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90_HB3472eng
810 ILCS 5/9-105 from Ch. 26, par. 9-105
810 ILCS 5/9-106 from Ch. 26, par. 9-106
810 ILCS 5/9-302 from Ch. 26, par. 9-302
Amends the Secured Transactions Article of the Uniform
Commercial Code. Provides that "deposit account" includes
certain accounts maintained with a bank as bank is defined in
the Article on bank deposits and collections. Defines
"non-negotiable certificate of deposit" and "non-transferable
certificate of deposit" and includes them in the definition
of "instrument". Defines "uncertificated certificate of
deposit" as an obligation of a bank to repay a sum of money
represented only by a writing in the books of the bank or
documentation given to a customer, and provides that a filing
is not required to perfect a security interest in an
uncertificated certificate of deposit, but such interest is
perfected when the security agreement is signed, or when the
issuer acknowledges and consents to notice of perfection by
the secured party. Effective immediately.
LRB9009411SMdv
HB3472 Engrossed LRB9009411SMdv
1 AN ACT to amend the Uniform Commercial Code by changing
2 Sections 9-105, 9-106, and 9-302.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Uniform Commercial Code is amended by
6 changing Sections 9-105, 9-106, and 9-302 as follows:
7 (810 ILCS 5/9-105) (from Ch. 26, par. 9-105)
8 Sec. 9-105. Definitions and index of definitions.
9 (1) In this Article unless the context otherwise
10 requires:
11 (a) "Account debtor" means the person who is
12 obligated on an account, chattel paper or general
13 intangible;
14 (b) "Chattel paper" means a writing or writings
15 which evidence both a monetary obligation and a security
16 interest in or a lease of specific goods, but a charter
17 or other contract involving the use or hire of a vessel
18 is not chattel paper. When a transaction is evidenced
19 both by such a security agreement or a lease and by an
20 instrument or a series of instruments, the group of
21 writings taken together constitutes chattel paper;
22 (c) "Collateral" means the property subject to a
23 security interest, and includes accounts and chattel
24 paper which have been sold;
25 (d) "Debtor" means the person who owes payment or
26 other performance of the obligation secured, whether or
27 not he owns or has rights in the collateral, and includes
28 the seller of accounts or chattel paper. Where the debtor
29 and the owner of the collateral are not the same person,
30 the term "debtor" means the owner of the collateral in
31 any provision of the Article dealing with the collateral,
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1 the obligor in any provision dealing with the obligation,
2 and may include both where the context so requires;
3 (e) "Deposit account" means a demand, time,
4 savings, passbook or like account maintained with a bank,
5 as defined in subsection (1) of Section 4-105 savings and
6 loan association, credit union or like organization,
7 other than an account evidenced by a certificate of
8 deposit;
9 (f) "Document" means document of title as defined
10 in the general definitions of Article 1 (Section 1-201),
11 and a receipt of the kind described in subsection (2) of
12 Section 7-201;
13 (g) "Encumbrance" includes real estate mortgages
14 and other liens on real estate and all other rights in
15 real estate that are not ownership interests;
16 (h) "Goods" includes all things which are movable
17 at the time the security interest attaches or which are
18 fixtures (Section 9-313), but does not include money,
19 documents, instruments, investment property, commodity
20 contracts, accounts, chattel paper, general intangibles,
21 or minerals or the like (including oil and gas) before
22 extraction. "Goods" also includes standing timber which
23 is to be cut and removed under a conveyance or contract
24 for sale, the unborn young of animals, and growing crops;
25 (i) "Instrument" means a negotiable instrument
26 (defined in Section 3-104), a non-transferable
27 certificate of deposit, a non-negotiable certificate of
28 deposit, or any other writing which evidences a right to
29 the payment of money and is not itself a security
30 agreement or lease and is of a type which is in ordinary
31 course of business transferred by delivery with any
32 necessary indorsement or assignment. The term does not
33 include investment property;
34 (j) "Mortgage" means a consensual interest created
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1 by a real estate mortgage, a trust deed on real estate,
2 or the like;
3 (j-5) "Non-negotiable certificate of deposit" means
4 a written document issued by a bank, as defined in
5 subsection (1) of Section 4-105, that contains an
6 acknowledgement that a sum of money has been received by
7 the issuer and a promise by the issuer to repay the sum
8 of money, and is not a negotiable instrument as defined
9 in Section 3-104;
10 (j-7) "Non-transferable certificate of deposit"
11 means a non-negotiable certificate of deposit which may
12 not be transferred except on the books of the issuer,
13 with the consent of the issuer, or is subject to other
14 restrictions or conditions of the issuer on transfer;
15 (k) An advance is made "pursuant to commitment" if
16 the secured party has bound himself to make it, whether
17 or not a subsequent event of default or other event not
18 within his control has relieved or may relieve him from
19 his obligation;
20 (l) "Security agreement" means an agreement which
21 creates or provides for a security interest;
22 (m) "Secured party" means a lender, seller or other
23 person in whose favor there is a security interest,
24 including a person to whom accounts or chattel paper have
25 been sold. When the holders of obligations issued under
26 an indenture of trust, equipment trust agreement or the
27 like are represented by a trustee or other person, the
28 representative is the secured party;
29 (n) "Transmitting utility" means any person
30 primarily engaged in the railroad, street railway or
31 trolley bus business, the electric or electronics
32 communications transmission business, the transmission of
33 goods by pipeline, or the distribution, transmission, or
34 the production and transmission of electricity, steam,
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1 gas or water, or the provision of sewer service.
