The UCC is a comprehensive modernization of various statutes relating to commercial transactions including sales, leases, negotiable instruments, bank deposits and collections, funds transfers, letters of credit, bulk sales, documents of title, investment securities, and secured transactions.
The Permanent Editorial Board for the UCC, a joint committee of ALI and the Uniform Law Commission, assists in attaining and maintaining uniformity in state statutes governing commercial transactions by discouraging non-uniform amendments to the UCC by the states, and by approving and promulgating amendments to the UCC when necessary. Visit the PEB page for recent PEB commentaries and other documents.
A volume of the complete text of the UCC is available for purchase from Thomson Reuters.
UCC material in both draft and final form is copyrighted. A license is required for the reproduction of the final form of UCC material. Request reprint permission.
This report explains the application of UCC Articles 3 and 9 to provide guidance in (i) identifying the person who is entitled to enforce the payment obligation of the maker of a mortgage note, and to whom the maker owes that obligation; and (ii) determining who owns the rights represented by the note and mortgage.
PEB Report on Application of the UCC to Selected Issues Relating to Mortgage Notes (corrected 11/16/2011)
Electronic | 1UCCNOV11E | 2011 | 17 pages
Issues relating to the transfer, ownership, and enforcement of mortgage notes are primarily governed by two Articles of the UCC: (1) in cases in which the mortgage note is a negotiable instrument, Article 3 provides rules governing the obligations of parties on the note and the enforcement of those obligations; and (2) in cases involving either negotiable or non-negotiable notes, Article 9 contains important rules governing how ownership of those notes may be transferred, the effect of the transfer of ownership of the notes on the ownership of the mortgages securing those notes, and the right of the transferee, under certain circumstances, to record its interest in the mortgage in the applicable real estate recording office.
This is the final version of the amendments to Article 9 of the UCC after approval by both the ALI and the ULC.
Electronic | 1UCCPFTE | 2010 | 129 pages
Part one
Amendments to the official text and related comments
Section 9-102. Definitions and index of definitions
Section 9-105. Control of electronic chattel paper
Section 9-307. Location of debtor
Section 9-311. Perfection of security interests in property subject to certain statutes, regulations, and treaties.
Section 9-316. Continued perfection of security interest following effect of change in governing law
Section 9-317. Interests that take priority over or take free of security interest or agricultural lien
Section 9-326. Priority of security interests created by new debtor
Section 9-406. Discharge of account debtor; notification of assignment; identification and proof of assignment; restrictions on assignment of accounts, chattel paper, payment intangibles, and promissory notes ineffective
Section 9-408. Restrictions on assignment of promissory notes, health-care-insurance receivables, and certain general intangibles ineffective
Section 9-502. Contents of financing statement; record of
mortgage as financing statement; time of filing financing statement
Section 9-503. Name of debtor and secured party
Section 9-507. Effect of certain events on effectiveness of financing statement
Section 9-515. Duration and effectiveness of financing statement; effect of lapsed financing statement
Section 9-516. What constitutes filing; effectiveness of filing.
Section 9-518. Claim concerning inaccurate or wrongfully filed record
Section 9-521. Uniform form of written financing statement and amendment
Section 9-607. Collection and enforcement by secured party
Section 9-801. Effective date
Section 9-802. Savings clause
Section 9-803. Security interest perfected before effective date
Section 9-804. Security interest unperfected before effective date
Section 9-805. Effectiveness of action taken before effective date
section 9-806. When initial financing statement suffices to continue effectiveness of financing statement.
Section 9-807. Amendment of pre-effective-date financing
statement
Section 9-808. Persons entitled to file initial financing statement or continuation statement
Section 9-809. Priority
Part Two
Modifications to the comments unaccompanied by amendments to the official text section 9-102. Definitions and index of definitions
Section 9-104. Control of deposit account
Section 9-109. Scope
Section 9-301. Law governing perfection and priority of security interests
Section 9-501. Filing office
Section 9-307. Location of debtor
Section 9-322. Priorities among conflicting security interests in and agricultural liens on same collateral
section 9-509. Persons entitled to file a record
Section 9-322. Priorities among conflicting security interests in and agricultural liens on same collateral
Section 9-326. Priority of security interests created by new debtor
Section 9-330. Priority of purchaser of chattel paper or instrument
Section 9-509. Persons entitled to file a record
Section 9-512. Amendment of financing statement
Section 9-602. Waiver and variance of rights and duties
Section 9-610. Disposition of collateral after default
Section 9-624. Waiver
Section 9-610. Disposition of collateral after default
Section 9-611. Notification before disposition of collateral.
