Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

In the Problem below, there is what Comment 4 to 9-507 refers to as a case in which a filed financing statement provides a name

In the Problem below, there is what Comment 4 to 9-507 refers to as a case in which a filed financing statement provides a name that, at the time of filing, satisfies the requirements of Section 9-503(a) with respect to the named debtor but, at later time, no longer does so. The business entity has not changed, only its name has. PROBLEM Shannon and Patricia Scott own all of the stock of K.C. of Camden, Inc., which entered into a security agreement granting a security interest in all inventory, accounts, machinery, equipment, furniture, and fixtures, now owned or thereafter acquired, to Bank as security for a loan. Bank promptly filed a financing statement naming K.C. of Camden, Inc. as the debtor. A year later the Scotts decided to change the name of their company to "Camden Audio and Video, Inc." They did not inform Bank of the change. The newly renamed company applied for a loan from Lender, which advanced the funds after finding no financing statement on record in the name of Camden Audio and Video, Inc. Lender took a security interest in the same assets covered by Bank's security interest and filed a financing statement naming Camden Audio and Video, Inc. as the debtor. Which secured party is prior as to the described collateral acquired by the debtor before and after the name change? Would you get the same result if the new name were "K.C. of Camden Audio and Video, Inc."? See 9- 507(b)-(c) and Comment 4 to 9-507

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction to Law and the Legal System

Authors: Frank August Schubert

10th Edition

049589933X, 978-0495899334

More Books

Students also viewed these Law questions