of classifying tangible collateral:
primary use in the hands of THE DEBTOR.
GOLF CLUBS IN YOUR HANDS = CONSUMER GOODS
IN THE HANDS OF TIGER WOODS = Equipment
IN THE HANDS OF GOLF PRO STORE = INVENTORY
or SUBJECTIVE MEASUREMENT

Front 6

What are the important intangible collaterals?

Back 6

PATENT AND TM RIGHTS
COPYRIGHTS
STOCKS, BONDS, AND MUTUAL FUNDS
PROCEEDS RECEIVED ON SALE OF COLLATERAL
ACCOUNTS – RIGHT TO PAYMENT FOR GOODS/SERVICES
PROMISSORY NOTES
DRAFTS

Front 7

How does one create an enforceable security interest?

Back 7

Attachment which means creating an enforceable security interest.

Front 8

How does one attach?

Back 8

The three requirements for attachment: remember “VCR”
i. VALUE must be given by creditor.
For example, Bank lends $50,000 to Debtor. Bank has extended value.
ii. a CONTRACT, called the security agreement, must evidence the secured transaction unless the secured party has taken possession of the collateral.
iii. RIGHTS in the collateral: Debtor must have rights in the collateral.

Front 9

Can we substitute something for the contract? If we need a written contract, what are the requirements?

Back 9

If the secured party is in possession of the collateral, there is no need for A RECORD. By contrast, if the debtor is in possession of the collateral, WE NEED A RECORD.
The record must:
a. BE AUTHENTICATED BY THE DEBTOR (SIGNED OR ELECTRONICALLY MARKED)
and
b. REASONABLY IDENTIFY THE COLLATERAL

Front 10

Mick Jagger lends $20,000 to Keith Richards, who gives Mick a security interest in the Brooklyn Bridge. Can Mick look to the Brooklyn Bridge for satisfaction of the debt when Keith fails to pay?

Back 10

NO – DEBTOR DOES NOT HAVE RIGHTS IN THE COLLATERAL – THIS IS THE COMBINATION OF THE MICK JAGGER RULE (“CAN’T ALWAYS GET WHAT YOU NEED”) AND THE KEITH RICHARDS RULE (“I CAN’T GET NO SATISFACTION.”)

Front 11

Can I get a security interest in items that are acquired after the contract is signed?

Back 11

Yes - “after-acquired collateral clauses” are enforceable.

Front 12

Secured Party lends $500,000 to Staples Stores, taking a security interest “in all of Staples’ inventory, whether now held or hereafter acquired.” What kind of clause is this? Is it enforceable?

Back 12

This sort of clause is called: AN AFTER ACQUIRED COLLATERAL CLAUSE

It is: ENFORCEABLE!

Front 13

What is perfection?

Back 13

Perfection is best understood as a PUBLICITY DEVICE.

PERFECTION = PUBLICITY

It is something that the secured party does to put the world on RECORD or CONTSTRUCTIVE notice of the secured party’s existence. Proper perfection helps to protect the secured party from competing creditors.

Front 14

Diana Ross lends $300,000 to Smokey Robinson, taking a security interest in Smokey’s vintage album collection. Diana attaches (meaning that she has complied with the VCR requirements. She extended VALUE, executed a valid CONTRACT or security agreement and Smokey has RIGHTS in the album collection.). What does Diana do to protect her interest?

Back 14

To protect herself from subsequent creditors who might stake a claim to the album collection, Diana promptly and properly PERFECTS HER INTEREST.

Front 15

Diana Ross lends $300,000 to Smokey Robinson, taking a security interest in Smokey’s vintage album collection. Diana attaches (meaning that she has complied with the VCR requirements. She extended VALUE, executed a valid CONTRACT or security agreement and Smokey has RIGHTS in the album collection.). She perfects her interest.

Later, suppose that Smokey, in need of quick cash, borrows $100,000 from The Temptations, granting them a security interest in the same album collection. What happens if Smokey defaults?