Section 9-613. Contents and form of notification before disposition of collateral: general
Section 9-616. Explanation of calculation of surplus or deficiency
Section 9-621. Notification of proposal to accept collateral
Section 9-625. Remedies for secured party’s failure to comply with article
Section 9-706. When initial financing statement suffices to continue effectiveness of financing statement
Section 8-103. Rules for determining whether certain obligations and interests are securities or financial assets article 11: effective date and transition provisions
UNIFORM COMMERCIAL CODE AND EMERGING TECHNOLOGIES
TABLE OF CONTENTS
Reporter’s Prefatory Note to April 11, 2022 Draft ................ 1
ARTICLE 1
GENERAL PROVISIONS
Section 1-103. Construction of [Uniform Commercial Code]
to Promote its Purposes and Policies; Applicability of Supplemental Principles of Law ........................................... 6
Section 1-107. Section Captions .......................................... 7
Section 1-201. General Definitions ...................................... 8
Section 1-204. Value .......................................................... 16
ARTICLE 2
SALES
Section 2-102. Scope; Certain Security and Other Transactions Excluded from this Article ............................. 16
Section 2-106. Definitions: “Contract”; “Agreement”;
“Contract for Sale”; “Sale”; “Present Sale”; “Conforming”
to Contract; “Termination”; “Cancellation”; “Hybrid Transaction” ....................................................................... 21
Section 2-201. Formal Requirements; Statute of Frauds ... 24
Section 2-202. Final Written Expression: Parol or
Extrinsic Evidence .............................................................. 26
Section 2-207. Additional Terms in Acceptance or Confirmation ....................................................................... 29
Section 2-209. Modification, Rescission and Waiver ......... 29
Section 2-316. Exclusion or Modification of Warranties ..... 30
Section 2-605. Waiver of Buyer’s Objections by Failure
to Particularize .................................................................... 30
Section 2-607. Effect of Acceptance; Notice of Breach; Burden of Establishing Breach After Acceptance; Notice
of Claim or Litigation to Person Answerable Over .............. 31
Section 2-609. Right to Adequate Assurance of
Performance ....................................................................... 31
Section 2-616. Procedure on Notice Claiming Excuse ...... 31
Section 2-702. Seller’s Remedies on Discovery of
Buyer’s Insolvency ............................................................. 32
ARTICLE 2A
LEASES
Section 2A-102. Scope ....................................................... 32
Section 2A-103. Definitions and Index of Definitions ......... 34
Section 2A-107. Waiver or Renunciation of Claim or
Right After Default .............................................................. 36
Section 2A-201. Statute of Frauds ..................................... 36
Section 2A-202. Final Written Expression: Parol or
Extrinsic Evidence .............................................................. 38
Section 2A-203. Seals Inoperative ..................................... 39
Section 2A-205. Firm Offers ............................................... 39
Section 2A-208. Modification, Rescission and Waiver ....... 39
Section 2A-214. Exclusion or Modification of Warranties ... 40
Section 2A-303. Alienability of Party’s Interest Under
Lease Contract or of Lessor’s Residual Interest in Goods; Delegation of Performance; Transfer of Rights .................. 40
Section 2A-309. Lessor’s and Lessee’s Rights When
Goods Become Fixtures ..................................................... 40
Section 2A-310. Lessor’s and Lessee’s Rights When
Goods Become Accessions ................................................ 41
Section 2A-401. Insecurity: Adequate Assurance of Performance ....................................................................... 41
Section 2A-406. Procedure on Excused Performance ....... 41
Section 2A-514. Waiver of Lessee’s Objections ................ 41
Section 2A-516. Effect of Acceptance of Goods; Notice of Default; Burden of Establishing Default After Acceptance; Notice of Claim or Litigation to Person Answerable Over .. 42
Reporter’s Prefatory Note to Payments Amendments ....... 42
ARTICLE 3
NEGOTIABLE INSTRUMENTS
Section 3-104. Negotiable Instrument ................................ 43
Section 3-105. Issue of Instrument .................................... 44
Section 3-309. Enforcement of Lost, Destroyed, or Stolen Instrument .......................................................................... 45
Section 3-604. Discharge by Cancellation or
Renunciation ...................................................................... 46
ARTICLE 4
BANK DEPOSITS AND COLLECTIONS
Section 4-207. Transfer Warranties .................................... 47
ARTICLE 4A
FUNDS TRANSFERS
Section 4A-103. Payment Order ‒ Definitions ................... 47