2 (o) "Uncertificated certificate of deposit" means an
3 obligation of a bank, as defined in subsection (1) of Section
4 4-105, to repay a sum of money it has received, that is not a
5 deposit account and is not represented by a writing, but only
6 by an entry on the books of the bank and any documentation
7 given to the customer by the bank.
8 (2) Other definitions applying to this Article and the
9 Sections in which they appear are:
10 "Account". Section 9-106.
11 "Attach". Section 9-203.
12 "Commodity contract". Section 9-115.
13 "Commodity customer". Section 9-115.
14 "Commodity intermediary". Section 9-115.
15 "Construction mortgage". Section 9-313 (1).
16 "Consumer goods". Section 9-109 (1).
17 "Control". Section 9-115.
18 "Equipment". Section 9-109 (2).
19 "Farm products". Section 9-109 (3).
20 "Fixture". Section 9-313 (1).
21 "Fixture filing". Section 9-313 (1).
22 "General intangibles". Section 9-106.
23 "Inventory". Section 9-109 (4).
24 "Investment property". Section 9-115.
25 "Lien creditor". Section 9-301 (3).
26 "Proceeds". Section 9-306 (1).
27 "Purchase money security interest". Section 9-107.
28 "United States". Section 9-103.
29 (3) The following definitions in other Articles apply to
30 this Article:
31 "Bank". Section 4-105.
32 "Broker". Section 8-102.
33 "Certificated security". Section 8-102.
34 "Check". Section 3-104.
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1 "Clearing corporation". Section 8-102.
2 "Contract for sale". Section 2-106.
3 "Control". Section 8-106.
4 "Delivery". Section 8-301.
5 "Entitlement holder". Section 8-102.
6 "Financial asset". Section 8-102.
7 "Holder in due course". Section 3-302.
8 "Letter of credit". Section 5-102.
9 "Note". Section 3-104.
10 "Proceeds of a letter of credit". Section 5-114(a).
11 "Sale". Section 2-106.
12 "Securities intermediary". Section 8-102.
13 "Security". Section 8-102.
14 "Security certificate". Section 8-102.
15 "Security entitlement". Section 8-102.
16 "Uncertificated security". Section 8-102.
17 (4) In addition Article 1 contains general definitions
18 and principles of construction and interpretation applicable
19 throughout this Article.
20 (Source: P.A. 89-364, eff. 1-1-96; 89-534, eff. 1-1-97.)
21 (810 ILCS 5/9-106) (from Ch. 26, par. 9-106)
22 Sec. 9-106. Definitions: "account"; "general
23 intangibles". "Account" means any right to payment for goods
24 sold or leased or for services rendered which is not
25 evidenced by an instrument or chattel paper, whether or not
26 it has been earned by performance. "General intangibles"
27 means any personal property (including things in action)
28 other than goods, accounts, chattel paper, documents,
29 instruments, investment property, rights to proceeds of
30 written letters of credit, deposit accounts, uncertificated
31 certificates of deposit, and money. All rights to payment
32 earned or unearned under a charter or other contract
33 involving the use or hire of a vessel and all rights incident
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1 to the charter or contract are accounts.