Back 15

If Smokey defaults, DIANA defeats THE TEMPTATIONS meaning that she has FIRST PRIORITY in the album collection.

THE CREDITOR WHO PERFECTS FIRST IS SUPREME.

Front 16

How do I perfect my interest?

Back 16

A. By the secured party’s taking possession of the collateral
B. Automatic perfection for purchase money security interests (PMSIs) in consumer goods.
C. the secured party FILES NOTICE of the security interest in the public records: Proper filing puts the world of potentially competing creditors on RECORD or CONSTRUCTIVE notice of the filer’s claim.

Front 17

Siegfried and Roy borrow $5,000 from Cher, granting Cher a security interest in their famous pig, Babe. Cher properly attaches and then takes possession of the pig until the debt is repaid. What must Cher do to perfect?

Back 17

NOTHING


Cher’s taking possession equals PERFECTION.
CHER = PERFECTION – “BABE, I’VE GOT YOU BABE.”

Front 18

Tell me about PMSIs?

Back 18

B. Automatic perfection for purchase money security interests (PMSIs) in consumer goods:

To encourage lending to consumers, PMSIs in consumer goods are perfected automatically, upon attachment.

Front 19

But, what IS a PMSI?

Back 19

It is a security interest that enables the debtor to purchase the goods.

Front 20

Ethan Allen extends $6,000 in value to enable Debtor to acquire a new bedroom set. Ethan Allen takes as collateral a security interest in the bedroom set. What does Ethan Allen have?

Back 20

It has: A PMSI Upon attachment, PERFECTION IS AUTOMATIC
THE FAVORITE CHILD OF ARTICLE 9 IS THE PMSI

Front 21

So, I want to file my notice of my security interest. What do I do?

Back 21

The security agreement could be filed, but rarely is. Instead, the document typically filed is called a FINANCING DOCUMENT. It is a very simple document whose only purpose is to provide interested parties with sufficient information to make FOLLOWUP INQUIRIES Article 9 aims to encourage ELECTRONIC FILING, and is “MEDIA NEUTRAL.”

Front 22

What are the requisite contents of a financing statement?

Back 22

Our buzzwords: SIMPLE AND SPARSE
The financing statement need only contain:
1) DEBTOR’S NAME AND ADDRESS
2) SECURED CREDITOR’S NAME AND ADDRESS
and
3) A DESCRIPTION OF THE COLLATERAL
In the financing statement, super-generic descriptions of the collateral (such as “all of Debtor’s assets”) are PERMISSIBLE.

Front 23

Where is the financing statement filed?

Back 23

Filing is done centrally, with the state Secretary of State, in the state where IS LOCATED
- If debtor is an individual, he or she is located: IN HER STATE OF PRINCIPLE RESIDENCE.
- If debtor is a registered organization (i.e., a corporation, a limited liability company or a limited partnership), it is located: UNDER WHOSE LAWS IT IS ORGANIZED.
- The exception to central filing: If the collateral is TIMBER, MINERALS or FIXTURES, file LOCALLY, in the county where THE UNDERLYING REALTY IS LOCATED.

Front 24

What’s the most important part of secured transactions?

Back 24

Priority – if there are more than one secured party, who gets to take first?
The basic concept: Priority is the purpose of collateralization, and the secured party seeks to SUBORDINATE, not to SHARE.
This is a piggish norm. Each claimant is entitled to satisfaction IN FULL before a subordinated claimant is entitled to take.

FAT BASTARD IN AUSTIN POWERS – BABY BACK RIBS

Front 25

Who are the cast of characters of priority?

Back 25

AUPie – Attached Unperfected Creditor
LC – Lien Creditor
PAC – Perfected Attached Creditor
NOCie – Non-Ordinary Course Buyer
BIOC – Buyer in Ordinary Course
GUC – General Unsecured Creditor

Front 26

What’s an AUPie, Attached Unperfected Creditor?