Section 4A-104. Funds Transfer ‒ Definitions .................... 48
Section 4A-201. Security Procedure .................................. 50
Section 4A-202. Authorized and Verified Payment
Orders ................................................................................ 51
Section 4A-203. Unenforceability of Certain Verified
Payment Orders ................................................................. 52
Section 4A-206. Transmission of Payment Order Through Funds-Transfer or Other Communication System .............. 56
Section 4A-207. Misdescription of Beneficiary ................... 56
Section 4A-208. Misdescription of Intermediary Bank or Beneficiary’s Bank .............................................................. 57
Section 4A-210. Rejection of Payment Order .................... 58
Section 4A-211. Cancellation and Amendment of
Payment Order ................................................................... 59
ARTICLE 5
LETTERS OF CREDIT
Section 5-116. Choice of Law and Forum .......................... 59
ARTICLE 7
DOCUMENTS OF TITLE
Section 7-102. Definitions and Index of Definitions ............ 61
Section 7-106. Control of Electronic Document of Title ...... 63
Section 7-403. Obligation of Bailee to Deliver; Excuse ...... 66
Section 7-504. Rights Acquired in Absence of Due Negotiation; Effect of Diversion; Stoppage of Delivery ....... 68
ARTICLE 8
INVESTMENT SECURITIES
Reporter’s Prefatory Note to Article 8 Amendments ........... 69
Section 8-102. Definitions and Index of Definitions ............ 70
Section 8-106. Control ........................................................ 73
Section 8-303. Protected Purchaser .................................. 74
Section 8-501. Securities Account; Acquisition of Security Entitlement from Securities Intermediary ........................... 75
Section 8-505. Duty of Securities Intermediary with
Respect to Payments and Distributions ............................. 77
ARTICLE 9
SECURED TRANSACTIONS
Reporter’s Prefatory Note to Article 9 Amendments ........... 78
Section 9-102. Definitions and Index of Definitions ............ 80
Section 9-104. Control of Deposit Account ........................ 92
Section 9-105. Control of Electronic Chattel Paper ........... 93
Section 9-105. Control of Electronic Copy of Record Evidencing Chattel Paper ................................................... 94
Section 9-105A. Control of Electronic Money. .................... 97
Section 9-107A. Control of Controllable Electronic
Record, Controllable Account, or ControllablePayment Intangible ............................................................................ 99
Section 9-107B. No Requirement to Acknowledge or Confirm; No Duties ........................................................... 100
Section 9-203. Attachment and Enforceability of Security Interest; Proceeds; Supporting Obligations; Formal Requisites ......................................................................... 101
Section 9-204. After-Acquired Property; Future
Advances .......................................................................... 102
Section 9-207. Rights and Duties of Secured Party
Having Possession or Control of Collateral ...................... 104
Section 9-208. Additional Duties of Secured Party
Having Control of Collateral ............................................. 104
Section 9-301. Law Governing Perfection and Priority
of Security Interests .......................................................... 107
Section 9-306A. Law Governing Perfection and Priority
of Security Interests in Chattel Paper ............................... 108
Section 9-306B. Law Governing Perfection and Priority
of Security Interests in ControllableAccounts,
Controllable Electronic Records, and Controllable
Payment Intangibles ......................................................... 111
Section 9-310. When Filing Required to Perfect Security Interest or Agricultural Lien; Security Interests and Agricultural Liens to Which Filing Provisions Do Not
Apply ................................................................................. 112
Section 9-312. Perfection of Security Interests in Chattel Paper, Controllable Accounts,Controllable Electronic Records, Controllable Payment Intangibles, Deposit Accounts, Negotiable Documents, Goods Covered by Documents, Instruments, Investment Property, Letter-of-Credit Rights, and Money; Perfection by Permissive Filing; Temporary Perfection Without Filing or Transfer of Possession ....................................................................... 113
Section 9-313. When Possession by or Delivery to
Secured Party Perfects Security Interest Without Filing ... 116
Section 9-314. Perfection by Control ................................ 117
Section 9-314A. Perfection by Possession and Control of Chattel Paper .................................................................... 118
Section 9-316. Continued Perfection of Security Interest Following Change in Governing Law ................................ 119
