Disposition of Collateral. With a loan of $1.4$ million euros from Barclays Bank, PLC, Thomas Poynter bought a yacht. The loan agreement gave Barclays multiple stand-alone options on default. One option required the lender to give ten days' advance notice of a sale. A different option permitted the lender to avoid this requirement. When Poynter did not repay the loan, Barclays repossessed the yacht and notified Poynter that it would be sold-but did not specify a date, time, or place. Two months later, the yacht was sold. The sale price was less than Poynter owed, and Barclays filed a suit in a federal district court for the deficiency. Is Barclays entitled to collect even though it did not give Poynter ten days' advance notice of the sale? Explain.

Paul Barton owned a small property-management company, doing business as Brighton Homes. In October, Barton went on a spending spree. First, he bought a Bose surround-sound system for his home from KDM Electronics. The next day, he purchased a Wilderness Systems kayak and roof rack from Outdoor Outfitters, and the day after that he bought a new Toyota 4-Runner financed through Bridgeport Auto. Two weeks later, Barton purchased six new iMac computers for his office, also from KDM Electronics. Barton bought each of these items under an installment sales contract. Six months later, Barton's property-management business was failing. He could not make the payments due on any of these purchases and defaulted on the loans. Using the information presented in the chapter, answer the following questions.

Suppose that after KDM Electronics repossesses the surround-sound system, it decides to keep the system rather than sell it. Can KDM do this under Article $9$? Why or why not?

Paul Barton owned a small property-management company, doing business as Brighton Homes. In October, Barton went on a spending spree. First, he bought a Bose surround-sound system for his home from KDM Electronics. The next day, he purchased a Wilderness Systems kayak and roof rack from Outdoor Outfitters, and the day after that he bought a new Toyota 4-Runner financed through Bridgeport Auto. Two weeks later, Barton purchased six new iMac computers for his office, also from KDM Electronics. Barton bought each of these items under an installment sales contract. Six months later, Barton's property-management business was failing. He could not make the payments due on any of these purchases and defaulted on the loans. Using the information presented in the chapter, answer the following questions.

Which of these purchases would qualify as a PMSI in consumer goods?

The Scope of a Security Interest. Edward owned a retail sporting goods shop. A new ski resort was being constructed in his area, and to take advantage of the potential business, Edward decided to expand his operations. He borrowed a large sum from his bank, which took a security interest in his present inventory and any after-acquired inventory as collateral for the loan. The bank properly perfected the security interest by filing a financing statement. Edward's business was profitable, so he doubled his inventory. A year later, just a few months after the ski resort had opened, an avalanche destroyed the ski slope and lodge. Edward's business consequently took a turn for the worse, and he defaulted on his debt to the bank. The bank then sought possession of his entire inventory, even though the inventory was now twice as large as it had been when the loan was made. Edward claimed that the bank had rights to only half of his inventory. Was Edward correct? Explain.

Paul Barton owned a small property-management company, doing business as Brighton Homes. In October, Barton went on a spending spree. First, he bought a Bose surround-sound system for his home from KDM Electronics. The next day, he purchased a Wilderness Systems kayak and roof rack from Outdoor Outfitters, and the day after that he bought a new Toyota 4-Runner financed through Bridgeport Auto. Two weeks later, Barton purchased six new iMac computers for his office, also from KDM Electronics. Barton bought each of these items under an installment sales contract. Six months later, Barton's property-management business was failing. He could not make the payments due on any of these purchases and defaulted on the loans. Using the information presented in the chapter, answer the following questions.

Suppose that Barton's contract for the office computers mentioned only the name Brighton Homes. What would be the consequences if KDM Electronics filed a financing statement that listed only Brighton Homes as the debtor's name?

New England Precision Grinding, Inc. (NEPG), sells precision medical parts in Massachusetts. NEPG agreed to supply Kyphon, Inc., with stylets and nozzles. NEPG contracted with Simply Surgical, LLC, to obtain the parts from Iscon Surgicals, Ltd. e contract did not mention Kyphon or require Kyphon’s acceptance of the parts. Before shipping, Iscon would certify that the parts conformed to NEPG’s specications. On receiving the parts, NEPG would certify that they conformed to Kyphon’s specications. On delivery, Kyphon would also inspect the parts. After about half a dozen transactions, NEPG’s payments to Simply Surgical lagged, and the seller refused to make further deliveries. NEPG led a suit in a Massachusetts state court against Simply Surgical, alleging breach of contract. NEPG claimed that Kyphon had rejected some of the parts, which gave NEPG the right not to pay for them. Do the UCC’s rules with respect to acceptance support or undercut the parties’ actions? Discuss. [New England Precision Grinding, Inc. v. Simply Surgical, LLC, 89 Mass.App.Ct.176, 46 N.E.3d 590 (2016)]