Back 26

AUPie (Attached Unperfected Creditor): This is the Article 9 creditor who creates an enforceable security interest, i.e., it attaches, but either never bothers to perfect or tries to perfect but botches the effort, perhaps by filing in the wrong place.

Front 27

What is a lien creditor?

Back 27

LC (lien creditor): This is the general unsecured creditor who goes to court to get a judicial lien on the collateral.

Front 28

What is a perfected attached creditor (PAC)?

Back 28

PAC (Perfected Attached Creditor): This is the Article 9 creditor who succeeds in attaining perfection.

Front 29

What is a non-ordinary course buyer?

Back 29

NOCie (Non-Ordinary Course Buyer): This is someone who purchases the collateral outside the ordinary stream of commerce. For example, Steven Tyler buys a guitar from his auto mechanic.

Front 30

What is a buyer in ordinary course (BIOC)?

Back 30

BIOC (Buyer in Ordinary Course): This is someone who purchases the collateral from a merchant’s inventory. For example, Steven Tyler buys a guitar from Sam Ash Guitar Store.

Front 31

What is a general unsecured creditor?

Back 31

GUC (General Unsecured Creditor): This is the lender who never bothered to take collateral. For example, Jared lends the Subway Sandwich Co. $50,000, and, believing it to be a good credit risk, takes no collateral to back up his extension of value. – SUPREME LOSER IN ANY ARTICLE 9 SITUATION

JARED LOANS $50K TO SUBWAY WITH NO SECURITY INTEREST – SUPREME LOSER

Front 32

In a nutshell, how do the characters rank?

Back 32

Rank:

1. BIOC
2. PAC
3. LC
4. NOCie
5. AUPie
6. GUC

Front 33

Who wins between AUPie vs. the World?

Back 33

AUPie vs. The World:
First, the good news:

AUPie’s interest is enforceable as against THE DEBTOR , and AUPie will defeat any subsequent AUPie as well as any GUC.

Second, the really bad news:

AUPie will lose to PAC, to LC, and to ANY BUYER without knowledge of the security interest.

Front 34

What about PAC v. the World?

Back 34

B. PAC vs. The World:
The basic rule: PAC defeats all, except:

i. the PAC who filed first;
ii. certain PMSI-holders;
iii. the BIOC.

Front 35

What happens when there are two PACs, who wins?

Back 35

The PAC who filed first: PAC vs. PAC: The Rule: FIRST IN TIME, FIRST IN RIGHT

Front 36

Example 7: Calista Flockhart extends $10,000 in value to Robert Downey, Jr., taking a security interest in Robert’s Rolex watch. Calista perfects properly on Jan. 10, 2003. Later, Barry White extends $5,000 in value to Robert, taking a security interest in the same watch. Barry perfects properly on Feb. 1, 2003. Who has first priority in the watch?

Back 36

Calista – she filed first. RULE: First in time, first in right.

Note that for purposes of determining priority, Article 9 gives special effect to filing. It allows for early filing, even at the onset of loan negotiations. If an early filer subsequently attaches, she is allowed the benefit of her early filing. Priority will relate back to the early filing date.

Front 37

Suppose now that on Jan. 1, Calista begins negotiating with Robert about lending him $10,000. On Jan. 1, Calista files a financing statement covering Robert’s Rolex. The negotiations continue. Later, Barry lends Robert $10,000, and on Feb. 1, Barry perfects a security interest in the Rolex. On March 1, Calista and Robert finally reach an agreement and Calista lends him the $10,000 and Robert signs an appropriate security agreement granting Calista a security interest in the Rolex. Who has first priority in the watch?

Back 37

CALISTA

Why? SHE FILED FIRST, AS SHE’S ALLOWED TO DO, AND SHE SUBSEQUENTLY ATTACHED. NOW, HAVING ATTACHED, HER ATTACHMENT IS RELATED BACK TO THE EARLIER FILING DATE.

Front 38

What about when a PAC v. PMSI? First question, when does this arise? Who is an AACF?