Section 9-317. Interests That Take Priority Over or Take
Free of Security Interest or Agricultural Lien .................... 121
Section 9-326A. Priority of Security Interests in
Controllable Account, Controllable ElectronicRecord,
and Controllable Payment Intangible ............................... 123
Section 9-330. Priority of Purchaser of Chattel Paper or Instrument ........................................................................ 124
Section 9-331. Priority of Rights of Purchasers of Controllable Accounts, Controllable ElectronicRecords, Controllable Payment Intangibles,Instruments,
Documents, Instruments, and Securities Under Other Articles; Priority of Interests in Financial Assets and
Security Entitlements and Protections Against Assertions
of Claims Under Article 8Articles 8 and12 ...................... 125
Section 9-332. Transfer of Money; Transfer of Funds
from Deposit Account ....................................................... 126
Section 9-406. Discharge of Account Debtor; Notification
of Assignment; Identification and Proof of Assignment; Restrictions on Assignment of Accounts, Chattel Paper, Payment Intangibles, and Promissory Notes Ineffective .. 128
Section 9-601. Rights After Default; Judicial Enforcement; Consignor or Buyer of Accounts, Chattel Paper, Payment Intangibles, or Promissory Notes ..................................... 130
Section 9-605. Unknown Debtor or Secondary Obligor ... 130
Section 9-610. Disposition of Collateral After Default ...... 132
Section 9-611. Notification Before Disposition of
Collateral .......................................................................... 135
Section 9-614. Contents and Form of Notification
Before Disposition of Collateral: Consumer-Goods Transaction ....................................................................... 137
Section 9-616. Explanation of Calculation of Surplus or Deficiency ......................................................................... 139
Section 9-627. Determination of Whether Conduct Was Commercially Reasonable ............................................... 142
Section 9-628. Nonliability and Limitation on Liability of Secured Party; Liability of Secondary Obligor .................. 142
ARTICLE 12
CONTROLLABLE ELECTRONIC RECORDS
Reporter’s Prefatory Note to Article 12 ............................. 144
Section 12-101. Title ......................................................... 150
Section 12-102. Definitions .............................................. 150
Section 12-103. Relationship to Article 9 and Consumer Laws ................................................................................. 152
Section 12-104. Rights in Controllable Account,
Controllable Electronic Record, and Controllable
Payment Intangible ........................................................... 152
Section 12-105. Control of Controllable Electronic
Record .............................................................................. 158
Section 12-106. Discharge of Account Debtor on
Controllable Account or Controllable Payment
Intangible .......................................................................... 164
Section 12-107. Governing Law ....................................... 168
ANNEX A
TRANSITION PROVISIONS FOR 2022 AMENDMENTS TO UNIFORM COMMERCIAL CODE—EMERGING TECHNOLOGIES
Reporter’s Prefatory Note to Annex A—Transition
Provisions ...................................................................... 173
PART 1
GENERAL PROVISIONS
Section A-101. Effective Date ........................................... 173
Section A-102. Definitions ................................................ 174
PART 2
GENERAL TRANSITION PROVISION
Section A-201. [Savings Clause.] ..................................... 175
PART 3
ADDITIONAL TRANSITION PROVISIONS FOR ARTICLES 9 AND 12
Section A-301. Savings Clause ........................................ 176
Section A-302. Security Interest Perfected Before
Effective Date ................................................................... 177
Section A-303. Security Interest Unperfected Before
Effective Date ................................................................... 180
Section A-304. Effectiveness of Actions Taken Before Effective Date ................................................................... 181
Section A-305. Priority ...................................................... 183
Section A-306. Priority of Claims When Priority Rules of Article 9 Do Not Apply ...................................................... 186
Tentative Draft No. 1 contains draft amendments to Articles 1, 2, 2A, 3, 4, 4A, 5, 7, 8, and 9; draft Article 12; and transition provisions. The membership voted to approve the Tentative Draft at the 2022 Annual Meeting, subject to the discussion at the Meeting and editorial prerogative. This is a joint project with the Uniform Law Commission (ULC) that will be presented for approval at the ULC Annual Meeting in summer 2022.