A car dealer buys a used car for $3200. The dealer sells the car at a 24% profit. For how much does the car dealer sell the car? F.$668 G. $3968 H.$66,800 J. $70,000

On September 1, Jennings, a used-car dealer, wrote a letter to Wheeler, stating, "I have a $1955$ Thunderbird convertible in mint condition that I will sell you for $13,500$ dollars at any time before October $9$. [signed] Peter Jennings." By September $15$, having heard nothing from Wheeler, Jennings sold the Thunderbird to another party. On September $29$, Wheeler accepted Jennings's offer and tendered the $13,500$ dollars. When Jennings told Wheeler he had sold the car to another party, Wheeler claimed Jennings had breached their contract. Is Jennings in breach? Explain.

In April 2013, the total sales from General Motors, Ford, or Chrysler was 606,334 cars or light trucks. The probability that the vehicle sold was made by General Motors was .392, by Ford $.350$, and by Chrysler.258. Additionally, the probability that a General Motors vehicle sold was a car was .395, a Ford vehicle sold was a car was .370, and a Chrysler vehicle sold was a car was .332.

Given the vehicle sold was a car, find the probability it was made by General Motors.

Perfection of a Security Interest. Marsh has a prize horse named Arabian Knight. Marsh is in need of working capital. She borrows $\$ 50,000$ from Mendez, who takes possession of Arabian Knight as security for the loan. No written agreement is signed. Discuss whether, in the absence of a written agreement, Mendez has a security interest in Arabian Knight. If Mendez does have a security interest, is it a perfected security interest? Explain. (See Perfection of a Security Interest.)

Security Interests. Nick Sabol, doing business in the recording industry as Sound Farm Productions, applied to Morton Community Bank for a $\$ 58,000$ loan to expand his business. Besides the loan application, Sabol signed a promissory note that referred to the bank's rights in "any collateral." Sabol also signed a letter authorizing Morton Community Bank to execute, file, and record all financing statements, amendments, and other documents required by Article $9$ to establish a security interest. Sabol did not sign any other documents, including the financing statement, which contained a description of the collateral. Two years later, without having repaid the loan, Sabol filed for bankruptcy. The bank claimed a security interest in Sabol's sound equipment. (See Creation of a Security Interest.)

(a) The first group will list all the requirements of an enforceable security interest and explain why each of these elements is necessary.

(b) The second group will determine if Morton Community Bank had a valid security interest.

(c) The third group will discuss whether a bank should be able to execute financing statements on a debtor's behalf without the debtor being present or signing them. Are there are any drawbacks to this practice? Explain.

Paul Barton owned a small property-management company, doing business as Brighton Homes. In October, Barton went on a spending spree. First, he bought a Bose surround-sound system for his home from KDM Electronics. The next day, he purchased a Wilderness Systems kayak and roof rack from Outdoor Outfitters, and the day after that he bought a new Toyota 4-Runner financed through Bridgeport Auto. Two weeks later, Barton purchased six new iMac computers for his office, also from KDM Electronics. Barton bought each of these items under an installment sales contract. Six months later, Barton's property-management business was failing. He could not make the payments due on any of these purchases and defaulted on the loans. Using the information presented in the chapter, answer the following questions.

For which of Barton's purchases (the surround-sound system, the kayak, the $4$-Runner, and the iMacs) would the creditor need to file a financing statement to perfect its security interest?

Priorities. Redford is a seller of electric generators. He purchases a large quantity of generators from a manufacturer, Mallon Corp., by making a down payment and signing an agreement to make the balance of payments over a period of time. The agreement gives Mallon Corp. a security interest in the generators and the proceeds. Mallon Corp. properly files a financing statement on its security interest. Redford receives the generators and immediately sells one of them to Garfield on an installment contract, with payment to be made in twelve equal installments. At the time of the sale, Garfield knows of Mallon's security interest. Two months later, Redford goes into default on his payments to Mallon. Discuss Mallon's rights against Garfield in this situation. (See Priorities.)

Suppose that the California legislature passes a law that severely restricts carbon dioxide emissions from automobiles in that state. A group of automobile manufacturers files suit against the state of California to prevent the enforcement of the law. The automakers claim that a federal law already sets fuel economy standards nationwide and that fuel economy standards are essentially the same as carbon dioxide emission standards. According to the automobile manufacturers, it is unfair to allow California to impose more stringent regulations than those set by the federal law. Using the information presented in the chapter, answer the following questions.

Where would you look to find the relevant California and federal laws?