With the July 1, 2013 effective date of the 2010 Amendments to Article 9 of the UCC right around the corner, we want to highlight the differences between the old forms and the new forms, and share some tips about using the forms designed to go along with the Amendments. (Follow this link to take a look at the new forms.)
New is a relative term
The “new” UCC forms bear a revision date of 04/20/11, so they are not exactly new. The forms were drafted to complement the 2010 Amendments after the Amendments were approved by the committee.
Don’t use the new forms until it’s time
Even if a jurisdiction has already enacted the Amendments, as most have done, you cannot use the new forms until the effective date. In most states, the effective date is July 1, 2013, but a few jurisdictions are considering legislation to delay the effective date, while some have not even introduced the Amendments to the state legislatures yet. Be sure to find out whether the Amendments are in effect in a jurisdiction before filing new forms, because the new forms do not contain fields for all of the information required under current law.
Be aware of missing or moved fields
Some of the required information fields are in a different place on the new forms. For example, the check box used to indicate that a financing statement should be filed in the real estate records has been removed from the UCC-1 Financing Statement and moved to the UCC-1 AD Addendum form. Any UCC-1 related to a fixture must be filed in the real estate records as part of perfecting a lender’s security interest. Failing to check the appropriate box on the UCC-1 AD Addendum form could cause expensive problems down the road.
Some states will be gracious
Many filing offices are expected to allow a 30-day grace period for the changeover and accept UCC-1 Financing Statements on the old forms. Absent legislation stating otherwise, each jurisdiction has discretion as to whether to implement a grace period and how long to continue accepting the old forms. The best practice is to convert to the new forms as quickly as possible as of the effective date. If you must use an old form, contact the filing office in the relevant jurisdiction to be sure they will accept the old form before you file it.
If you are a lender or other secured party with other questions about implementing the changes required by the 2010 Amendments, seek the advice of experienced legal counsel. The attorneys at Glass & Goldberg are committed to helping you minimize risk and manage uncertainty, and can help structure your policies and procedures to meet your goals.
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