UNIFORM COMMERCIAL CODE AND EMERGING TECHNOLOGIES
TABLE OF CONTENTS
Reporter’s Prefatory Note to April 11, 2022 Draft ................ 1
ARTICLE 1
GENERAL PROVISIONS
Section 1-103. Construction of [Uniform Commercial Code]
to Promote its Purposes and Policies; Applicability of Supplemental Principles of Law ........................................... 6
Section 1-107. Section Captions .......................................... 7
Section 1-201. General Definitions ...................................... 8
Section 1-204. Value .......................................................... 16
ARTICLE 2
SALES
Section 2-102. Scope; Certain Security and Other Transactions Excluded from this Article ............................. 16
Section 2-106. Definitions: “Contract”; “Agreement”;
“Contract for Sale”; “Sale”; “Present Sale”; “Conforming”
to Contract; “Termination”; “Cancellation”; “Hybrid Transaction” ....................................................................... 21
Section 2-201. Formal Requirements; Statute of Frauds ... 24
Section 2-202. Final Written Expression: Parol or
Extrinsic Evidence .............................................................. 26
Section 2-207. Additional Terms in Acceptance or Confirmation ....................................................................... 29
Section 2-209. Modification, Rescission and Waiver ......... 29
Section 2-316. Exclusion or Modification of Warranties ..... 30
Section 2-605. Waiver of Buyer’s Objections by Failure
to Particularize .................................................................... 30
Section 2-607. Effect of Acceptance; Notice of Breach; Burden of Establishing Breach After Acceptance; Notice
of Claim or Litigation to Person Answerable Over .............. 31
Section 2-609. Right to Adequate Assurance of
Performance ....................................................................... 31
Section 2-616. Procedure on Notice Claiming Excuse ...... 31
Section 2-702. Seller’s Remedies on Discovery of
Buyer’s Insolvency ............................................................. 32
ARTICLE 2A
LEASES
Section 2A-102. Scope ....................................................... 32
Section 2A-103. Definitions and Index of Definitions ......... 34
Section 2A-107. Waiver or Renunciation of Claim or
Right After Default .............................................................. 36
Section 2A-201. Statute of Frauds ..................................... 36
Section 2A-202. Final Written Expression: Parol or
Extrinsic Evidence .............................................................. 38
Section 2A-203. Seals Inoperative ..................................... 39
Section 2A-205. Firm Offers ............................................... 39
Section 2A-208. Modification, Rescission and Waiver ....... 39
Section 2A-214. Exclusion or Modification of Warranties ... 40
Section 2A-303. Alienability of Party’s Interest Under
Lease Contract or of Lessor’s Residual Interest in Goods; Delegation of Performance; Transfer of Rights .................. 40
Section 2A-309. Lessor’s and Lessee’s Rights When
Goods Become Fixtures ..................................................... 40
Section 2A-310. Lessor’s and Lessee’s Rights When
Goods Become Accessions ................................................ 41
Section 2A-401. Insecurity: Adequate Assurance of Performance ....................................................................... 41
Section 2A-406. Procedure on Excused Performance ....... 41
Section 2A-514. Waiver of Lessee’s Objections ................ 41
Section 2A-516. Effect of Acceptance of Goods; Notice of Default; Burden of Establishing Default After Acceptance; Notice of Claim or Litigation to Person Answerable Over .. 42
Reporter’s Prefatory Note to Payments Amendments ....... 42
ARTICLE 3
NEGOTIABLE INSTRUMENTS
Section 3-104. Negotiable Instrument ................................ 43
Section 3-105. Issue of Instrument .................................... 44
Section 3-309. Enforcement of Lost, Destroyed, or Stolen Instrument .......................................................................... 45
Section 3-604. Discharge by Cancellation or
Renunciation ...................................................................... 46
ARTICLE 4
BANK DEPOSITS AND COLLECTIONS
Section 4-207. Transfer Warranties .................................... 47
ARTICLE 4A
FUNDS TRANSFERS
Section 4A-103. Payment Order ‒ Definitions ................... 47
Section 4A-104. Funds Transfer ‒ Definitions .................... 48
Section 4A-201. Security Procedure .................................. 50
Section 4A-202. Authorized and Verified Payment
Orders ................................................................................ 51
Section 4A-203. Unenforceability of Certain Verified
