UCC News

Vermont-UCC Fees Increase effective March 1, 2004

UCC Filing: $20.00 if the record is communicated in writing and consists of one or two pages

UCC Filing of more than one name: $2.00 per name over two

UCC Certified Search Request: $20.50 per copy


Performing Due Diligence on UCC Searches

Consider name variation searches to discover hidden UCC liens that may not be revealed on Revised Article 9 (RA9) searches done directly with the jurisdiction. You can verify the perfection of filings recorded since July 1, 2001 on both pre-filing discovery and post-filing verification when you order your RA9 searches. Contact your CSC^SM Customer Service Representative for more information about name variation searches. (* See article below.)

Including Terminated Statements on UCC searches

Revised Article 9 has eliminated the signature requirement on UCC filings including amendments (terminations) and many jurisdictions do not require debtor names on terminations. CSC reminds customers to always request that terminations are included on the reports to ensure:

• that a debtor has not terminated an original on himself or his business
• that jurisdictions and correspondents don't fail to include a "partial termination" (in the case of a UCC with multiple secured parties where one of these parties terminates only their security interest)
• that the correct original has indeed been terminated (it is easy to type an incorrect original number on the amendment and mistakenly terminate an original that does not coincide with the debtor name you are really trying to terminate)

Recordation and Retrieval of Real Estate Documents:

Remember that CSC can assist you in the filing and retrieving of mortgages, deeds, assignments, releases and other real estate documents. Likewise, we can provide ownership and encumbrance reports, copies of real estate documents, and property and tax reports as needed.

* Case Law Shows Importance of Identifying the Correct Debtor Name
In Re: Receivables Purchasing Company, Inc. v. R & R Directional Drilling, LLC. in the Georgia Court of Appeals, the court upheld the trial court decision that a financing statement filed 4/2/01 (prior to RA9 implementation) under a variation of the debtor name, that was not found when on a search of the Georgia Clerks Cooperative Authority database on the "correct debtor name" as found on the Articles of Incorporation, was seriously misleading under RA9 -506(b) and therefore ineffective.

The debtor name on the financing statement was "The Net work Solutions, Inc." versus the name on the Articles, which was "The Network Solutions, Inc." In Georgia, the search logic does not follow the suggested RA9 standard search logic, and as a result spaces are not ignored and the financing statement was not found. This further reinforces the importance of following best practices that CSC has asked customers to consider when filing and searching UCCs. In this case, not only was a very slight variation costly, but one that was made on a pre-effective financing statement.

Suggested Best Practices:

• Order a Preliminary Name Variation Search Listing to determine name variations under which UCCs have been filed on the debtor and make a business decision which of these to search as part of your due diligence.
• Order copies of the Articles of Incorporation and all Amendments for registered entities to determine the correct debtor name. (for non-registered entities you will need formation documents and for individuals you will need a driver’s license, social security card, passport, birth certificate and/or marriage license)
• File on the correct debtor name
• Order a search to reflect your filing, using the standard search logic of the filing office and not from a private database, on the correct debtor name to ensure no typographical errors were made and the filing office has indexed it properly
• Keep copies of all verification documentation in your loan portfolio