Chapter 409

409.409 409.409 Restrictions on assignment of letter-of-credit rights ineffective.

409.409(1) (1) Term or law restricting assignment generally ineffective. A term in a letter of credit or a rule of law, statute, rule, custom, or practice applicable to the letter of credit which prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary’s assignment of or creation of a security interest in a letter-of-credit right is ineffective to the extent that the term or rule of law, statute, rule, custom, or practice:

409.409(1)(a) (a) Would impair the creation, attachment, or perfection of a security interest in the letter-of-credit right; or

409.409(1)(b) (b) Provides that the assignment or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the letter-of-credit right.

409.409(2) (2) Limitation on ineffectiveness under sub. (1). To the extent that a term in a letter of credit is ineffective under sub. (1) but would be effective under law other than this chapter or a custom or practice applicable to the letter of credit, to the transfer of a right to draw or otherwise demand performance under the letter of credit, or to the assignment of a right to proceeds of the letter of credit, the creation, attachment, or perfection of a security interest in the letter-of-credit right:

409.409(2)(a) (a) Is not enforceable against the applicant, issuer, nominated person, or transferee beneficiary;

409.409(2)(b) (b) Imposes no duties or obligations on the applicant, issuer, nominated person, or transferee beneficiary; and

409.409(2)(c) (c) Does not require the applicant, issuer, nominated person, or transferee beneficiary to recognize the security interest, pay or render performance to the secured party, or accept payment or other performance from the secured party.

409.409 History History: 2001 a. 10.

subch. V of ch. 409 SUBCHAPTER V

FILING

409.501 409.501 Filing office.

409.501(1) (1) Filing offices. Except as otherwise provided in sub. (2), if the local law of this state governs perfection of a security interest or agricultural lien, the office in which to file a financing statement to perfect the security interest or agricultural lien is:

409.501(1)(a) (a) The office designated for the filing or recording of a record of a mortgage on the related real property, if:

409.501(1)(a)1. 1. The collateral is as-extracted collateral or timber to be cut; or

409.501(1)(a)2. 2. The financing statement is filed as a fixture filing and the collateral is goods that are or are to become fixtures; or

409.501(1)(b) (b) The office of the department of financial institutions or any office duly authorized by the department, in all other cases, including a case in which the collateral is goods that are or are to become fixtures and the financing statement is not filed as a fixture filing.

409.501(2) (2) Filing office for transmitting utilities. The office in which to file a financing statement to perfect a security interest in collateral, including fixtures, of a transmitting utility is the office of the department of financial institutions. The financing statement also constitutes a fixture filing as to the collateral indicated in the financing statement which is or is to become fixtures.

409.501 History History: 2001 a. 10.

409.502 409.502 Contents of financing statement; record of mortgage as financing statement; time of filing financing statement.

409.502(1) (1) Sufficiency of financing statement. Subject to sub. (2), a financing statement is sufficient only if it:

409.502(1)(a) (a) Provides the name of the debtor;

409.502(1)(b) (b) Provides the name of the secured party or a representative of the secured party; and

409.502(1)(c) (c) Indicates the collateral covered by the financing statement.

409.502(2) (2) Real-property-related financing statements. Except as otherwise provided in s. 409.501 (2), to be sufficient, a financing statement that covers as-extracted collateral or timber to be cut, or which is filed as a fixture filing and covers goods that are or are to become fixtures, must satisfy sub. (1) and also:

409.502(2)(a) (a) Indicate that it covers this type of collateral;

409.502(2)(b) (b) Indicate that it is to be filed for record in the real property records;

409.502(2)(c) (c) Provide a description of the real property to which the collateral is related sufficient to give constructive notice of a mortgage under the law of this state if the description were contained in a record of the mortgage of the real property; and

409.502(2)(d) (d) If the debtor does not have an interest of record in the real property, provide the name of a record owner.

409.502(3) (3) Record of mortgage as financing statement. A record of a mortgage is effective, from the date of recording, as a financing statement filed as a fixture filing or as a financing statement covering as-extracted collateral or timber to be cut only if:

409.502(3)(a) (a) The record indicates the goods or accounts that it covers;

409.502(3)(b) (b) The goods are or are to become fixtures related to the real property described in the record or the collateral is related to the real property described in the record and is as-extracted collateral or timber to be cut;

409.502(3)(c) (c) The record satisfies the requirements for a financing statement in this section, but:

409.502(3)(c)1. 1. The record need not indicate that it is to be filed in the real property records; and

409.502(3)(c)2. 2. The record sufficiently provides the name of a debtor who is an individual if it provides the individual name of the debtor or the surname and first personal name of the debtor, even if the debtor is an individual to whom s. 409.503 (1) (dm) applies; and

409.502(3)(d) (d) The record is duly recorded.