Back 38

Here, the relevant priority contest is between the after-acquired collateral financier (AACF) and the holder of a purchase-money security interest (PMSI).
First, who is an AACF?

A secured creditor who takes as collateral a security interest “in all of Debtor’s [business equipment, for example, or inventory, for example], whether now held or hereafter acquired.” When you’ve got an after-acquired collateral clause, you’ve got an AACF.

Front 39

What about when a PAC v. PMSI? Okay, so we know about the AACF, what’s a PMSI again?

Back 39

Second, what is a PMSI?

A security interest that enables the debtor to purchase the goods. In other words, it is an extension of value by a lender who takes as collateral a security interest in the very item that its loan enables the debtor to acquire.

Front 40

Debtor purchases a $4,000 stereo system on credit from The Wiz, granting The Wiz a security interest in the stereo system. What interest does the Wiz have in the stereo?

Back 40

The Wiz has a PMSI.

Front 41

Debtor borrows $4,000 from Bank to purchase a stereo system, granting Bank a security interest in the stereo system. What interest does Bank have in the stereo?

Back 41

Bank has PMSI.

Front 42

What about when a PAC v. PMSI? How does an AACF collide with the PMSI?

Back 42

a. The AACF v. the PMSI-holder when the collateral is equipment
b. The AACF v. the PMSI-holder when the collateral is inventory

Front 43

On March 1, Macy’s borrows $2 million from Bank, granting Bank a security interest “in all of Macy’s business equipment, whether now held or hereafter acquired.” Bank properly perfects its interest. Bank is what?
Later, on August 1, Macy’s buys 10 new cash registers on credit from Office Depot, granting Office Depot a security interest in the new cash registers. Office Depot is what?
The collateral is classified as what?
How can Office Depot achieve first priority in the 10 new cash registers?

Back 43

Bank is an AAFC
Office Depot is a PMSI holder
The collateral is classified as equipment

All that Office Depot must do is FILE PROPERLY within 20 DAYS after Macy’s takes possession of the cash registers.

Front 44

On Oct. 1, Macy’s borrows $2 million from Bank, granting Bank a security interest “in all of Macy’s inventory, whether now held or hereafter acquired.” Bank properly perfects its interest. Bank is what?
Later, on Jan. 1, Macy’s acquires Armani’s spring line of clothing on credit, granting Armani a security interest in the line. Armani is what?
The collateral is classified as what?

How can Armani achieve first priority in the Armani spring line?

Back 44

Bank is AAFC PAC.
Armani is PMSI HOLDER.
The collateral is classified as INVENTORY.

Armani must do two things:
1. Armani must FILE PROPERLY before debtor Macy’s takes possession AND
2. Armani must NOTIFY BANK before debtor Macy’s takes possession.

Front 45

Why do we require these steps when we’re talking about inventory?

Back 45

The reason for these additional safeguards when the collateral is inventory: TO PREVENT DEBTOR FROM COMMITTING FRAUD (insofar as debtor might otherwise entice the AACF into extending additional value to it on the basis of the new acquisition of inventory, failing to mention that the new inventory is already encumbered on behalf of the PMSI lender).

Front 46

What about PAC vs. BIOC?

Back 46

General rule: PAC loses to BIOC. A buyer in the ordinary course of business takes free of a perfected security interest in seller’s inventory.

Front 47

Bank has a perfected security interest in Nordstrom’s inventory. When Mrs. Jones buys a suit or handbag from Nordstrom’s, what happens?

Back 47

Mrs. Jones can rest assured that she has good title to the merchandise.
The reasons for this rule: TO PROMOTE COMMERCE AND CONSUMERISM AND TO HONOR BUYER’S REASONABLE EXPECTATIONS.

Front 48

What is default?

Back 48

Default: DEBTOR IS IN BREACH, TYPICALLY FOR FAILURE TO PAY (LOOK TO SECURITY AGREEMENT)

Front 49

What does Article 9 say a creditor can do?