Payment Orders ................................................................. 52
Section 4A-206. Transmission of Payment Order Through Funds-Transfer or Other Communication System .............. 56
Section 4A-207. Misdescription of Beneficiary ................... 56
Section 4A-208. Misdescription of Intermediary Bank or Beneficiary’s Bank .............................................................. 57
Section 4A-210. Rejection of Payment Order .................... 58
Section 4A-211. Cancellation and Amendment of
Payment Order ................................................................... 59
ARTICLE 5
LETTERS OF CREDIT
Section 5-116. Choice of Law and Forum .......................... 59
ARTICLE 7
DOCUMENTS OF TITLE
Section 7-102. Definitions and Index of Definitions ............ 61
Section 7-106. Control of Electronic Document of Title ...... 63
Section 7-403. Obligation of Bailee to Deliver; Excuse ...... 66
Section 7-504. Rights Acquired in Absence of Due Negotiation; Effect of Diversion; Stoppage of Delivery ....... 68
ARTICLE 8
INVESTMENT SECURITIES
Reporter’s Prefatory Note to Article 8 Amendments ........... 69
Section 8-102. Definitions and Index of Definitions ............ 70
Section 8-106. Control ........................................................ 73
Section 8-303. Protected Purchaser .................................. 74
Section 8-501. Securities Account; Acquisition of Security Entitlement from Securities Intermediary ........................... 75
Section 8-505. Duty of Securities Intermediary with
Respect to Payments and Distributions ............................. 77
ARTICLE 9
SECURED TRANSACTIONS
Reporter’s Prefatory Note to Article 9 Amendments ........... 78
Section 9-102. Definitions and Index of Definitions ............ 80
Section 9-104. Control of Deposit Account ........................ 92
Section 9-105. Control of Electronic Chattel Paper ........... 93
Section 9-105. Control of Electronic Copy of Record Evidencing Chattel Paper ................................................... 94
Section 9-105A. Control of Electronic Money. .................... 97
Section 9-107A. Control of Controllable Electronic
Record, Controllable Account, or ControllablePayment Intangible ............................................................................ 99
Section 9-107B. No Requirement to Acknowledge or Confirm; No Duties ........................................................... 100
Section 9-203. Attachment and Enforceability of Security Interest; Proceeds; Supporting Obligations; Formal Requisites ......................................................................... 101
Section 9-204. After-Acquired Property; Future
Advances .......................................................................... 102
Section 9-207. Rights and Duties of Secured Party
Having Possession or Control of Collateral ...................... 104
Section 9-208. Additional Duties of Secured Party
Having Control of Collateral ............................................. 104
Section 9-301. Law Governing Perfection and Priority
of Security Interests .......................................................... 107
Section 9-306A. Law Governing Perfection and Priority
of Security Interests in Chattel Paper ............................... 108
Section 9-306B. Law Governing Perfection and Priority
of Security Interests in ControllableAccounts,
Controllable Electronic Records, and Controllable
Payment Intangibles ......................................................... 111
Section 9-310. When Filing Required to Perfect Security Interest or Agricultural Lien; Security Interests and Agricultural Liens to Which Filing Provisions Do Not
Apply ................................................................................. 112
Section 9-312. Perfection of Security Interests in Chattel Paper, Controllable Accounts,Controllable Electronic Records, Controllable Payment Intangibles, Deposit Accounts, Negotiable Documents, Goods Covered by Documents, Instruments, Investment Property, Letter-of-Credit Rights, and Money; Perfection by Permissive Filing; Temporary Perfection Without Filing or Transfer of Possession ....................................................................... 113
Section 9-313. When Possession by or Delivery to
Secured Party Perfects Security Interest Without Filing ... 116
Section 9-314. Perfection by Control ................................ 117
Section 9-314A. Perfection by Possession and Control of Chattel Paper .................................................................... 118
Section 9-316. Continued Perfection of Security Interest Following Change in Governing Law ................................ 119
Section 9-317. Interests That Take Priority Over or Take
Free of Security Interest or Agricultural Lien .................... 121
Section 9-326A. Priority of Security Interests in
Controllable Account, Controllable ElectronicRecord,
and Controllable Payment Intangible ............................... 123
Section 9-330. Priority of Purchaser of Chattel Paper or Instrument ........................................................................ 124
Section 9-331. Priority of Rights of Purchasers of Controllable Accounts, Controllable ElectronicRecords, Controllable Payment Intangibles,Instruments,
Documents, Instruments, and Securities Under Other Articles; Priority of Interests in Financial Assets and
Security Entitlements and Protections Against Assertions
of Claims Under Article 8Articles 8 and12 ...................... 125
Section 9-332. Transfer of Money; Transfer of Funds
from Deposit Account ....................................................... 126
Section 9-406. Discharge of Account Debtor; Notification
of Assignment; Identification and Proof of Assignment; Restrictions on Assignment of Accounts, Chattel Paper, Payment Intangibles, and Promissory Notes Ineffective .. 128
Section 9-601. Rights After Default; Judicial Enforcement; Consignor or Buyer of Accounts, Chattel Paper, Payment Intangibles, or Promissory Notes ..................................... 130
Section 9-605. Unknown Debtor or Secondary Obligor ... 130
Section 9-610. Disposition of Collateral After Default ...... 132
Section 9-611. Notification Before Disposition of
Collateral .......................................................................... 135
Section 9-614. Contents and Form of Notification
Before Disposition of Collateral: Consumer-Goods Transaction ....................................................................... 137
Section 9-616. Explanation of Calculation of Surplus or Deficiency ......................................................................... 139
Section 9-627. Determination of Whether Conduct Was Commercially Reasonable ............................................... 142
Section 9-628. Nonliability and Limitation on Liability of Secured Party; Liability of Secondary Obligor .................. 142
ARTICLE 12
CONTROLLABLE ELECTRONIC RECORDS
Reporter’s Prefatory Note to Article 12 ............................. 144
Section 12-101. Title ......................................................... 150
Section 12-102. Definitions .............................................. 150
Section 12-103. Relationship to Article 9 and Consumer Laws ................................................................................. 152
Section 12-104. Rights in Controllable Account,
Controllable Electronic Record, and Controllable
Payment Intangible ........................................................... 152
Section 12-105. Control of Controllable Electronic
Record .............................................................................. 158
Section 12-106. Discharge of Account Debtor on
Controllable Account or Controllable Payment
Intangible .......................................................................... 164
Section 12-107. Governing Law ....................................... 168
ANNEX A
TRANSITION PROVISIONS FOR 2022 AMENDMENTS TO UNIFORM COMMERCIAL CODE—EMERGING TECHNOLOGIES
Reporter’s Prefatory Note to Annex A—Transition
Provisions ...................................................................... 173
PART 1
GENERAL PROVISIONS
Section A-101. Effective Date ........................................... 173
Section A-102. Definitions ................................................ 174
PART 2
GENERAL TRANSITION PROVISION
Section A-201. [Savings Clause.] ..................................... 175
PART 3
ADDITIONAL TRANSITION PROVISIONS FOR ARTICLES 9 AND 12
Section A-301. Savings Clause ........................................ 176
Section A-302. Security Interest Perfected Before
Effective Date ................................................................... 177
Section A-303. Security Interest Unperfected Before
Effective Date ................................................................... 180
Section A-304. Effectiveness of Actions Taken Before Effective Date ................................................................... 181
Section A-305. Priority ...................................................... 183
Section A-306. Priority of Claims When Priority Rules of Article 9 Do Not Apply ...................................................... 186
Tentative Draft No. 1 contains draft amendments to Articles 1, 2, 2A, 3, 4, 4A, 5, 7, 8, and 9; draft Article 12; and transition provisions. The membership voted to approve the Tentative Draft at the 2022 Annual Meeting, subject to the discussion at the Meeting and editorial prerogative. This is a joint project with the Uniform Law Commission (ULC) that will be presented for approval at the ULC Annual Meeting in summer 2022.