Office of the Revisor of Statutes
Minnesota Session Laws - 1999, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 105-S.F.No. 451
An act relating to agriculture; regulating security
interests in agricultural crops; modifying the
treatment of certain collateral; amending Minnesota
Statutes 1998, sections 336.9-203; 336.9-401; and
336.9-402.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 1998, section 336.9-203, is
amended to read:
336.9-203 [ATTACHMENT AND ENFORCEABILITY OF SECURITY
INTEREST; PROCEEDS; FORMAL REQUISITES.]
(1) Subject to the provisions of section 336.4-210 on the
security interest of a collecting bank, sections 336.9-115 and
336.9-116 on security interests in investment property and
section 336.9-113 on a security interest arising under the
article on sales, a security interest is not enforceable against
the debtor or third parties with respect to the collateral and
does not attach unless:
(a) the collateral is in the possession of the secured
party pursuant to agreement, the collateral is investment
property and the secured party has control pursuant to
agreement, or the debtor has signed a security agreement which
contains a description of the collateral and, in addition, when
the security interest covers crops growing or to be grown or
timber to be cut, a description of the land concerned;
(b) value has been given; and
(c) the debtor has rights in the collateral.
(2) A security interest attaches when it becomes
enforceable against the debtor with respect to the collateral.
Attachment occurs as soon as all of the events specified in
subsection (1) have taken place unless explicit agreement
postpones the time of attaching.
(3) Unless otherwise agreed a security agreement gives the
secured party the rights to proceeds provided by section
336.9-306.
(4) A transaction, although subject to this article, is
also subject to Minnesota Statutes, Sections 48.153 to 48.157;
Chapters 52, 53, and 56; and Sections 168.66 to 168.77, 222.13
to 222.16, and 334.01 to 334.06, and in the case of conflict
between the provisions of this article and any such statute, the
provisions of such statute control. Failure to comply with any
applicable statute has only the effect which is specified
therein.
Sec. 2. Minnesota Statutes 1998, section 336.9-401, is
amended to read:
336.9-401 [PLACE OF FILING; ERRONEOUS FILING; REMOVAL OF
COLLATERAL.]
(1) The proper place to file in order to perfect a security
interest is as follows:
(a) When the collateral is consumer goods, or motor
vehicles which are not covered by a certificate of title, then
in the office of the county recorder in the county of the
debtor's residence if the debtor is an individual who is a
resident of this state but if the debtor is an individual who is
not a resident of this state or is a corporation, partnership or
other organization then in the office of the secretary of state;
(b) When the collateral is equipment to be used in farming
operations, or farm products, or accounts or general intangibles
arising from or relating to the sale of farm products by a
farmer, or crops growing or to be grown, then in the office of
the county recorder in the county of the debtor's residence if
the debtor is an individual or organization with residence in
this state, but if the debtor is not a resident of this state,
then in the office of the secretary of state; security interests
covering crops growing or to be grown that are to be filed with
the county recorder under this paragraph must be filed in the
Uniform Commercial Code division of the recorder's office;
(c) When the collateral is timber to be cut or is minerals
or the like (including oil and gas) or accounts subject to
subsection (5) of section 336.9-103, or when the financing
statement is filed as a fixture filing (section 336.9-313) and
the collateral is goods which are or are to become fixtures,
then in the office where a mortgage on the real estate would be
filed or recorded;
(d) In all other cases, in the office of the secretary of
state.
(2) A filing which is made in good faith in an improper
place or not in all of the places required by this section is
nevertheless effective with regard to any collateral as to which
the filing complied with the requirements of this article and is
also effective with regard to collateral covered by the
financing statement against any person who has knowledge of the
contents of such financing statement.
(3) A filing which is made in the proper place in this
state continues effective even though the debtor's residence in
this state or the use of the collateral, whichever controlled
the original filing, is thereafter changed.
(4) The rules stated in section 336.9-103 determine whether
filing is necessary in this state.
(5) Notwithstanding the preceding subsections, the proper
place to file in order to perfect a security interest in
collateral, including fixtures, of a transmitting utility is the
office of the secretary of state. Such a filing shall not be
deemed a separate filing from the filings required by other
laws, if applicable, set forth in subsection (3) of section
336.9-302. This filing constitutes a fixture filing (section
336.9-313) as to the collateral described therein which is or is
to become fixtures.
(6) For the purposes of this section, the residence of an
organization is its place of business if it has one or its chief
executive office if it has more than one place of business.
(7) "Motor vehicle" means any device propelled or drawn by
any power other than muscular power in, upon, or by which any
person or property is or may be transported or drawn upon a
highway, excepting building and road construction equipment and
vehicles that are inventory of licensed dealers.
Sec. 3. Minnesota Statutes 1998, section 336.9-402, is
amended to read:
336.9-402 [FORMAL REQUISITES OF FINANCING STATEMENT;
AMENDMENTS; MORTGAGE AS FINANCING STATEMENT.]
(1) A financing statement is sufficient if it gives the
name of the debtor and the secured party, is signed by the
debtor, gives an address of the secured party from which
information concerning the security interest may be obtained,
gives a mailing address of the debtor, gives the social security
number of the debtor or, in the case of a debtor doing business
other than as an individual, the internal revenue service
taxpayer identification number of the debtor, and contains a
statement indicating the types or describing the items, of
collateral. A financing statement may be filed before a
security agreement is made or a security interest otherwise
attaches. When the financing statement covers crops growing or
to be grown, the statement must also contain a description of
the real estate concerned and the name of the record owner
thereof and the crop years that are covered by the financing
statement. When the financing statement covers timber to be cut
or covers minerals or the like (including oil and gas) or
accounts subject to subsection (5) of section 336.9-103, or when
the financing statement is filed as a fixture filing (section
336.9-313) and the collateral is goods which are or are to
become fixtures, the statement must also comply with subsection
(5). A copy of the security agreement is sufficient as a
financing statement if it contains the above information and is
signed by the debtor. A carbon, photographic or other
reproduction of a security agreement or a financing statement is
sufficient as a financing statement if the security agreement so
provides or if the original has been filed in this state.