Back 49

A. Self-help repossession
B. Repossession by judicial action
C. Strict Foreclosure
D. Sale
E. Action for deficiency judgment

Front 50

What is self-help repossession, when is it permissible?

Back 50

* Self-help repossession is permissible, so long as CREDITOR DOES NOT BREACH THE PEACE. A breach of the peace occurs when the secured party’s actions are LIKELY TO CAUSE VIOLENCE.
* Thus, the relevant question is not whether or not an actual fight broke out, but whether the secured party did something provocative or likely to cause violence.
* A repossession made over any protest by the debtor, however mild the protest, constitutes a breach of the peace. For that matter, if the repossessor misuses the color of law, by for example impersonating a law enforcement officer, he or she has used CONSTRUCTIVE FORCE and therefore has breached the peace.

Front 51

What are the penalties for a creditor’s misconduct?

Back 51

Civil and criminal penalties attach to creditor’s misconduct.

Front 52

What special rules about collateral in a debtor’s home? What about outside the home?

Back 52

Repossession when the collateral is in debtor’s home: THE HOME ENJOYS A ZONE OF PRIVACY.

SP may not enter debtor’s home without VOLUNTARY AND CONTEMPORANEOUS CONSENT.

Repossession when the collateral is outside the home: MORE LEEWAY

SP may take the collateral so long as there is no DEBTOR OBJECTION.

Front 53

What if I don’t want to chance self-help repossession, what can I do?

Back 53

If the secured party chooses not to resort to self-help repossession, he or she may MAY GO TO COURT TO OBTAIN COURT TO OBTAIN A JUDICIAL WRIT, ordering the sheriff to obtain possession of the collateral and deliver it to the secured party.

Front 54

What is strict foreclosure?

Back 54

Strict foreclosure occurs when the secured party retains the collateral IN FULL SATISFACTION OF THE OUTSTANDING DEBT. In other words, the creditor lawfully retains the collateral and the debt in turn is canceled.

Front 55

Janet Jackson borrows $50,000 from Bank, granting Bank a security interest in Janet’s yacht. Thereafter, she defaults, still owing Bank $44,000. Bank lawfully repossesses the yacht and properly accomplishes strict foreclosure. What does this mean?

Back 55

Bank RETAINS the yacht and the debt is DISCHARGED.

Front 56

How do I strictly foreclose?

Back 56

How to strictly foreclose: To accomplish strict foreclosure, the secured party must send a written proposal to retain the collateral in satisfaction of the debt.

Front 57

To whom is the written proposal for strict foreclosure sent?

Back 57

a. When the collateral is consumer goods, the notice is sent to THE DEBTOR AND ANY SECONDARY OBLIGORS. A secondary obligor is A GUARANTOR OF THE UNDERLYING DEBT.
b. When the collateral is not consumer goods, the notice is sent to THE DEBTOR and OTHER SECURED PARTIES who have told the foreclosing creditor of their security interest in the collateral, as well as PERFECTED SECURED PARTIES, AND SECONDARY OBLIGORS.

Front 58

Donny is the debtor. Marie promises that if Donny cannot pay, she will pay. What is Marie?

Back 58

Marie is THE SECONDARY OBLIGOR.

Front 59

What happens if any of the notified parties objects? When can they object?

Back 59

c. If any of the notified parties objects within 20 days after the notice is sent, strict foreclosure will not be allowed. Instead, the collateral must be disposed of by sale.
PISSANT RULE – DON’T HAVE TO OBJECT FOR CAUSE, CAN OBJECT FOR ANY OLD REASON

Front 60

What special rules apply if we’re talking about a consumer good?

Back 60

Consumer goods and the 60% rule:

If the collateral is consumer goods and the debtor has paid 60% of the loan in the event of a non-PMSI or 60% of the cash price in the event of a PMSI, strict foreclosure is not allowed. Instead, the secured party must sell the collateral within 90 days or be liable in conversion.

