Business Law II

Please answer question 5

Paula, an accountant, lent money to a company that was already indebted to her for services rendered. As security for the loan and to secure payment for the services, the company assigned to Paula a portion of fits expected recovery of a pending lawsuit. Paula did not file a financing statement with regard to the assignment. Subsequently, Debra was awarded a judgment against the company in another lawsuit. Debra, without knowledge of the assignment to Paula, had the sheriff levy against the company's property. At eh sheriff's execution sale all of the company's rights in the pending lawsuit were sold to debar. When the lawsuit was settled, Paula claimed rights to the processed. Is Paula entitled to the proceeds of the lawsuit pursuant to her security interest? Explain. By answering the following, check your knowledge of the business decisions involved in secured transactions: a. Assume that you are a retailer with a large amount of outstanding accounts receivable and you are in need of cash to pay expenses. How might you raise the necessary cash? b. Assume that you are considering lending to Fred Tauber of Tauber & Sons and taking a security interest in certain property of Tauber & Sons. What should you do prior to lending the money? Explain. Assume that you are arranging to finance another's business. It will be a secured financing plane that works on a continuing basis. What provisions should you required for inclusion in the security agreement and in the financing statement? Explain. Assume that you are a secured party and are in doubt about whether you have to fill and, if so, where to file. What do you do? Explain