Secured Transactions For Texas Bar Exam

Front 1

Article 9 applies to any transaction, __ of its form, which is intended to create a security interest.

Back 1

regardless

Front 2

consignments which must comply with Art 9 are where the consigned goods are worth $__ or more, and the consignor did not use the goods as __ goods.

Back 2

$1,000; consumer

Front 3

Art 9 does not govern true leases of personal property, but does cover a lease that is actually an __ sale.

Back 3

installment

Front 4

The four classifications of "goods" are:

Back 4

• Consumer goods,
• Farm products,
• Equipment,
• Inventory

Front 5

Money is excluded from goods, and so is Oil & Gas before __.

Back 5

extraction

Front 6

which goods classification of goods is the default classification?
i.e., it fits no other definition of goods.

Back 6

Equipment

Front 7

Inventory = goods held for sale or lease, raw materials and works in progress, as well as materials __ in the business.

Back 7

consumed

Front 8

To be a Farm Product, the goods must be:
i) in __ of the farmer engaged in farming operations, and
ii) in an __ condition

Back 8

possession; unmanufactured

Front 9

If the good has multiple uses, its __ use determines its classification.

Back 9

principle

Front 10

bills of lading and warehouse receipts are examples of __.

Back 10

documents

Front 11

David used his truck and computer for collateral for a loan. later he trades his truck for a motorcycle and the computer for cash. The motorcycle and cash are __ of the original collateral.

Back 11

proceeds

note: proceeds may include collateral a creditor could not have otherwise have had a SI in, such as money.

Front 12

The process by which a SI is created and becomes enforceable is called __.

Back 12

attachment

Front 13

Attachment requires three elements:

(VCR)

Back 13

i) Creditor gave VALUE,

ii) a security agreement (CONTRACT)

iii) debtor has RIGHTS in collateral

Front 14

When may the SA be oral?

Back 14

only where the collateral is in SP's POSSESSION

Front 15

__-generic descriptions, such as "all my personal property" are not allowed in the SA.

Back 15

super

Front 16

which type of collateral may not be described by type in the SA?

Back 16

consumer goods and commercial tort claims may not be described by type, the description must be more specific.

Front 17

Would the description, "all my consumer goods" be sufficient collateral description in the SA?

Back 17

no

Front 18

An after-acquired property clause in consumer goods will only work to cover consumer goods acquired w/in ___ of the creditor giving value.

Back 18

10-days

Front 19

after-acquired property clauses never work for __ __ claims.

Back 19

commercial tort

Front 20

Perfection requires:
i) __, and
ii) one of the methods of perfection

Back 20

attachment

Front 21

A financing statement is good for __ from date of filing.

Back 21

5-years

Front 22

a "continuation statement" must be filled w/in __ months prior to the expiration date and before the 5 years expires in order to have continuous perfection.

Back 22

6

Front 23

the minimum penalty for the filing of a fraudulent financing statement is $__.

Back 23

$5000 plus costs and atty fees

Front 24

Automatic Permanent Perfection exists for PMSI's in __ __.

Back 24

consumer goods

Front 25

Note: Automatic permanent perfection for PMSI in consumer goods does not apply to either certificate of title items or __.

Back 25

fixtures

Front 26

waiver of notice for the sale of the collateral or the right to redemption must be given __ default.

Back 26

AFTER

*NO waiver of notice allowed in the SA.

Front 27

What is the rule for an after acquired property clause in consumer goods?

Back 27

the after acquired property clause will only cover consumer goods acquired w/in 10 days of the creditor giving value.

Front 28

When can a security agreement be made orally?

Back 28

a security agreement may be oral ONLY if the collateral is in the SP possession.

Front 29

for a SI to be enforceable against the ∆, the SI must "__" to the collateral.

Back 29

ATTACH

Front 30

for a SI to be enforceable against the ∆, the SI must "ATTACH" to the collateral. Attachment requires:

Back 30

(i) that the creditor give VALUE,
(ii) the ∆ must have RIGHTS in the collateral, and
(iii) one of the following:
• a security agreement describing the collateral and authenticated by the debtor;
• SP has possession of the collateral pursuant to the ∆’s agreement.
• SP has control of a business deposit account or investment property pursuant to the ∆’s agreement.

Front 31

Attachment requires:

Back 31

(i) the creditor gave VALUE
(ii) the ∆ has RIGHTS in the collateral, and
(iii) either:
• valid Security Agreement;
• Possession by creditor;
• Control by creditor

Front 32

value is given by accepting delivery pursuant to a pre-existing contract for purchase, or generally, in return for any consideration sufficient to support a simple contract.

Back 32

Thus Value can be:

• consideration, or

• delivery pursuant to a pre-existing contract for purchase

Front 33

BIOC rule does NOT apply to what type of goods?

Back 33

farm products

*the BIOC rule does NOT apply to FARM PRODUCTS