2 (Source: P.A. 89-364, eff. 1-1-96; 89-534, eff. 1-1-97.)
3 (810 ILCS 5/9-302) (from Ch. 26, par. 9-302)
4 Sec. 9-302. When filing is required to perfect security
5 interest; security interests to which filing provisions of
6 this Article do not apply.
7 (1) A financing statement must be filed to perfect all
8 security interests except the following:
9 (a) a security interest in collateral in possession
10 of the secured party under Section 9-305;
11 (b) a security interest temporarily perfected in
12 instruments, certificated securities, or documents
13 without delivery under Section 9-304 or in proceeds for a
14 20 day period under Section 9-306;
15 (c) a security interest created by an assignment of
16 a beneficial interest in a trust or a decedent's estate;
17 (d) a purchase money security interest in consumer
18 goods; but filing is required for a motor vehicle
19 required to be registered; and fixture filing is required
20 for priority over conflicting interests in fixtures to
21 the extent provided in Section 9-313;
22 (e) an assignment of accounts which does not alone
23 or in conjunction with other assignments to the same
24 assignee transfer a significant part of the outstanding
25 accounts of the assignor;
26 (f) a security interest of a collecting bank
27 (Section 4-208) or arising under the Article on Sales
28 (see Section 9-113) or covered in subsection (3) of this
29 Section;
30 (g) an assignment for the benefit of all creditors
31 of the transferor, and subsequent transfers by the
32 assignee thereunder;
33 (h) a security interest in investment property
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1 which is perfected without filing under Section 9-115 or
2 Section 9-116;
3 (i) a security interest in a deposit account. Such
4 a security interest is perfected:
5 (i) as to a deposit account maintained with
6 the secured party, when the security agreement is
7 executed;
8 (ii) as to a deposit account maintained with
9 any organization other than the secured party, when
10 notice thereof is given in writing to the
11 organization with whom the deposit account is
12 maintained and that organization provides written
13 acknowledgement of and consent to the notice of the
14 secured party.
15 (j) a security interest in an uncertificated
16 certificate of deposit. Such a security interest is
17 perfected;
18 (i) as to an uncertificated certificate of
19 deposit issued by the secured party, when the
20 security agreement is executed;
21 (ii) as to an uncertificated certificate of
22 deposit issued by any organization other than the
23 secured party, when notice thereof is given in
24 writing to the issuer of the uncertificated
25 certificate of deposit and the issuer provides
26 written acknowledgement of and consent to the notice
27 of the secured party.
28 (2) If a secured party assigns a perfected security
29 interest, no filing under this Article is required in order
30 to continue the perfected status of the security interest
31 against creditors of and transferees from the original
32 debtor.
33 (3) The filing of a financing statement otherwise
34 required by this Article is not necessary or effective to
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1 perfect a security interest in property subject to
2 (a) a statute or treaty of the United States which
3 provides for a national or international registration or
4 a national or international certificate of title or which
5 specifies a place of filing different from that specified
6 in this Article for filing of the security interest; or
7 (b) the following statutes of this State: the
8 Illinois Vehicle Code; the Boat Registration and Safety
9 Act; but during any period in which collateral is
10 inventory held for sale by a person who is in the
11 business of selling goods of that kind, the filing
12 provisions of this Article (Part 4) apply to a security
13 interest in that collateral created by him as debtor; or
14 (c) a certificate of title statute of another
15 jurisdiction under the law of which indication of a
16 security interest on the certificate is required as a
17 condition of perfection (subsection (2) of Section
18 9-103).
19 (4) Compliance with a statute or treaty described in
20 subsection (3) is equivalent to the filing of a financing
21 statement under this Article, and a security interest in
22 property subject to the statute or treaty can be perfected
23 only by compliance therewith except as provided in Section
24 9-103 on multiple state transactions. Duration and renewal of
25 perfection of a security interest perfected by compliance
26 with the statute or treaty are governed by the provisions of
27 the statute or treaty; in other respects the security
28 interest is subject to this Article.
29 (Source: P.A. 89-364, eff. 1-1-96.)
30 Section 99. Effective date. This Act takes effect upon
31 becoming law.