We often touch on the standard UCC Financing Statement because it is so widely known by the industries we serve, but we wanted to touch on several other situations that are not as generally understood.
Unique Filing Designations
A secured party or creditor that is a consignor, a lessor, a bailor of goods, a licensor, or a buyer of a payment intangible or promissory note may file a UCC using alternate designation terms such as consignor/consignee, lessor/lessee, bailor/bailee, licensor/licensee, or buyer/seller, instead of the terms secured party and debtor. This designation is a simple checkbox at the bottom of the UCC-1 form. These designations may apply when the secured personal property falls under those unique categories. Be sure to select the designation that is appropriate for your transaction.
Note: The filing office will not be able to determine the proper designation to select.
Unique Filing Situations
There are many types of security filings that fall outside the typical UCC Financing Statement used for personal property. It’s important to know what they are, when they are needed and how to get them properly filed. Below we lay out the different types.
- Aircraft: Security interests in aircrafts are perfected by filing an original signed security agreement with the Federal Aviation Administration (FAA) Registry in Oklahoma City. The security interest may also be registered with the International Registry in Dublin to be perfected under international law.
- Boats/Ships/Vessels: It is very important to know the laws of the specific jurisdiction the boat is located. For small vessels, (generally less than 26 feet), a security interest could be perfected by filing with the Secretary of State, the DMV (as with motor vehicles), or even with the Fish Commission (PA). For larger vessels or ships, a “preferred ship mortgage” is filed with the Coast Guard National Vessel Documentation Center in West Virginia.
- Manufactured Home: “Manufactured home” means a pre-fabricated, transportable structure that comes in one or more sections, and when transported, is eight feet or more in width or 40 feet or more in length. Also, when assembled on site, it is 320 or more square feet and is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation. When the UCC1 filing indicates that it is a filing in connection with a manufactured home transaction, it is effective for 30 years instead of the usual 5 years.
- Public-finance Transaction: The “public” part of this filing refers to one of the parties being a public entity, like a secretary of state agency or department. Some characteristics are required for this type of filing, such as debt securities are issued, all or a portion of the securities issued have an initial stated maturity of at least 20 years; and as mentioned, one of the parties like 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.
- Transmitting Utility: Refers to a person or business primarily engaged in the operating of a railroad, subway, street railway, or trolley bus; transmitting communications electrically, electromagnetically, or by light; transmitting goods by pipeline or sewer; or transmitting or producing and transmitting electricity, steam, gas, or water. Filing a UCC with this type of designation will never expire. For it to become ineffective, it will need to be terminated.
- Agricultural Lien: This is a non-consensual lien that applies when the debtor is engaged in farming operations. It means there is an interest in farm goods or services, or performance of operations in connection with operating a farm and whose effectiveness does not depend on the person’s possession of the personal property. It arises when someone provides something to enable the raising of livestock or crops. It is not a security interest, that is the biggest difference between this designation and a regular UCC.
Very few people have dealt with all of these unique filing situations in their work experience.
Our filing team has seen it all and would love to help in your next encounter. Get a quote for your unique filing situation.
NOT INTENDED TO PROVIDE LEGAL, ACCOUNTING, OR OTHER PROFESSIONAL ADVICE AND SHOULD NOT BE RELIED UPON AS SUCH.