I know that based on the type of UCC form you are filling you may need to file it with either the state or the local county. Does this mean that when trying to retrieve UCC documents pertaining to a certain company I would need to put in an order request with both the local county and state? Or would the local county pass those docs up to the state level also. (I'm assuming the answer here will probably be "well it depends on what state and county...")
Thank You!
The Uniform Commercial Code is a law governing personal property security interests (i.e. mortgages in personal property). In other words, it governs using personal property as collateral for loans.
Under the UCC, there are two important steps: attachment and perfection. A security interest is effective against the party granting it when it "attaches" usually immediately upon the signing of the security agreement. But, a security interest is not effective in bankruptcy or against third parties until it is "perfected".
How is a security interest perfected?
You have to look at Sections 301-324 of Article 9 of the current version of the Uniform Commercial Code, or, in states that haven't adopted the most recent version of the Uniform Commercial Code, Sections 301 et seq. of Article 9 of the Uniform Commercial Code.
The way a security interest is perfected varies by the type of property involved.
Security interests in some property can only be perfected by possession (i.e. a pawn transaction) or control.
Perfection of some kinds of property (e.g. automobiles, airplanes, copyrights) are governed by specific laws outside the UCC: security interests in automobiles must be shown on the certificate of title, security interests in airplanes and copyrights are perfected in special national registries.
When there is no special rule that applies, security interests are perfected by filing with a state level official, usually the state government's Secretary of State for the state where the debtor resides or is organized if the debtor is an entity.
Historically, under the 1998 version of the UCC adopted in all U.S. states, in addition to the state filing, it was also necessary to make a filing in the real estate records of the county where the property was located for certain kinds of personal property with a connection to real estate, the most common of which were "fixtures" which are items of tangible personal property that are attached to real estate, and for security interests in growing crops which are by their very nature attached to the land upon which they grow. Counties have never shared their filings with the state, so a state level search is not sufficient to determine if fixtures or agricultural property are lien free in states where there a valid filings made under the 1998 version of the law that are still in force.
The requirements to perfect an agricultural lien or a lien in fixtures in the modern version of Article 9 of the UCC (finalized for adoption by states in 2010) are found at Section 310 of Article 9 of the Uniform Commercial Code, which dispenses with the county level filing requirement of the 1998 Act.
The 2010 version of Article 9 has currently been adopted by every U.S. state. There was a strong push for all states to adopt the 2010 amendments with a uniform effective date of July 1, 2013, so as to allow states to adopt the amendments uniformly and have them become operative simultaneously (thereby avoiding unnecessary conflicts and confusion with respect to interstate transactions). Mostly this was successful, but there may have been isolated exceptions.
For the most part, the grandfathered filings have now expired. But there may be some states, particularly those which were late adopters, where grandfathered filings are still effective.