409.502(4) (4) Filing before security agreement or attachment. A financing statement may be filed before a security agreement is made or a security interest otherwise attaches.

409.502 History History: 2001 a. 10; 2011 a. 206.

409.502 Annotation Financing Statements Under Revised UCC Article 9. Ireland. Wis. Law. Aug. 2001.

409.503 409.503 Name of debtor and secured party.

409.503(1) (1) Sufficiency of debtor’s name. A financing statement sufficiently provides the name of the debtor:

409.503(1)(a) (a) Except as otherwise provided in par. (c), if the debtor is a registered organization or the collateral is held in a trust that is a registered organization, only if the financing statement provides the name that is stated to be the registered organization’s name on the public organic record most recently filed with or issued or enacted by the registered organization’s jurisdiction of organization which purports to state, amend, or restate the registered organization’s name;

409.503(1)(b) (b) Subject to sub. (6), if the collateral is being administered by the personal representative of a decedent, only if the financing statement provides, as the name of the debtor, the name of the decedent and, in a separate part of the financing statement, indicates that the collateral is being administered by a personal representative;

409.503(1)(c) (c) If the collateral is held in a trust that is not a registered organization, only if the financing statement:

409.503(1)(c)1m. 1m. Provides, as the name of the debtor:

409.503(1)(c)1m.a. a. If the organic record of the trust specifies a name for the trust, the name specified; or

409.503(1)(c)1m.b. b. If the organic record of the trust does not specify a name for the trust, the name of the settlor or testator; and

409.503(1)(c)2m. 2m. In a separate part of the financing statement:

409.503(1)(c)2m.a. a. If the name is provided in accordance with subd. 1m. a., indicates that the collateral is held in a trust; or

409.503(1)(c)2m.b. b. If the name is provided in accordance with subd. 1m. b., provides additional information sufficient to distinguish the trust from other trusts having one or more of the same settlors or the same testator and indicates that the collateral is held in a trust, unless the additional information so indicates;

409.503(1)(dm) (dm) Subject to sub. (7), if the debtor is an individual to whom this state has issued an operator’s license under ch. 343 or identification card under s. 343.50 that has not expired, only if the financing statement provides the name of the individual which is indicated on the operator’s license or identification card;

409.503(1)(e) (e) If the debtor is an individual to whom par. (dm) does not apply, only if the financing statement provides the individual name of the debtor or the surname and first personal name of the debtor; and

409.503(1)(f) (f) In other cases:

409.503(1)(f)1. 1. If the debtor has a name, only if the financing statement provides the organizational name of the debtor; and

409.503(1)(f)2. 2. If the debtor does not have a name, only if the financing statement provides the names of the partners, members, associates, or other persons comprising the debtor, in a manner that each name provided would be sufficient if the person named were the debtor.

409.503(2) (2) Additional debtor-related information. A financing statement that provides the name of the debtor in accordance with sub. (1) is not rendered ineffective by the absence of:

409.503(2)(a) (a) A trade name or other name of the debtor; or

409.503(2)(b) (b) Unless required under sub. (1) (f) 2., names of partners, members, associates, or other persons comprising the debtor.

409.503(3) (3) Debtor’s trade name insufficient. A financing statement that provides only the debtor’s trade name does not sufficiently provide the name of the debtor.

409.503(4) (4) Representative capacity. Failure to indicate the representative capacity of a secured party or representative of a secured party does not affect the sufficiency of a financing statement.

409.503(5) (5) Multiple debtors and secured parties. A financing statement may provide the name of more than one debtor and the name of more than one secured party.

409.503(6) (6) Name of decedent. The name of the decedent indicated on the order appointing the personal representative of the decedent issued by the court having jurisdiction over the collateral is sufficient as the “name of the decedent” under sub. (1) (b).

409.503(7) (7) Multiple licenses or identification cards. If this state has issued to an individual more than one operator’s license under ch. 343 or identification card under s. 343.50 of a kind described in sub. (1) (dm), the one that was issued most recently is the one to which sub. (1) (dm) refers.

