Secured Transactions- Attachment

STUDY
PLAY
Attachment Elements
1. Written Security Agreement or Creditor must have taken possession of collateral
2. Creditor Must Have Given Value
3. Debtor Must Have Rights in the Collateral
Form of Security Agreement
1. Intent
2. Authentication
3. Description that reasonably id's
Scope of Security Interest (4)
1. Future Advance
2. After Acquired Property
3. Generally INcludes Proceeds
4. Automatically attaches to supporting obgliation (like a sureity)
General Rules for After Acquired Property
without After Acquired Property Clause, security interest only attaches to collateral in debtors possession
Exceptions to Limits on AQP
1. Court will imply if collateral is type that rapidly depletes and replinishes
2. Generally doesn't work for consumer goods acquired 10 days out
3. Ineffective as to comercial tort claims
Proceeds
Security Agreement generally gives rise to rights in proceeds from sale of collateral
What to Do you Thomas if Cash Proceeds a Co-Mingled with Non Cash Proceeds
use lowest intermediate balance test
look at the balance from the time the secured interest is deposited and the lowest balance is the identifiable proceeds