Secured Transactions

2.0 credits · LA

A study of Article 9 of the Uniform Commercial Code, the law regarding security interests in personal property. In a secured transaction, a creditor may resort directly to particular assets of the debtor if an obligation is not met. The assets may be virtually any property, whether tangible (e.g., inventory and equipment) or intangible (e.g., shares of stock, accounts, intellectual property). Secured transactions are an integral part of the complex world of commercial finance. They help fuel the economy by enabling debtors to borrow more freely and lenders to better manage risk. On the other hand, if a debtor becomes insolvent, there might be nothing left for other creditors or tort victims because Article 9 enables lenders who take security to claim virtually all the debtor’s assets. The first goal of the course is for students to become familiar with the substantive law, and particularly to learn to recognize when Article 9 applies to a transaction, which may not be immediately apparent. Second, working through the intricacies of Article 9 will help students sharpen their skills in statutory interpretation. Finally, we will address some of the theoretical issues involved in security and debt. There is no prerequisite for this course. (Students with a particular interest in commercial law may wish to study bankruptcy as well as secured transactions, but this can be done in either order.)