409.503(8) (8) Definition. In this section, the “name of the settlor or testator” means:

409.503(8)(a) (a) If the settlor is a registered organization, the name that is stated to be the settlor’s name on the public organic record most recently filed with or issued or enacted by the settlor’s jurisdiction of organization which purports to state, amend, or restate the settlor’s name;

409.503(8)(b) (b) In other cases, the name of the settlor or testator indicated in the trust’s organic record.

409.503 History History: 2001 a. 10; 2011 a. 206.

409.503 Annotation A creditor’s financing statement became “seriously misleading” after the debtors’ name change and so was insufficient to perfect a security interest in property acquired more than 4 months after the name change. First Agri Services, Inc. v. Kahl, 129 Wis. 2d 464, 385 N.W.2d 191 (Ct. App. 1986).

409.503 Note NOTE: The above annotated materials cite to the pre-2001 Wis. Act 10 version of ch. 409.

409.504 409.504 Indication of collateral. A financing statement sufficiently indicates the collateral that it covers if the financing statement provides:

409.504(1) (1) A description of the collateral pursuant to s. 409.108; or

409.504(2) (2) An indication that the financing statement covers all assets or all personal property.

409.504 History History: 2001 a. 10.

409.505 409.505 Filing and compliance with other statutes and treaties for consignments, leases, other bailments, and other transactions.

409.505(1) (1) Use of terms other than debtor and secured party. A consignor, lessor, or other bailor of goods, a licensor, or a buyer of a payment intangible or promissory note may file a financing statement, or may comply with a statute or treaty described in s. 409.311 (1), using the terms “consignor”, “consignee”, “lessor”, “lessee”, “bailor”, “bailee”, “licensor”, “licensee”, “owner”, “registered owner”, “buyer”, “seller”, or words of similar import, instead of the terms “secured party” and “debtor”.

409.505(2) (2) Effect of financing statement under sub. (1). This subchapter applies to the filing of a financing statement under sub. (1) and, as appropriate, to compliance that is equivalent to filing a financing statement under s. 409.311 (2), but the filing or compliance is not of itself a factor in determining whether the collateral secures an obligation. If it is determined for another reason that the collateral secures an obligation, a security interest held by the consignor, lessor, bailor, licensor, owner, or buyer which attaches to the collateral is perfected by the filing or compliance

409.505 History History: 2001 a. 10.

409.506 409.506 Effect of errors or omissions.

409.506(1) (1) Minor errors and omissions. A financing statement substantially satisfying the requirements of this subchapter is effective, even if it has minor errors or omissions, unless the errors or omissions make the financing statement seriously misleading.

409.506(2) (2) Financing statement seriously misleading. Except as otherwise provided in sub. (3), a financing statement that fails sufficiently to provide the name of the debtor in accordance with s. 409.503 (1) is seriously misleading.

409.506(3) (3) Financing statement not seriously misleading. If a search of the records of the filing office under the debtor’s correct name, using the filing office’s standard search logic, if any, would disclose a financing statement that fails sufficiently to provide the name of the debtor in accordance with s. 409.503 (1), the name provided does not make the financing statement seriously misleading.

409.506(4) (4) Debtor’s correct name. For purposes of s. 409.508 (2), the “debtor’s correct name” in sub. (3) means the correct name of the new debtor.

409.506 History History: 2001 a. 10.

409.506 Annotation A creditor’s financing statement became “seriously misleading” after the debtors’ name change and so was insufficient to perfect a security interest in property acquired more than 4 months after the name change. First Agri Services, Inc. v. Kahl, 129 Wis. 2d 464, 385 N.W.2d 191 (Ct. App. 1986).

409.506 Annotation A wrong statement of section, township, range, and county where crops were grown was not minor, and, without directing further inquiry, was insufficient. Whether a party is misled by the description is not part of the inquiry under s. 409.110 or 409.402. Smith & Spindahl Enterprises, Inc. v. Lee, 206 Wis. 2d 663, 557 N.W.2d 865 (Ct. App. 1996), 96-0882.

409.506 Note NOTE: The above annotated materials cite to the pre-2001 Wis. Act 10 version of ch. 409.

409.507 409.507 Effect of certain events on effectiveness of financing statement.

409.507(1) (1) Disposition. A filed financing statement remains effective with respect to collateral that is sold, exchanged, leased, licensed, or otherwise disposed of and in which a security interest or agricultural lien continues, even if the secured party knows of or consents to the disposition.

409.507(2) (2) Information becoming seriously misleading. Except as otherwise provided in sub. (3) and s. 409.508, a financing statement is not rendered ineffective if, after the financing statement is filed, the information provided in the financing statement becomes seriously misleading under s. 409.506.