Front 61

Prince purchases a $30,000 little red Corvette on credit from Chevrolet. Chevrolet takes a security interest in the car. Chevrolet has A PMSI IN A CONSUMER GOOD After repaying $18,000, Prince defaults. May Chevrolet strictly foreclose?

Back 61

NO, BECAUSE PRINCE HAS ALREADY REPAID 60% OF THE CASH PRICE.
WHY IS THIS JUST? BECAUSE WE DON’T WANT TO AWARD CREDITORS A WINDFALL – ALL THE PRINCIPLE AND ALSO THE COLLATERAL ITSELF.

Front 62

Can the secured party sell the collateral?

Back 62

The secured party may sell the collateral and apply the sale proceeds to the debt. The secured party chooses whether the sale will be public (i.e., a public auction) or private.

Front 63

What are the general rules for selling the collateral?

Back 63

Two governing guideposts:

i. Every aspect of the sale must be: COMMERCIALLY REASONABLE.

ii. Prior to the sale, reasonable notice must be sent.

Front 64

How do we know if notice is reasonable? Is there a shortcut?

Back 64

Notice must be commercially reasonable.
Article 9 provides standard notice forms which, if used, are presumptively COMMERCIALLY REASONABLE.

Front 65

Who do I have to send notice to?

Back 65

a. if the collateral is consumer goods, notice must be sent to DEBTOR AND ANY SECONDARY OBLIGORS.

b. with all other types of collateral, notice must be sent to DEBTOR and those secured parties who have advised the foreclosing creditor of their security interest, as well as PERFECTED SECURED PARTIES AND SECONDARY OBLIGORS.

Front 66

What must the notice contain?

Back 66

c. The content of the notice depends on the type of sale.

If disposition is by public sale, the notice must state THE TIME AND PLACE OF SALE.

If disposition is by private sale, the notice must state the time after which the sale will be made.

For example, “Please be advised that after Feb. 1, 2003, Secured Party will sell the following collateral . . . .”

Front 67

Are there any special notice rules for consumer goods?

Back 67

d. For consumer goods, additional consumer-protective provisions are mandatory, including HOW ANY DEFICIENCY WILL BE CALCULATED and HOW DEBTOR CAN REDEEM THE COLLATERAL

Front 68

How much advance notice is required?

Back 68

There is no bright line. The standard is one of COMMERCIAL REASONABLENESS. However, in a nonconsumer transaction, notice is deemed sent within a reasonable time if it is sent 10 DAYS OR MORE before the time of sale.

Front 69

May the secured party buy at sale?

Back 69

At a public sale, YES

At a private sale, absent external market checks, NO.

Why not? TOO MUCH POTENTIAL FOR UNREGULATED SELF-DEALING.

Front 70

What if I don’t get as much from the sale of the item as the loan was for, can I get the remainder?

Back 70

Yes – this is a deficiency judgment

Front 71

Suppose that the outstanding debt is $100,000, and that the sale of the collateral nets only $60,000 for the secured party. What can the secured party do?

Back 71

Seek a deficiency judgment against the debtor.

Note: If a secured party sells collateral at a low price to an insider buyer, the price that AN INDEPENDENT 3D PARTY WOULD HAVE PAID, rather than the actual amount paid, is the price that will be used in calculating the deficiency.

TO AVOID FRAUD/COLLUSION

Front 72

Can the Debtor get his property back?

Back 72

Possibly – the debtor has a limited right of redemption
i. The debtor’s right to redeem the collateral is cut off once the secured party has RESOLD THE COLLATERAL or completed a STRICT FORECLOSURE.
ii. To redeem, the debtor must pay the amount owed plus: ACCRUED INTEREST AND SECURED PARTY’S REASONABLE EXPENSES INCLUDING ATTORNEY’S FEES.
iii. If the security agreement contains an acceleration clause (which permits the creditor to declare the full balance due in the event of default), to redeem the debtor must: PAY OFF ENTIRE UNPAID BALANCE & ACCRUED INTEREST + SECURED PARTIES REASONABLE EXPENSES INCLUDING ATTORNEY’S FEES..