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Unformatted text preview: I. Part I: Overview A. Class 1: Overview 1. Mr. Broke pledges the diamond ring. A slide show B. Class 2: Overview 1. Don Fraser and Lu Durhan were tree loggers in Washington State. On secured credit of $222,173, their company Diamond Timber, Inc. leased a log loader machine from Cascade Loggers Supply, Inc. in June of 1979, which then assigned the contract to Leasing Service Corp. When fifteen months later Don and Lu refused to continue payments because the machine did not work, Leasing Service Corp. repossessed the logger and conducted a public foreclosure sale under the former Article 9 of the Uniform Commercial Code. At the public sale, Leasing Service Corp. bought the equipment for $62,700. It then sued Diamond Timber, and Don and Lu as guarantors of their company's lease, for a $248,518 deficiency. This amount represented the unpaid lease and expenses consisting of late payment charges, attorney's fees and taxes minus the $62,700 sale price. Leasing Service Corp. won the lawsuit. Everything in the above hypothetical is done according to the rules (9-609) (9-610) and (9-615) 2. Browse Sections: 9-609; 9-610. II. Part II: Attachment A. Class 3: Introduction 1. What is a secured transaction? a. Section 1-201 (37) (first sentence): Security interest includes the interest of a consignor and the interest of a buyer of accounts, chattel paper, payment intangibles, or promissory notes. Security interest is a property interest that the borrower gives in return for a loan. It is a property right and this right becomes a piece of property. So secured transaction creates a property right in favor of the lender by the means of contract. b. Section 9-102 (12, 28, 72 & 73): i. (12) Collateral: means the property subject to a security interest or agricultural lien. Collateral includes (A) proceeds to which a security interest attaches; (B) accounts, chattel paper, payment intangibles, and promissory notes that have been sold; and (C) goods that are the subject of a consignment. ii. (28) Debtor means: (A) a person having an interest, other than a security interest or other lien, in the collateral, whether or not the person is an obligor; (B) a seller of accounts, chattel paper, payment intangibles, or promissory notes; or (C) a consignee. iii. (72) Secured party means: (A) a person in whose favor a security interest is created or provided for under a security agreement, whether or not any obligation to be secured is outstanding; (B) a person that holds an agricultural lien; (C) a consignor; (D) a person to which accounts, chattel paper, payment intangibles, or promissory notes have been sold. iv. (73) Security agreement: means an agreement that creates or provides for a security interest....
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This note was uploaded on 04/17/2008 for the course LAW ? taught by Professor Harmon during the Spring '08 term at Touro NY.
- Spring '08