(2) A financing statement which otherwise complies with
subsection (1) is sufficient when it is signed by the secured
party instead of the debtor when it is filed to perfect a
security interest in
(a) collateral already subject to a security interest in
another jurisdiction when it is brought into this state, or when
the debtor's location is changed to this state. Such a
financing statement must state that the collateral was brought
into this state or that the debtor's location was changed to
this state under such circumstances; or
(b) proceeds under section 336.9-306 if the security
interest in the original collateral was perfected. Such a
financing statement must describe the original collateral; or
(c) collateral as to which the filing has lapsed within one
year; or
(d) collateral acquired after a change of name, identity or
corporate structure of the debtor (subsection (7)); or
(e) a lien filed pursuant to chapter 514; or
(f) collateral which is subject to a filed judgment.
(2a) Except for documents filed under clauses (e) and (f),
the reason for the omission of the debtor signature must be
stated on the front of the financing statement.
(3) A form substantially as follows is sufficient to comply
with subsection (1):
Name of debtor (or assignor)
..............................
Address
..............................
Debtor's Social Security Number or I.R.S. Tax I.D. Number
...............................
Name of secured party (or assignee)
..............................
Address
..............................
1. This financing statement covers the following types (or
items) of property:
(Describe)
..............................
2. (If collateral is crops) The above described crops are
growing or are to be grown on:
(Describe real estate and the name of the record owner
thereof) ......
....................................................... ....
3. (If applicable) The above goods are to become fixtures
on
(Describe real estate).......................... and this
financing statement is to be filed for record in the real estate
records. (If the debtor does not have an interest of record)
The name of a record owner is .................
4. 3. (If products of collateral are claimed)
Products of the collateral are also covered.
Use whichever signature line is applicable.
Signature of debtor (or assignor)
.........................
Signature of secured party (or assignee)
.........................
(4) A financing statement may be amended by filing a
writing signed by both the debtor and the secured party. If the
sole purpose of the amendment is to change the name or address
of the secured party, only the secured party need sign the
amendment. A writing is sufficient if it sets forth the name
and address of the debtor and secured party as those items
appear on the original financing statement or the most recently
filed amendment, the file number and date of filing of the
financing statement. An amendment does not extend the period of
effectiveness of a financing statement. If any amendment adds
collateral, it is effective as to the added collateral only from
the filing date of the amendment. In this article, unless the
context otherwise requires, the term "financing statement" means
the original financing statement and any amendments.
(5) A financing statement covering timber to be cut or
covering minerals or the like (including oil and gas) or
accounts subject to subsection (5) of section 336.9-103, or a
financing statement filed as a fixture filing (section
336.9-313) where the debtor is not a transmitting utility, must
show that it covers this type of collateral, must recite that it
is to be filed for record in the real estate records, and the
financing statement must contain a description of the real
estate sufficient if it were contained in a mortgage of the real
estate to give constructive notice of the mortgage under the law
of this state. If the debtor does not have an interest of
record in the real estate, the financing statement must show the
name of a record owner. No description of the real estate or
the name of the record owner thereof is required for a fixture
filing where the debtor is a transmitting utility.
Notwithstanding the foregoing a general description of the real
estate is sufficient for a fixture filing where a railroad is
the record owner of the real estate on which the fixtures are or
are to be located; and for the purposes of this subsection, the
requirement of a general description is satisfied if the fixture
filing (1) identifies the section, township and range numbers of
the county in which the land is located; (2) identifies the
quarter-quarter of the section that the land is located in; (3)
indicates the name of the record owner of the real estate; and
(4) states the street address of the real estate if one exists.
(6) A mortgage is effective as a financing statement filed
as a fixture filing from the date of its recording if (a) the
goods are described in the mortgage by item or type, (b) the
goods are or are to become fixtures related to the real estate
described in the mortgage, (c) the mortgage complies with the
requirements for a financing statement in this section other
than a recital that it is to be filed in the real estate
records, and (d) the mortgage is duly recorded. No fee with
reference to the financing statement is required other than the
regular recording and satisfaction fees with respect to the
mortgage.
(7) A financing statement sufficiently shows the name of
the debtor if it gives the individual, partnership or corporate
name of the debtor, whether or not it adds other trade names or
the names of partners, and gives the social security number of
the debtor or, in the case of a debtor doing business other than
as an individual, the internal revenue service taxpayer
identification number of the debtor. Where the debtor so
changes a personal name or in the case of an organization its
name, identity or corporate structure that a filed financing
statement becomes seriously misleading, the filing is not
effective to perfect a security interest in collateral acquired
by the debtor more than four months after the change, unless a
new appropriate financing statement is filed before the
expiration of that time. A filed financing statement remains
effective with respect to collateral transferred by the debtor
even though the secured party knows of or consents to the
transfer.
(8) A financing statement, amendment, continuation,
assignment, release, or termination substantially complying with
the requirements of this section is effective even though it
contains minor errors which are not seriously misleading. The
omission or any inaccuracy in stating the debtor's social
security or federal tax identification number is not, standing
alone, a seriously misleading error.
Sec. 4. [EFFECTIVE DATE; APPLICABILITY.]
Sections 1 to 3 are effective August 1, 1999. Section 2
applies to security agreements signed on or after August 1,
1999. Section 3 applies to original financing statements filed
on or after August 1, 1999.
Presented to the governor April 23, 1999
Signed by the governor April 27, 1999, 11:23 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes