(810 ILCS 5/Art. 9 heading)
(810 ILCS 5/Art. 9 Pt. 1 heading)
(810 ILCS 5/Art. 9 Pt. 1 Sub. 1 heading)
(810 ILCS 5/9-101) (from Ch. 26, par. 9-101)
Sec. 9-101. Short title. This Article may be cited as Uniform Commercial Code - Secured Transactions.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-102) (from Ch. 26, par. 9-102)
Sec. 9-102. Definitions and index of definitions.
(a) Article 9 definitions. In this Article:
(b) Definitions in other Articles. "Control" as provided in Section 7-106 and the following definitions in other Articles apply to this Article:
"Applicant". Section 5-102.
"Beneficiary". Section 5-102.
"Broker". Section 8-102.
"Certificated security". Section 8-102.
"Check". Section 3-104.
"Clearing corporation". Section 8-102.
"Contract for sale". Section 2-106.
"Customer". Section 4-104.
"Entitlement holder". Section 8-102.
"Financial asset". Section 8-102.
"Holder in due course". Section 3-302.
"Issuer" (with respect to a letter of credit or letter-of-credit right). Section 5-102.
"Issuer" (with respect to a security). Section 8-201.
"Issuer" (with respect to documents of title). Section 7-102.
"Lease". Section 2A-103.
"Lease agreement". Section 2A-103.
"Lease contract". Section 2A-103.
"Leasehold interest". Section 2A-103.
"Lessee". Section 2A-103.
"Lessee in ordinary course of business". Section 2A-103.
"Lessor". Section 2A-103.
"Lessor's residual interest". Section 2A-103.
"Letter of credit". Section 5-102.
"Merchant". Section 2-104.
"Negotiable instrument". Section 3-104.
"Nominated person". Section 5-102.
"Note". Section 3-104.
"Proceeds of a letter of credit". Section 5-114.
"Prove". Section 3-103.
"Sale". Section 2-106.
"Securities account". Section 8-501.
"Securities intermediary". Section 8-102.
"Security". Section 8-102.
"Security certificate". Section 8-102.
"Security entitlement". Section 8-102.
"Uncertificated security". Section 8-102.
(c) Article 1 definitions and principles. Article 1 contains general definitions and principles of construction and interpretation applicable throughout this Article.
(Source: P.A. 97-1034, eff. 7-1-13; 98-749, eff. 7-16-14.)
(810 ILCS 5/9-103) (from Ch. 26, par. 9-103)
Sec. 9-103. Purchase-money security interest; application of payments; burden of establishing.
(a) Definitions. In this Section:
(b) Purchase-money security interest in goods. A security interest in goods is a purchase-money security interest:
(c) Purchase-money security interest in software. A security interest in software is a purchase-money security interest to the extent that the security interest also secures a purchase-money obligation incurred with respect to goods in which the secured party holds or held a purchase-money security interest if:
(d) Consignor's inventory purchase-money security interest. The security interest of a consignor in goods that are the subject of a consignment is a purchase-money security interest in inventory.
(e) Application of payment in non-consumer-goods transaction. In a transaction other than a consumer-goods transaction, if the extent to which a security interest is a purchase-money security interest depends on the application of a payment to a particular obligation, the payment must be applied:
(f) No loss of status of purchase-money security interest in non-consumer-goods transaction. In a transaction other than a consumer-goods transaction, a purchase-money security interest does not lose its status as such, even if:
(g) Burden of proof in non-consumer-goods transaction. In a transaction other than a consumer-goods transaction, a secured party claiming a purchase-money security interest has the burden of establishing the extent to which the security interest is a purchase-money security interest.
(h) Non-consumer-goods transactions; no inference. The limitation of the rules in subsections (e), (f), and (g) to transactions other than consumer-goods transactions is intended to leave to the court the determination of the proper rules in consumer-goods transactions. The court may not infer from that limitation the nature of the proper rule in consumer-goods transactions and may continue to apply established approaches.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-104) (from Ch. 26, par. 9-104)
Sec. 9-104. Control of deposit account.
(a) Requirements for control. A secured party has control of a deposit account if:
(b) Debtor's right to direct disposition. A secured party that has satisfied subsection (a) has control, even if the debtor retains the right to direct the disposition of funds from the deposit account.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-105) (from Ch. 26, par. 9-105)
Sec. 9-105. Control of electronic chattel paper.
(a) General rule: Control of electronic chattel paper. A secured party has control of electronic chattel paper if a system employed for evidencing the transfer of interests in the chattel paper reliably establishes the secured party as the person to which the chattel paper was assigned.
(b) Specific facts giving control. A system satisfies subsection (a) if the record or records comprising the chattel paper are created, stored, and assigned in such a manner that:
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-106) (from Ch. 26, par. 9-106)
Sec. 9-106. Control of investment property.
(a) Control under Section 8-106. A person has control of a certificated security, uncertificated security, or security entitlement as provided in Section 8-106.
(b) Control of commodity contract. A secured party has control of a commodity contract if:
(c) Effect of control of securities account or commodity account. A secured party having control of all security entitlements or commodity contracts carried in a securities account or commodity account has control over the securities account or commodity account.
(Source: P.A. 90-665, eff. 7-30-98; 91-893, eff. 7-1-01.)
(810 ILCS 5/9-107) (from Ch. 26, par. 9-107)
Sec. 9-107. Control of letter-of-credit right. A secured party has control of a letter-of-credit right to the extent of any right to payment or performance by the issuer or any nominated person if the issuer or nominated person has consented to an assignment of proceeds of the letter of credit under Section 5-114(c) or otherwise applicable law or practice.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-107.1)
Sec. 9-107.1. Control of Beneficial Interest in Illinois Land Trust.
(a) Requirements for Control. A secured party has control of the beneficial interest in an Illinois land trust if:
(b) Debtor's right to direct disposition and proceeds. A secured party that has satisfied subsection (a) has control, even if the debtor retains, subject to the terms and conditions of the collateral assignment or security agreement, the power of direction of the trustee and the right to receive the rents, income and profits thereof.
(Source: P.A. 92-234, eff. 1-1-02.)
(810 ILCS 5/9-108) (from Ch. 26, par. 9-108)
Sec. 9-108. Sufficiency of description.
(a) Sufficiency of description. Except as otherwise provided in subsections (c), (d), and (e), a description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
(b) Examples of reasonable identification. Except as otherwise provided in subsection (d), a description of collateral reasonably identifies the collateral if it identifies the collateral by:
(c) Supergeneric description not sufficient. A description of collateral as "all the debtor's assets" or "all the debtor's personal property" or using words of similar import does not reasonably identify the collateral.
(d) Investment property. Except as otherwise provided in subsection (e), a description of a security entitlement, securities account, or commodity account is sufficient if it describes:
(e) When description by type insufficient. A description only by type of collateral defined in the Uniform Commercial Code is an insufficient description of:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 1 Sub. 2 heading)
(810 ILCS 5/9-109) (from Ch. 26, par. 9-109)
Sec. 9-109. Scope.
(a) General scope of Article. Except as otherwise provided in subsections (c) and (d), this Article applies to:
(b) Security interest in secured obligation. The application of this Article to a security interest in a secured obligation is not affected by the fact that the obligation is itself secured by a transaction or interest to which this Article does not apply.
(c) Extent to which Article does not apply. This Article does not apply to the extent that:
(d) Inapplicability of Article. This Article does not apply to:
(Source: P.A. 91-893, eff. 7-1-01; 92-819, eff. 8-21-02.)
(810 ILCS 5/9-110) (from Ch. 26, par. 9-110)
Sec. 9-110. Security interests arising under Article 2 or 2A. A security interest arising under Section 2-401, 2-505, 2-711(3), or 2A-508(5) is subject to this Article. However, until the debtor obtains possession of the goods:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-112) (from Ch. 26, par. 9-112)
Sec. 9-112. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-113) (from Ch. 26, par. 9-113)
Sec. 9-113. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-114) (from Ch. 26, par. 9-114)
Sec. 9-114. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-115) (from Ch. 26, par. 9-115)
Sec. 9-115. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-116)
Sec. 9-116. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-150)
Sec. 9-150. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 2 heading)
(810 ILCS 5/Art. 9 Pt. 2 Sub. 1 heading)
(810 ILCS 5/9-201) (from Ch. 26, par. 9-201)
Sec. 9-201. General effectiveness of security agreement.
(a) General effectiveness. Except as otherwise provided in the Uniform Commercial Code, a security agreement is effective according to its terms between the parties, against purchasers of the collateral, and against creditors.
(b) Applicable consumer laws and other law. A transaction subject to this Article is subject to any applicable rule of law, statute, or regulation which establishes a different rule for consumers, including:
(c) Other applicable law controls. In case of conflict between this Article and a rule of law, statute, or regulation described in subsection (b), the rule of law, statute, or regulation controls. Failure to comply with a rule of law, statute, or regulation described in subsection (b) has only the effect such rule of law, statute, or regulation specifies.
(d) Further deference to other applicable law. This Article does not:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-202) (from Ch. 26, par. 9-202)
Sec. 9-202. Title to collateral immaterial. Except as otherwise provided with respect to consignments or sales of accounts, chattel paper, payment intangibles, or promissory notes, the provisions of this Article with regard to rights and obligations apply whether title to collateral is in the secured party or the debtor.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-203) (from Ch. 26, par. 9-203)
Sec. 9-203. Attachment and enforceability of security interest; proceeds; supporting obligations; formal requisites.
(a) Attachment. A security interest attaches to collateral when it becomes enforceable against the debtor with respect to the collateral, unless an agreement expressly postpones the time of attachment.
(b) Enforceability. Except as otherwise provided in subsections (c) through (i), a security interest is enforceable against the debtor and third parties with respect to the collateral only if:
(c) Other UCC provisions. Subsection (b) is subject to Section 4-210 on the security interest of a collecting bank, Section 5-118 on the security interest of a letter-of-credit issuer or nominated person, Section 9-110 on a security interest arising under Article 2 or 2A, and Section 9-206 on security interests in investment property.
(d) When person becomes bound by another person's security agreement. A person becomes bound as debtor by a security agreement entered into by another person if, by operation of law other than this Article or by contract:
(e) Effect of new debtor becoming bound. If a new debtor becomes bound as debtor by a security agreement entered into by another person:
(f) Proceeds and supporting obligations. The attachment of a security interest in collateral gives the secured party the rights to proceeds provided by Section 9-315 and is also attachment of a security interest in a supporting obligation for the collateral.
(g) Lien securing right to payment. The attachment of a security interest in a right to payment or performance secured by a security interest or other lien on personal or real property is also attachment of a security interest in the security interest, mortgage, or other lien.
(h) Security entitlement carried in securities account. The attachment of a security interest in a securities account is also attachment of a security interest in the security entitlements carried in the securities account.
(i) Commodity contracts carried in commodity account. The attachment of a security interest in a commodity account is also attachment of a security interest in the commodity contracts carried in the commodity account.
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-204) (from Ch. 26, par. 9-204)
Sec. 9-204. After-acquired property; future advances.
(a) After-acquired collateral. Except as otherwise provided in subsection (b), a security agreement may create or provide for a security interest in after-acquired collateral.
(b) When after-acquired property clause not effective. A security interest does not attach under a term constituting an after-acquired property clause to:
(c) Future advances and other value. A security agreement may provide that collateral secures, or that accounts, chattel paper, payment intangibles, or promissory notes are sold in connection with, future advances or other value, whether or not the advances or value are given pursuant to commitment.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-205) (from Ch. 26, par. 9-205)
Sec. 9-205. Use or disposition of collateral permissible.
(a) When security interest not invalid or fraudulent. A security interest is not invalid or fraudulent against creditors solely because:
(b) Requirements of possession not relaxed. This Section does not relax the requirements of possession if attachment, perfection, or enforcement of a security interest depends upon possession of the collateral by the secured party.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-205.1) (from Ch. 26, par. 9-205.1)
Sec. 9-205.1. Listing by debtor of purchasers or receivers of collateral. A secured party may require that the debtor include as part of the security agreement a list of persons to whom the debtor desires to sell or otherwise dispose of the collateral. The debtor shall not sell or otherwise dispose of the collateral to a person not included in that list unless the debtor has notified the secured party of his desire to sell or otherwise dispose of the collateral to such person at least 7 days prior to the sale or other disposition.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-206) (from Ch. 26, par. 9-206)
Sec. 9-206. Security interest arising in purchase or delivery of financial asset.
(a) Security interest when person buys through securities intermediary. A security interest in favor of a securities intermediary attaches to a person's security entitlement if:
(b) Security interest secures obligation to pay for financial asset. The security interest described in subsection (a) secures the person's obligation to pay for the financial asset.
(c) Security interest in payment against delivery transaction. A security interest in favor of a person that delivers a certificated security or other financial asset represented by a writing attaches to the security or other financial asset if:
(d) Security interest secures obligation to pay for delivery. The security interest described in subsection (c) secures the obligation to make payment for the delivery.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 2 Sub. 2 heading)
(810 ILCS 5/9-207) (from Ch. 26, par. 9-207)
Sec. 9-207. Rights and duties of secured party having possession or control of collateral.
(a) Duty of care when secured party in possession. Except as otherwise provided in subsection (d), a secured party shall use reasonable care in the custody and preservation of collateral in the secured party's possession. In the case of chattel paper or an instrument, reasonable care includes taking necessary steps to preserve rights against prior parties unless otherwise agreed.
(b) Expenses, risks, duties, and rights when secured party in possession. Except as otherwise provided in subsection (d), if a secured party has possession of collateral:
(c) Duties and rights when secured party in possession or control. Except as otherwise provided in subsection (d), a secured party having possession of collateral or control of collateral under Section 7-106, 9-104, 9-105, 9-106, or 9-107:
(d) Buyer of certain rights to payment. If the secured party is a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor:
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-208) (from Ch. 26, par. 9-208)
Sec. 9-208. Additional duties of secured party having control of collateral.
(a) Applicability of Section. This Section applies to cases in which there is no outstanding secured obligation and the secured party is not committed to make advances, incur obligations, or otherwise give value.
(b) Duties of secured party after receiving demand from debtor. Within 10 days after receiving an authenticated demand by the debtor:
(810 ILCS 5/9-209)
Sec. 9-209. Duties of secured party if account debtor has been notified of assignment.
(a) Applicability of Section. Except as otherwise provided in subsection (c), this Section applies if:
(b) Duties of secured party after receiving demand from debtor. Within 10 days after receiving an authenticated demand by the debtor, a secured party shall send to an account debtor that has received notification of an assignment to the secured party as assignee under Section 9-406(a) an authenticated record that releases the account debtor from any further obligation to the secured party.
(c) Inapplicability to sales. This Section does not apply to an assignment constituting the sale of an account, chattel paper, or payment intangible.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-210)
Sec. 9-210. Request for accounting; request regarding list of collateral or statement of account.
(a) Definitions. In this Section:
(b) Duty to respond to requests. Subject to subsections (c), (d), (e), and (f), a secured party, other than a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor, shall comply with a request within 14 days after receipt:
(c) Request regarding list of collateral; statement concerning type of collateral. A secured party that claims a security interest in all of a particular type of collateral owned by the debtor may comply with a request regarding a list of collateral by sending to the debtor an authenticated record including a statement to that effect within 14 days after receipt.
(d) Request regarding list of collateral; no interest claimed. A person that receives a request regarding a list of collateral, claims no interest in the collateral when it receives the request, and claimed an interest in the collateral at an earlier time shall comply with the request within 14 days after receipt by sending to the debtor an authenticated record:
(e) Request for accounting or regarding statement of account; no interest in obligation claimed. A person that receives a request for an accounting or a request regarding a statement of account, claims no interest in the obligations when it receives the request, and claimed an interest in the obligations at an earlier time shall comply with the request within 14 days after receipt by sending to the debtor an authenticated record:
(f) Charges for responses. A debtor is entitled without charge to one response to a request under this Section during any six-month period. The secured party may require payment of a charge not exceeding $25 for each additional response.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 3 heading)
(810 ILCS 5/Art. 9 Pt. 3 Sub. 1 heading)
(810 ILCS 5/9-301) (from Ch. 26, par. 9-301)
Sec. 9-301. Law governing perfection and priority of security interests. Except as otherwise provided in Sections 9-303 through 9-306.1, the following rules determine the law governing perfection, the effect of perfection or nonperfection, and the priority of a security interest in collateral:
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-302) (from Ch. 26, par. 9-302)
Sec. 9-302. Law governing perfection and priority of agricultural liens. While farm products are located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of an agricultural lien on the farm products.
(Source: P.A. 90-665, eff. 7-30-98; 91-893, eff. 7-1-01.)
(810 ILCS 5/9-303) (from Ch. 26, par. 9-303)
Sec. 9-303. Law governing perfection and priority of security interests in goods covered by a certificate of title.
(a) Applicability of Section. This Section applies to goods covered by a certificate of title, even if there is no other relationship between the jurisdiction under whose certificate of title the goods are covered and the goods or the debtor.
(b) When goods covered by certificate of title. Goods become covered by a certificate of title when a valid application for the certificate of title and the applicable fee are delivered to the appropriate authority. Goods cease to be covered by a certificate of title at the earlier of the time the certificate of title ceases to be effective under the law of the issuing jurisdiction or the time the goods become covered subsequently by a certificate of title issued by another jurisdiction.
(c) Applicable law. The local law of the jurisdiction under whose certificate of title the goods are covered governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in goods covered by a certificate of title from the time the goods become covered by the certificate of title until the goods cease to be covered by the certificate of title.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-304) (from Ch. 26, par. 9-304)
Sec. 9-304. Law governing perfection and priority of security interests in deposit accounts.
(a) Law of bank's jurisdiction governs. The local law of a bank's jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a deposit account maintained with that bank.
(b) Bank's jurisdiction. The following rules determine a bank's jurisdiction for purposes of this Part:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-305) (from Ch. 26, par. 9-305)
Sec. 9-305. Law governing perfection and priority of security interests in investment property.
(a) Governing law: general rules. Except as otherwise provided in subsection (c), the following rules apply:
(b) Commodity intermediary's jurisdiction. The following rules determine a commodity intermediary's jurisdiction for purposes of this Part:
(c) When perfection governed by law of jurisdiction where debtor located. The local law of the jurisdiction in which the debtor is located governs:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-306) (from Ch. 26, par. 9-306)
Sec. 9-306. Law governing perfection and priority of security interests in letter-of-credit rights.
(a) Governing law: issuer's or nominated person's jurisdiction. Subject to subsection (c), the local law of the issuer's jurisdiction or a nominated person's jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a letter-of-credit right if the issuer's jurisdiction or nominated person's jurisdiction is a State.
(b) Issuer's or nominated person's jurisdiction. For purposes of this Part, an issuer's jurisdiction or nominated person's jurisdiction is the jurisdiction whose law governs the liability of the issuer or nominated person with respect to the letter-of-credit right as provided in Section 5-116.
(c) When Section not applicable. This Section does not apply to a security interest that is perfected only under Section 9-308(d).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-306.01) (from Ch. 26, par. 9-306.01)
Sec. 9-306.01. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-306.02) (from Ch. 26, par. 9-306.02)
Sec. 9-306.02. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-306.1)
Sec. 9-306.1. Law Governing Perfection and Priority of Collateral Assignments of Beneficial Interests in Illinois Land Trusts. The local law of the State of Illinois governs perfection, the effect of perfection or nonperfection, and the priority of a collateral assignment of, or other security interest in, a beneficial interest in an Illinois land trust. This Section implements the important interest of this State in matters associated with the administration of Illinois land trusts created for the principal purpose of owning an interest in Illinois land and the regulation of restrictions on the transfer of beneficial interests in, and of the power of appointments under, such trusts.
(Source: P.A. 92-234, eff. 1-1-02.)
(810 ILCS 5/9-307) (from Ch. 26, par. 9-307)
Sec. 9-307. Location of debtor.
(a) "Place of business." In this Section, "place of business" means a place where a debtor conducts its affairs.
(b) Debtor's location: general rules. Except as otherwise provided in this Section, the following rules determine a debtor's location:
(c) Limitation of applicability of subsection (b). Subsection (b) applies only if a debtor's residence, place of business, or chief executive office, as applicable, is located in a jurisdiction whose law generally requires information concerning the existence of a nonpossessory security interest to be made generally available in a filing, recording, or registration system as a condition or result of the security interest's obtaining priority over the rights of a lien creditor with respect to the collateral. If subsection (b) does not apply, the debtor is located in the District of Columbia.
(d) Continuation of location: cessation of existence, etc. A person that ceases to exist, have a residence, or have a place of business continues to be located in the jurisdiction specified by subsections (b) and (c).
(e) Location of registered organization organized under State law. A registered organization that is organized under the law of a State is located in that State.
(f) Location of registered organization organized under federal law; bank branches and agencies. Except as otherwise provided in subsection (i), a registered organization that is organized under the law of the United States and a branch or agency of a bank that is not organized under the law of the United States or a State are located:
(g) Continuation of location: change in status of registered organization. A registered organization continues to be located in the jurisdiction specified by subsection (e) or (f) notwithstanding:
(h) Location of United States. The United States is located in the District of Columbia.
(i) Location of foreign bank branch or agency if licensed in only one State. A branch or agency of a bank that is not organized under the law of the United States or a State is located in the State in which the branch or agency is licensed, if all branches and agencies of the bank are licensed in only one State.
(j) Location of foreign air carrier. A foreign air carrier under the Federal Aviation Act of 1958, as amended, is located at the designated office of the agent upon which service of process may be made on behalf of the carrier.
(k) Section applies only to this Part. This Section applies only for purposes of this Part.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-307.1) (from Ch. 26, par. 9-307.1)
Sec. 9-307.1. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-307.2) (from Ch. 26, par. 9-307.2)
Sec. 9-307.2. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 3 Sub. 2 heading)
(810 ILCS 5/9-308) (from Ch. 26, par. 9-308)
Sec. 9-308. When security interest or agricultural lien is perfected; continuity of perfection.
(a) Perfection of security interest. Except as otherwise provided in this Section and Section 9-309, a security interest is perfected if it has attached and all of the applicable requirements for perfection in Sections 9-310 through 9-316 have been satisfied. A security interest is perfected when it attaches if the applicable requirements are satisfied before the security interest attaches.
(b) Perfection of agricultural lien. An agricultural lien is perfected if it has become effective and all of the applicable requirements for perfection in Section 9-310 have been satisfied. An agricultural lien is perfected when it becomes effective if the applicable requirements are satisfied before the agricultural lien becomes effective.
(c) Continuous perfection; perfection by different methods. A security interest or agricultural lien is perfected continuously if it is originally perfected by one method under this Article and is later perfected by another method under this Article, without an intermediate period when it was unperfected.
(d) Supporting obligation. Perfection of a security interest in collateral also perfects a security interest in a supporting obligation for the collateral.
(e) Lien securing right to payment. Perfection of a security interest in a right to payment or performance also perfects a security interest in a security interest, mortgage, or other lien on personal or real property securing the right.
(f) Security entitlement carried in securities account. Perfection of a security interest in a securities account also perfects a security interest in the security entitlements carried in the securities account.
(g) Commodity contract carried in commodity account. Perfection of a security interest in a commodity account also perfects a security interest in the commodity contracts carried in the commodity account.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-309) (from Ch. 26, par. 9-309)
Sec. 9-309. Security interest perfected upon attachment. The following security interests are perfected when they attach:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-310) (from Ch. 26, par. 9-310)
Sec. 9-310. When filing required to perfect security interest or agricultural lien; security interests and agricultural liens to which filing provisions do not apply.
(a) General rule: perfection by filing. Except as otherwise provided in subsection (b) and Section 9-312(b), a financing statement must be filed to perfect all security interests and agricultural liens.
(b) Exceptions: filing not necessary. The filing of a financing statement is not necessary to perfect a security interest:
(c) Assignment of perfected security interest. If a secured party assigns a perfected security interest or agricultural lien, a filing under this Article is not required to continue the perfected status of the security interest against creditors of and transferees from the original debtor.
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-311) (from Ch. 26, par. 9-311)
Sec. 9-311. Perfection of security interests in property subject to certain statutes, regulations, and treaties.
(a) Security interest subject to other law. Except as otherwise provided in subsection (d), the filing of a financing statement is not necessary or effective to perfect a security interest in property subject to:
(b) Compliance with other law. Compliance with the requirements of a statute, regulation, or treaty described in subsection (a) for obtaining priority over the rights of a lien creditor is equivalent to the filing of a financing statement under this Article. Except as otherwise provided in subsection (d) and Sections 9-313 and 9-316(d) and (e) for goods covered by a certificate of title, a security interest in property subject to a statute, regulation, or treaty described in subsection (a) may be perfected only by compliance with those requirements, and a security interest so perfected remains perfected notwithstanding a change in the use or transfer of possession of the collateral.
(c) Duration and renewal of perfection. Except as otherwise provided in subsection (d) and Section 9-316(d) and (e), duration and renewal of perfection of a security interest perfected by compliance with the requirements prescribed by a statute, regulation, or treaty described in subsection (a) are governed by the statute, regulation, or treaty. In other respects, the security interest is subject to this Article.
(d) Inapplicability to certain inventory. During any period in which collateral subject to a statute specified in subsection (a)(2) is inventory held for sale or lease by a person or leased by that person as lessor and that person is in the business of selling or leasing goods of that kind, this Section does not apply to a security interest in that collateral created by that person as debtor.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-312) (from Ch. 26, par. 9-312)
Sec. 9-312. Perfection of security interests in chattel paper, deposit accounts, documents, goods covered by documents, instruments, investment property, letter-of-credit rights, and money; perfection by permissive filing; temporary perfection without filing or transfer of possession.
(a) Perfection by filing permitted. A security interest in chattel paper, negotiable documents, instruments, beneficial interests in Illinois land trusts, or investment property may be perfected by filing.
(b) Control or possession of certain collateral. Except as otherwise provided in Section 9-315(c) and (d) for proceeds:
(c) Goods covered by negotiable document. While goods are in the possession of a bailee that has issued a negotiable document covering the goods:
(d) Goods covered by nonnegotiable document. While goods are in the possession of a bailee that has issued a nonnegotiable document covering the goods, a security interest in the goods may be perfected by:
(e) Temporary perfection: new value. A security interest in certificated securities, negotiable documents, or instruments is perfected without filing or the taking of possession or control for a period of 20 days from the time it attaches to the extent that it arises for new value given under an authenticated security agreement.
(f) Temporary perfection: goods or documents made available to debtor. A perfected security interest in a negotiable document or goods in possession of a bailee, other than one that has issued a negotiable document for the goods, remains perfected for 20 days without filing if the secured party makes available to the debtor the goods or documents representing the goods for the purpose of:
(g) Temporary perfection: delivery of security certificate or instrument to debtor. A perfected security interest in a certificated security or instrument remains perfected for 20 days without filing if the secured party delivers the security certificate or instrument to the debtor for the purpose of:
(h) Expiration of temporary perfection. After the 20-day period specified in subsection (e), (f), or (g) expires, perfection depends upon compliance with this Article.
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-313) (from Ch. 26, par. 9-313)
Sec. 9-313. When possession by or delivery to secured party perfects security interest without filing.
(a) Perfection by possession or delivery. Except as otherwise provided in subsection (b), a secured party may perfect a security interest in tangible negotiable documents, goods, instruments, money, or tangible chattel paper by taking possession of the collateral. A secured party may perfect a security interest in certificated securities by taking delivery of the certificated securities under Section 8-301.
(b) Goods covered by certificate of title. With respect to goods covered by a certificate of title issued by this State, a secured party may perfect a security interest in the goods by taking possession of the goods only in the circumstances described in Section 9-316(d).
(c) Collateral in possession of person other than debtor. With respect to collateral other than certificated securities and goods covered by a document, a secured party takes possession of collateral in the possession of a person other than the debtor, the secured party, or a lessee of the collateral from the debtor in the ordinary course of the debtor's business, when:
(d) Time of perfection by possession; continuation of perfection. If perfection of a security interest depends upon possession of the collateral by a secured party, perfection occurs no earlier than the time the secured party takes possession and continues only while the secured party retains possession.
(e) Time of perfection by delivery; continuation of perfection. A security interest in a certificated security in registered form is perfected by delivery when delivery of the certificated security occurs under Section 8-301 and remains perfected by delivery until the debtor obtains possession of the security certificate.
(f) Acknowledgment not required. A person in possession of collateral is not required to acknowledge that it holds possession for a secured party's benefit.
(g) Effectiveness of acknowledgment; no duties or confirmation. If a person acknowledges that it holds possession for the secured party's benefit:
(h) Secured party's delivery to person other than debtor. A secured party having possession of collateral does not relinquish possession by delivering the collateral to a person other than the debtor or a lessee of the collateral from the debtor in the ordinary course of the debtor's business if the person was instructed before the delivery or is instructed contemporaneously with the delivery:
(i) Effect of delivery under subsection (h); no duties or confirmation. A secured party does not relinquish possession, even if a delivery under subsection (h) violates the rights of a debtor. A person to which collateral is delivered under subsection (h) does not owe any duty to the secured party and is not required to confirm the delivery to another person unless the person otherwise agrees or law other than this Article otherwise provides.
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-314) (from Ch. 26, par. 9-314)
Sec. 9-314. Perfection by control.
(a) Perfection by control. A security interest in investment property, deposit accounts, electronic chattel paper, letter-of-credit rights, electronic documents, or beneficial interests in Illinois land trusts may be perfected by control of the collateral under Section 7-106, 9-104, 9-105, 9-106, 9-107, or 9-107.1.
(b) Specified collateral: time of perfection by control; continuation of perfection. A security interest in deposit accounts, electronic chattel paper, letter-of-credit rights, electronic documents, or beneficial interests in Illinois land trusts is perfected by control under Section 7-106, 9-104, 9-105, 9-107, or 9-107.1 when the secured party obtains control and remains perfected by control only while the secured party retains control.
(c) Investment property: time of perfection by control; continuation of perfection. A security interest in investment property is perfected by control under Section 9-106 from the time the secured party obtains control and remains perfected by control until:
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-315) (from Ch. 26, par. 9-315)
Sec. 9-315. Secured party's rights on disposition of collateral and in proceeds.
(a) Disposition of collateral: continuation of security interest or agricultural lien; proceeds. Except as otherwise provided in this Article and in Section 2-403(2):
(b) When commingled proceeds identifiable. Proceeds that are commingled with other property are identifiable proceeds:
(c) Perfection of security interest in proceeds. A security interest in proceeds is a perfected security interest if the security interest in the original collateral was perfected.
(d) Continuation of perfection. A perfected security interest in proceeds becomes unperfected on the 21st day after the security interest attaches to the proceeds unless:
(e) When perfected security interest in proceeds becomes unperfected. If a filed financing statement covers the original collateral, a security interest in proceeds which remains perfected under subsection (d)(1) becomes unperfected at the later of:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-315.01)
Sec. 9-315.01. Debtor disposing of collateral and failing to pay secured party amount due under security agreement; penalties for violation.
(1) It is unlawful for a debtor under the terms of a security agreement (a) who has no right of sale or other disposition of the collateral or (b) who has a right of sale or other disposition of the collateral and is to account to the secured party for the proceeds of any sale or other disposition of the collateral, to sell or otherwise dispose of the collateral and willfully and wrongfully to fail to pay the secured party the amount of said proceeds due under the security agreement. Failure to pay such proceeds to the secured party within 10 days after the sale or other disposition of the collateral is prima facie evidence of a willful and wanton failure to pay.
(2) An individual convicted of a violation of this Section shall be guilty of a Class 3 felony.
(3) A corporation convicted of a violation of this Section shall be guilty of a business offense and shall be fined not less than $2,000 nor more than $10,000.
(4) In the event the debtor under the terms of a security agreement is a corporation or a partnership, any officer, director, manager, or managerial agent of the debtor who violates this Section or causes the debtor to violate this Section shall be guilty of a Class 3 felony.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-315.02)
Sec. 9-315.02. Disposal of collateral by debtor to persons other than those previously disclosed to secured party - penalties for violation - defense.
(1) Where, pursuant to Section 9-205.1, a secured party has required that before the debtor sells or otherwise disposes of collateral in the debtor's possession he disclose to the secured party the persons to whom he desires to sell or otherwise dispose of such collateral, it is unlawful for the debtor to sell or otherwise dispose of the collateral to a person other than a person so disclosed to the secured party.
(2) An individual convicted of a violation of this Section shall be guilty of a Class A misdemeanor.
(3) A corporation convicted of a violation of this Section shall be guilty of a business offense and shall be fined not less than $2,000 nor more than $10,000.
(4) In the event the debtor under the terms of a security agreement is a corporation or a partnership, any officer, director, manager, or managerial agent of the debtor who violates this Section or causes the debtor to violate this Section shall be guilty of a Class A misdemeanor.
(5) It is an affirmative defense to a prosecution for the violation of this Section that the debtor has paid to the secured party the proceeds from the sale or other disposition of the collateral within 10 days after such sale or disposition.
(Source: P.A. 91-893, eff. 7-1-01; 92-16, eff. 6-28-01.)
(810 ILCS 5/9-316) (from Ch. 26, par. 9-316)
Sec. 9-316. Effect of change in governing law.
(a) General rule: effect on perfection of change in governing law. A security interest perfected pursuant to the law of the jurisdiction designated in Section 9-301(1) or 9-305(c) remains perfected until the earliest of:
(b) Security interest perfected or unperfected under law of new jurisdiction. If a security interest described in subsection (a) becomes perfected under the law of the other jurisdiction before the earliest time or event described in that subsection, it remains perfected thereafter. If the security interest does not become perfected under the law of the other jurisdiction before the earliest time or event, it becomes unperfected and is deemed never to have been perfected as against a purchaser of the collateral for value.
(c) Possessory security interest in collateral moved to new jurisdiction. A possessory security interest in collateral, other than goods covered by a certificate of title and as-extracted collateral consisting of goods, remains continuously perfected if:
(d) Goods covered by certificate of title from this State. Except as otherwise provided in subsection (e), a security interest in goods covered by a certificate of title which is perfected by any method under the law of another jurisdiction when the goods become covered by a certificate of title from this State remains perfected until the security interest would have become unperfected under the law of the other jurisdiction had the goods not become so covered.
(e) When subsection (d) security interest becomes unperfected against purchasers. A security interest described in subsection (d) becomes unperfected as against a purchaser of the goods for value and is deemed never to have been perfected as against a purchaser of the goods for value if the applicable requirements for perfection under Section 9-311(b) or 9-313 are not satisfied before the earlier of:
(f) Change in jurisdiction of bank, issuer, nominated person, securities intermediary, or commodity intermediary. A security interest in deposit accounts, letter-of-credit rights, or investment property which is perfected under the law of the bank's jurisdiction, the issuer's jurisdiction, a nominated person's jurisdiction, the securities intermediary's jurisdiction, or the commodity intermediary's jurisdiction, as applicable, remains perfected until the earlier of:
(g) Subsection (f) security interest perfected or unperfected under law of new jurisdiction. If a security interest described in subsection (f) becomes perfected under the law of the other jurisdiction before the earlier of the time or the end of the period described in that subsection, it remains perfected thereafter. If the security interest does not become perfected under the law of the other jurisdiction before the earlier of that time or the end of that period, it becomes unperfected and is deemed never to have been perfected as against a purchaser of the collateral for value.
(h) Effect on filed financing statement of change in governing law. The following rules apply to collateral to which a security interest attaches within four months after the debtor changes its location to another jurisdiction:
(i) Effect of change in governing law on financing statement filed against original debtor. If a financing statement naming an original debtor is filed pursuant to the law of the jurisdiction designated in Section 9-301(1) or 9-305(c) and the new debtor is located in another jurisdiction, the following rules apply:
(810 ILCS 5/Art. 9 Pt. 3 Sub. 3 heading)
(810 ILCS 5/9-317) (from Ch. 26, par. 9-317)
Sec. 9-317. Interests that take priority over or take free of security interest or agricultural lien.
(a) Conflicting security interests and rights of lien creditors. A security interest or agricultural lien is subordinate to the rights of:
(b) Buyers that receive delivery. Except as otherwise provided in subsection (e), a buyer, other than a secured party, of tangible chattel paper, tangible documents, goods, instruments, or a certificated security takes free of a security interest or agricultural lien if the buyer gives value and receives delivery of the collateral without knowledge of the security interest or agricultural lien and before it is perfected.
(c) Lessees that receive delivery. Except as otherwise provided in subsection (e), a lessee of goods takes free of a security interest or agricultural lien if the lessee gives value and receives delivery of the collateral without knowledge of the security interest or agricultural lien and before it is perfected.
(d) Licensees and buyers of certain collateral. A licensee of a general intangible or a buyer, other than a secured party, of collateral other than tangible chattel paper, tangible documents, goods, instruments, or a certificated security takes free of a security interest if the licensee or buyer gives value without knowledge of the security interest and before it is perfected.
(e) Purchase-money security interest. Except as otherwise provided in Sections 9-320 and 9-321, if a person files a financing statement with respect to a purchase-money security interest before or within 20 days after the debtor receives delivery of the collateral, the security interest takes priority over the rights of a buyer, lessee, or lien creditor which arise between the time the security interest attaches and the time of filing.
(f) Public deposits. An unperfected security interest shall take priority over the rights of a lien creditor if (i) the lien creditor is a trustee or receiver of a bank or acting in furtherance of its supervisory authority over such bank and (ii) a security interest is granted by the bank to secure a deposit of public funds with the bank or a repurchase agreement with the bank pursuant to the Government Securities Act of 1986, as amended.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-318) (from Ch. 26, par. 9-318)
Sec. 9-318. No interest retained in right to payment that is sold; rights and title of seller of account or chattel paper with respect to creditors and purchasers.
(a) Seller retains no interest. A debtor that has sold an account, chattel paper, payment intangible, or promissory note does not retain a legal or equitable interest in the collateral sold.
(b) Deemed rights of debtor if buyer's security interest unperfected. For purposes of determining the rights of creditors of, and purchasers for value of an account or chattel paper from, a debtor that has sold an account or chattel paper, while the buyer's security interest is unperfected, the debtor is deemed to have rights and title to the account or chattel paper identical to those the debtor sold.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-319)
Sec. 9-319. Rights and title of consignee with respect to creditors and purchasers.
(a) Consignee has consignor's rights. Except as otherwise provided in subsection (b), for purposes of determining the rights of creditors of, and purchasers for value of goods from, a consignee, while the goods are in the possession of the consignee, the consignee is deemed to have rights and title to the goods identical to those the consignor had or had power to transfer.
(b) Applicability of other law. For purposes of determining the rights of a creditor of a consignee, law other than this Article determines the rights and title of a consignee while goods are in the consignee's possession if, under this Part, a perfected security interest held by the consignor would have priority over the rights of the creditor.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-320)
Sec. 9-320. Buyer of goods and farm products.
(a) Buyer in ordinary course of business. Except as otherwise provided in subsections (e) and (f), a buyer in the ordinary course of business takes free of a security interest created by the buyer's seller, even if the security interest is perfected and the buyer knows of its existence.
(b) Buyer of consumer goods. Except as otherwise provided in subsection (e), a buyer of goods from a person who used or bought the goods for use primarily for personal, family, or household purposes takes free of a security interest, even if perfected, if the buyer buys:
(c) Effectiveness of filing for subsection (b). To the extent that it affects the priority of a security interest over a buyer of goods under subsection (b), the period of effectiveness of a filing made in the jurisdiction in which the seller is located is governed by Section 9-316(a) and (b).
(d) Buyer in ordinary course of business at wellhead or minehead. A buyer in ordinary course of business buying oil, gas, or other minerals at the wellhead or minehead or after extraction takes free of an interest arising out of an encumbrance.
(e) Possessory security interest not affected. Subsections (a) and (b) do not affect a security interest in goods in the possession of the secured party under Section 9-313.
(f) Buyer of farm products.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-320.1)
Sec. 9-320.1. Liability of commission merchant or selling agent engaged in sale of livestock or other farm products to holder of security interest.
(a) A commission merchant or selling agent who sells a farm product for others shall be subject to a security interest created by the seller in such farm product if:
(b) For the purposes of this Section, a commission merchant or selling agent has received notice from the secured party or seller when written notice of the security interest is sent to the commission merchant or selling agent by registered or certified mail.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-320.2)
Sec. 9-320.2. Notice to seller of farm products. A commission merchant or selling agent who sells farm products for others, and any person buying farm products in the ordinary course of business from a person engaged in farming operations, shall post at each licensed location where the merchant, agent, or person buying farm products in the ordinary course of business does business a notice that shall read as follows:
It is a criminal offense to sell farm products subject to a security interest without making payment to the secured party. You should notify the purchaser if there is a security interest in the farm products you are selling.".
The notice shall be posted in a conspicuous manner and shall be in contrasting type, large enough to be read from a distance of 10 feet.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-321)
Sec. 9-321. Licensee of general intangible and lessee of goods in ordinary course of business.
(a) "Licensee in ordinary course of business." In this Section, "licensee in ordinary course of business" means a person that becomes a licensee of a general intangible in good faith, without knowledge that the license violates the rights of another person in the general intangible, and in the ordinary course from a person in the business of licensing general intangibles of that kind. A person becomes a licensee in the ordinary course if the license to the person comports with the usual or customary practices in the kind of business in which the licensor is engaged or with the licensor's own usual or customary practices.
(b) Rights of licensee in ordinary course of business. A licensee in ordinary course of business takes its rights under a nonexclusive license free of a security interest in the general intangible created by the licensor, even if the security interest is perfected and the licensee knows of its existence.
(c) Rights of lessee in ordinary course of business. A lessee in ordinary course of business takes its leasehold interest free of a security interest in the goods created by the lessor, even if the security interest is perfected and the lessee knows of its existence.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-322)
Sec. 9-322. Priorities among conflicting security interests in and agricultural liens on same collateral.
(a) General priority rules. Except as otherwise provided in this Section, priority among conflicting security interests and agricultural liens in the same collateral is determined according to the following rules:
(b) Time of perfection: proceeds and supporting obligations. For the purposes of subsection (a)(1):
(c) Special priority rules: proceeds and supporting obligations. Except as otherwise provided in subsection (f), a security interest in collateral which qualifies for priority over a conflicting security interest under Section 9-327, 9-328, 9-329, 9-329.1, 9-330, or 9-331 also has priority over a conflicting security interest in:
(d) First-to-file priority rule for certain collateral. Subject to subsection (e) and except as otherwise provided in subsection (f), if a security interest in chattel paper, deposit accounts, negotiable documents, instruments, investment property, letter-of-credit rights, or beneficial interests in Illinois land trusts is perfected by a method other than filing, conflicting perfected security interests in proceeds of the collateral rank according to priority in time of filing.
(e) Applicability of subsection (d). Subsection (d) applies only if the proceeds of the collateral are not cash proceeds, chattel paper, negotiable documents, instruments, investment property, beneficial interests in Illinois land trusts, or letter-of-credit rights.
(f) Limitations on subsections (a) through (e). Subsections (a) through (e) are subject to:
(g) Priority under agricultural lien statute. A perfected agricultural lien on collateral has priority over a conflicting security interest in or agricultural lien on the same collateral if the statute creating the agricultural lien so provides.
(Source: P.A. 91-893, eff. 7-1-01; 92-234, eff. 1-1-02.)
(810 ILCS 5/9-323)
Sec. 9-323. Future advances.
(a) When priority based on time of advance. Except as otherwise provided in subsection (c), for purposes of determining the priority of a perfected security interest under Section 9-322(a)(1), perfection of the security interest dates from the time an advance is made to the extent that the security interest secures an advance that:
(b) Lien creditor. Except as otherwise provided in subsection (c), a security interest is subordinate to the rights of a person that becomes a lien creditor to the extent that the security interest secures an advance made more than 45 days after the person becomes a lien creditor unless the advance is made:
(c) Buyer of receivables. Subsections (a) and (b) do not apply to a security interest held by a secured party that is a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor.
(d) Buyer of goods. Except as otherwise provided in subsection (e), a buyer of goods other than a buyer in ordinary course of business takes free of a security interest to the extent that it secures advances made after the earlier of:
(e) Advances made pursuant to commitment: priority of buyer of goods. Subsection (d) does not apply if the advance is made pursuant to a commitment entered into without knowledge of the buyer's purchase and before the expiration of the 45-day period.
(f) Lessee of goods. Except as otherwise provided in subsection (g), a lessee of goods, other than a lessee in ordinary course of business, takes the leasehold interest free of a security interest to the extent that it secures advances made after the earlier of:
(g) Advances made pursuant to commitment: priority of lessee of goods. Subsection (f) does not apply if the advance is made pursuant to a commitment entered into without knowledge of the lease and before the expiration of the 45-day period.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-324)
Sec. 9-324. Priority of purchase-money security interests.
(a) General rule: purchase-money priority. Except as otherwise provided in subsection (g), a perfected purchase-money security interest in goods other than inventory or livestock has priority over a conflicting security interest in the same goods, and, except as otherwise provided in Section 9-327, a perfected security interest in its identifiable proceeds also has priority, if the purchase-money security interest is perfected when the debtor receives possession of the collateral or within 20 days thereafter.
(b) Inventory purchase-money priority. Subject to subsection (c) and except as otherwise provided in subsection (g), a perfected purchase-money security interest in inventory has priority over a conflicting security interest in the same inventory, has priority over a conflicting security interest in chattel paper or an instrument constituting proceeds of the inventory and in proceeds of the chattel paper, if so provided in Section 9-330, and, except as otherwise provided in Section 9-327, also has priority in identifiable cash proceeds of the inventory to the extent the identifiable cash proceeds are received on or before the delivery of the inventory to a buyer, if:
(c) Holders of conflicting inventory security interests to be notified. Subsections (b)(2) through (4) apply only if the holder of the conflicting security interest had filed a financing statement covering the same types of inventory:
(d) Livestock purchase-money priority. Subject to subsection (e) and except as otherwise provided in subsection (g), a perfected purchase-money security interest in livestock that are farm products has priority over a conflicting security interest in the same livestock, and, except as otherwise provided in Section 9-327, a perfected security interest in their identifiable proceeds and identifiable products in their unmanufactured states also has priority, if:
(e) Holders of conflicting livestock security interests to be notified. Subsections (d)(2) through (4) apply only if the holder of the conflicting security interest had filed a financing statement covering the same types of livestock:
(f) Software purchase-money priority. Except as otherwise provided in subsection (g), a perfected purchase-money security interest in software has priority over a conflicting security interest in the same collateral, and, except as otherwise provided in Section 9-327, a perfected security interest in its identifiable proceeds also has priority, to the extent that the purchase-money security interest in the goods in which the software was acquired for use has priority in the goods and proceeds of the goods under this Section.
(g) Conflicting purchase-money security interests. If more than one security interest qualifies for priority in the same collateral under subsection (a), (b), (d), or (f):
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-325)
Sec. 9-325. Priority of security interests in transferred collateral.
(a) Subordination of security interest in transferred collateral. Except as otherwise provided in subsection (b), a security interest created by a debtor is subordinate to a security interest in the same collateral created by another person if:
(b) Limitation of subsection (a) subordination. Subsection (a) subordinates a security interest only if the security interest:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-326)
Sec. 9-326. Priority of security interests created by new debtor.
(a) Subordination of security interest created by new debtor. Subject to subsection (b), a security interest that is created by a new debtor in collateral in which the new debtor has or acquires rights and is perfected solely by a filed financing statement that would be ineffective to perfect the security interest but for the application of Section 9-316(i)(1) or 9-508 is subordinate to a security interest in the same collateral which is perfected other than by such a filed financing statement.
(b) Priority under other provisions; multiple original debtors. The other provisions of this Part determine the priority among conflicting security interests in the same collateral perfected by filed financing statements described in subsection (a). However, if the security agreements to which a new debtor became bound as debtor were not entered into by the same original debtor, the conflicting security interests rank according to priority in time of the new debtor's having become bound.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-327)
Sec. 9-327. Priority of security interests in deposit account. The following rules govern priority among conflicting security interests in the same deposit account:
(1) A security interest held by a secured party having control of the deposit account under Section 9-104 has priority over a conflicting security interest held by a secured party that does not have control.
(2) Except as otherwise provided in paragraphs (3) and (4), security interests perfected by control under Section 9-314 rank according to priority in time of obtaining control.
(3) Except as otherwise provided in paragraph (4), a security interest held by the bank with which the deposit account is maintained has priority over a conflicting security interest held by another secured party.
(4) A security interest perfected by control under Section 9-104(a)(3) has priority over a security interest held by the bank with which the deposit account is maintained.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-328)
Sec. 9-328. Priority of security interests in investment property. The following rules govern priority among conflicting security interests in the same investment property:
(1) A security interest held by a secured party having control of investment property under Section 9-106 has priority over a security interest held by a secured party that does not have control of the investment property.
(2) Except as otherwise provided in paragraphs (3) and (4), conflicting security interests held by secured parties each of which has control under Section 9-106 rank according to priority in time of:
(3) A security interest held by a securities intermediary in a security entitlement or a securities account maintained with the securities intermediary has priority over a conflicting security interest held by another secured party.
(4) A security interest held by a commodity intermediary in a commodity contract or a commodity account maintained with the commodity intermediary has priority over a conflicting security interest held by another secured party.
(5) A security interest in a certificated security in registered form which is perfected by taking delivery under Section 9-313(a) and not by control under Section 9-314 has priority over a conflicting security interest perfected by a method other than control.
(6) Conflicting security interests created by a broker, securities intermediary, or commodity intermediary which are perfected without control under Section 9-106 rank equally.
(7) In all other cases, priority among conflicting security interests in investment property is governed by Sections 9-322 and 9-323.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-329)
Sec. 9-329. Priority of security interests in letter-of-credit right. The following rules govern priority among conflicting security interests in the same letter-of-credit right:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-329.1)
Sec. 9-329.1. Priority of Security Interests in Beneficial Interest in an Illinois Land Trust. The following rules govern priority among conflicting security interests in the same beneficial interest in an Illinois land trust:
(Source: P.A. 92-234, eff. 1-1-02.)
(810 ILCS 5/9-330)
Sec. 9-330. Priority of purchaser of chattel paper or instrument.
(a) Purchaser's priority: security interest claimed merely as proceeds. A purchaser of chattel paper has priority over a security interest in the chattel paper which is claimed merely as proceeds of inventory subject to a security interest if:
(b) Purchaser's priority: other security interests. A purchaser of chattel paper has priority over a security interest in the chattel paper which is claimed other than merely as proceeds of inventory subject to a security interest if the purchaser gives new value and takes possession of the chattel paper or obtains control of the chattel paper under Section 9-105 in good faith, in the ordinary course of the purchaser's business, and without knowledge that the purchase violates the rights of the secured party.
(c) Chattel paper purchaser's priority in proceeds. Except as otherwise provided in Section 9-327, a purchaser having priority in chattel paper under subsection (a) or (b) also has priority in proceeds of the chattel paper to the extent that:
(d) Instrument purchaser's priority. Except as otherwise provided in Section 9-331(a), a purchaser of an instrument has priority over a security interest in the instrument perfected by a method other than possession if the purchaser gives value and takes possession of the instrument in good faith and without knowledge that the purchase violates the rights of the secured party.
(e) Holder of purchase-money security interest gives new value. For purposes of subsections (a) and (b), the holder of a purchase-money security interest in inventory gives new value for chattel paper constituting proceeds of the inventory.
(f) Indication of assignment gives knowledge. For purposes of subsections (b) and (d), if chattel paper or an instrument indicates that it has been assigned to an identified secured party other than the purchaser, a purchaser of the chattel paper or instrument has knowledge that the purchase violates the rights of the secured party.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-331)
Sec. 9-331. Priority of rights of purchasers of instruments, documents, and securities under other Articles; priority of interests in financial assets and security entitlements under Article 8.
(a) Rights under Articles 3, 7, and 8 not limited. This Article does not limit the rights of a holder in due course of a negotiable instrument, a holder to which a negotiable document of title has been duly negotiated, or a protected purchaser of a security. These holders or purchasers take priority over an earlier security interest, even if perfected, to the extent provided in Articles 3, 7, and 8.
(b) Protection under Article 8. This Article does not limit the rights of or impose liability on a person to the extent that the person is protected against the assertion of a claim under Article 8.
(c) Filing not notice. Filing under this Article does not constitute notice of a claim or defense to the holders, or purchasers, or persons described in subsections (a) and (b).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-332)
Sec. 9-332. Transfer of money; transfer of funds from deposit account.
(a) Transferee of money. A transferee of money takes the money free of a security interest unless the transferee acts in collusion with the debtor in violating the rights of the secured party.
(b) Transferee of funds from deposit account. A transferee of funds from a deposit account takes the funds free of a security interest in the deposit account unless the transferee acts in collusion with the debtor in violating the rights of the secured party.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-333)
Sec. 9-333. Priority of certain liens arising by operation of law.
(a) "Possessory lien." In this Section, "possessory lien" means an interest, other than a security interest or an agricultural lien:
(b) Priority of possessory lien. A possessory lien on goods has priority over a security interest in the goods unless the lien is created by a statute that expressly provides otherwise.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-334)
Sec. 9-334. Priority of security interests in fixtures and crops.
(a) Security interest in fixtures under this Article. A security interest under this Article may be created in goods that are fixtures or may continue in goods that become fixtures. A security interest does not exist under this Article in ordinary building materials incorporated into an improvement on land.
(b) Security interest in fixtures under real-property law. This Article does not prevent creation of an encumbrance upon fixtures under real property law.
(c) General rule: subordination of security interest in fixtures. In cases not governed by subsections (d) through (h), a security interest in fixtures is subordinate to a conflicting interest of an encumbrancer or owner of the related real property other than the debtor.
(d) Fixtures purchase-money priority. Except as otherwise provided in subsection (h), a perfected security interest in fixtures has priority over a conflicting interest of an encumbrancer or owner of the real property if the debtor has an interest of record in or is in possession of the real property and:
(e) Priority of security interest in fixtures over interests in real property. A perfected security interest in fixtures has priority over a conflicting interest of an encumbrancer or owner of the real property if:
(f) Priority based on consent, disclaimer, or right to remove. A security interest in fixtures, whether or not perfected, has priority over a conflicting interest of an encumbrancer or owner of the real property if:
(g) Continuation of subsection (f)(2) priority. The priority of the security interest under subsection (f)(2) continues for a reasonable time if the debtor's right to remove the goods as against the encumbrancer or owner terminates.
(h) Priority of construction mortgage. A mortgage is a construction mortgage to the extent that it secures an obligation incurred for the construction of an improvement on land, including the acquisition cost of the land, if a recorded record of the mortgage so indicates. Except as otherwise provided in subsections (e) and (f), a security interest in fixtures is subordinate to a construction mortgage if a record of the mortgage is recorded before the goods become fixtures and the goods become fixtures before the completion of the construction. A mortgage has this priority to the same extent as a construction mortgage to the extent that it is given to refinance a construction mortgage.
(i) Priority of security interest in crops.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-335)
Sec. 9-335. Accessions.
(a) Creation of security interest in accession. A security interest may be created in an accession and continues in collateral that becomes an accession.
(b) Perfection of security interest. If a security interest is perfected when the collateral becomes an accession, the security interest remains perfected in the collateral.
(c) Priority of security interest. Except as otherwise provided in subsection (d), the other provisions of this Part determine the priority of a security interest in an accession.
(d) Compliance with certificate-of-title statute. A security interest in an accession is subordinate to a security interest in the whole which is perfected by compliance with the requirements of a certificate-of-title statute under Section 9-311(b).
(e) Removal of accession after default. After default, subject to Part 6, a secured party may remove an accession from other goods if the security interest in the accession has priority over the claims of every person having an interest in the whole.
(f) Reimbursement following removal. A secured party that removes an accession from other goods under subsection (e) shall promptly reimburse any holder of a security interest or other lien on, or owner of, the whole or of the other goods, other than the debtor, for the cost of repair of any physical injury to the whole or the other goods. The secured party need not reimburse the holder or owner for any diminution in value of the whole or the other goods caused by the absence of the accession removed or by any necessity for replacing it. A person entitled to reimbursement may refuse permission to remove until the secured party gives adequate assurance for the performance of the obligation to reimburse.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-336)
Sec. 9-336. Commingled goods.
(a) "Commingled goods." In this Section, "commingled goods" means goods that are physically united with other goods in such a manner that their identity is lost in a product or mass.
(b) No security interest in commingled goods as such. A security interest does not exist in commingled goods as such. However, a security interest may attach to a product or mass that results when goods become commingled goods.
(c) Attachment of security interest to product or mass. If collateral becomes commingled goods, a security interest attaches to the product or mass.
(d) Perfection of security interest. If a security interest in collateral is perfected before the collateral becomes commingled goods, the security interest that attaches to the product or mass under subsection (c) is perfected.
(e) Priority of security interest. Except as otherwise provided in subsection (f), the other provisions of this Part determine the priority of a security interest that attaches to the product or mass under subsection (c).
(f) Conflicting security interests in product or mass If more than one security interest attaches to the product or mass under subsection (c), the following rules determine priority:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-337)
Sec. 9-337. Priority of security interests in goods covered by certificate of title. If, while a security interest in goods is perfected by any method under the law of another jurisdiction, this State issues a certificate of title that does not show that the goods are subject to the security interest or contain a statement that they may be subject to security interests not shown on the certificate:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-338)
Sec. 9-338. Priority of security interest or agricultural lien perfected by filed financing statement providing certain incorrect information. If a security interest or agricultural lien is perfected by a filed financing statement providing information described in Section 9-516(b)(5) which is incorrect at the time the financing statement is filed:
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-339)
Sec. 9-339. Priority subject to subordination. This Article does not preclude subordination by agreement by a person entitled to priority.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 3 Sub. 4 heading)
(810 ILCS 5/9-340)
Sec. 9-340. Effectiveness of right of recoupment or set-off against deposit account.
(a) Exercise of recoupment or set-off. Except as otherwise provided in subsection (c), a bank with which a deposit account is maintained may exercise any right of recoupment or set-off against a secured party that holds a security interest in the deposit account.
(b) Recoupment or set-off not affected by security interest. Except as otherwise provided in subsection (c), the application of this Article to a security interest in a deposit account does not affect a right of recoupment or set-off of the secured party as to a deposit account maintained with the secured party.
(c) When set-off ineffective. The exercise by a bank of a set-off against a deposit account is ineffective against a secured party that holds a security interest in the deposit account which is perfected by control under Section 9-104(a)(3), if the set-off is based on a claim against the debtor.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-341)
Sec. 9-341. Bank's rights and duties with respect to deposit account. Except as otherwise provided in Section 9-340(c), and unless the bank otherwise agrees in an authenticated record, a bank's rights and duties with respect to a deposit account maintained with the bank are not terminated, suspended, or modified by:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-342)
Sec. 9-342. Bank's right to refuse to enter into or disclose existence of control agreement. This Article does not require a bank to enter into an agreement of the kind described in Section 9-104(a)(2), even if its customer so requests or directs. A bank that has entered into such an agreement is not required to confirm the existence of the agreement to another person unless requested to do so by its customer.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 4 heading)
(810 ILCS 5/9-401) (from Ch. 26, par. 9-401)
Sec. 9-401. Alienability of debtor's rights.
(a) Other law governs alienability; exceptions. Except as otherwise provided in subsection (b) and Sections 9-406, 9-407, 9-408, and 9-409, whether a debtor's rights in collateral may be voluntarily or involuntarily transferred is governed by law other than this Article.
(b) Agreement does not prevent transfer. An agreement between the debtor and secured party which prohibits a transfer of the debtor's rights in collateral or makes the transfer a default does not prevent the transfer from taking effect.
(Source: P.A. 90-300, eff. 1-1-98; 91-893, eff. 7-1-01.)
(810 ILCS 5/9-401A)
Sec. 9-401A. (Blank).
(Source: P.A. 90-300, eff. 1-1-98; 91-893, eff. 7-1-01.)
(810 ILCS 5/9-402) (from Ch. 26, par. 9-402)
Sec. 9-402. Secured party not obligated on contract of debtor or in tort. The existence of a security interest, agricultural lien, or authority given to a debtor to dispose of or use collateral, without more, does not subject a secured party to liability in contract or tort for the debtor's acts or omissions.
(Source: P.A. 91-357, eff. 7-29-99; 91-893, eff. 7-1-01.)
(810 ILCS 5/9-403) (from Ch. 26, par. 9-403)
Sec. 9-403. Agreement not to assert defenses against assignee.
(a) "Value." In this Section, "value" has the meaning provided in Section 3-303(a).
(b) Agreement not to assert claim or defense. Except as otherwise provided in this Section, an agreement between an account debtor and an assignor not to assert against an assignee any claim or defense that the account debtor may have against the assignor is enforceable by an assignee that takes an assignment:
(c) When subsection (b) not applicable. Subsection (b) does not apply to defenses of a type that may be asserted against a holder in due course of a negotiable instrument under Section 3-305(b).
(d) Omission of required statement in consumer transaction. In a consumer transaction, if a record evidences the account debtor's obligation, law other than this Article requires that the record include a statement to the effect that the rights of an assignee are subject to claims or defenses that the account debtor could assert against the original obligee, and the record does not include such a statement:
(e) Rule for individual under other law. This Section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.
(f) Other law not displaced. Except as otherwise provided in subsection (d), this Section does not displace law other than this Article which gives effect to an agreement by an account debtor not to assert a claim or defense against an assignee.
(Source: P.A. 90-300, eff. 1-1-98; 91-357, eff. 7-29-99; 91-893, eff. 7-1-01.)
(810 ILCS 5/9-404) (from Ch. 26, par. 9-404)
Sec. 9-404. Rights acquired by assignee; claims and defenses against assignee.
(a) Assignee's rights subject to terms, claims, and defenses; exceptions. Unless an account debtor has made an enforceable agreement not to assert defenses or claims, and subject to subsections (b) through (e), the rights of an assignee are subject to:
(b) Account debtor's claim reduces amount owed to assignee. Subject to subsection (c) and except as otherwise provided in subsection (d), the claim of an account debtor against an assignor may be asserted against an assignee under subsection (a) only to reduce the amount the account debtor owes.
(c) Rule for individual under other law. This Section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.
(d) Omission of required statement in consumer transaction. In a consumer transaction, if a record evidences the account debtor's obligation, law other than this Article requires that the record include a statement to the effect that the account debtor's recovery against an assignee with respect to claims and defenses against the assignor may not exceed amounts paid by the account debtor under the record, and the record does not include such a statement, the extent to which a claim of an account debtor against the assignor may be asserted against an assignee is determined as if the record included such a statement.
(e) Inapplicability to health-care-insurance receivable. This Section does not apply to an assignment of a health-care-insurance receivable.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-404.5)
Sec. 9-404.5. Termination statement; duties of filing officer.
(1) If a financing statement covering consumer goods is filed on or after July 1, 1973, then within one month or within 10 days following written demand by the debtor after there is no outstanding secured obligation and no commitment to make advances, incur obligations or otherwise give value, the secured party must file with each filing officer with whom the financing statement was filed, a termination statement to the effect that he no longer claims a security interest under the financing statement, which shall be identified by file number. In other cases whenever there is no outstanding secured obligation and no commitment to make advances, incur obligations or otherwise give value, the secured party must on written demand by the debtor send the debtor, for each filing officer with whom the financing statement was filed, a termination statement to the effect that he no longer claims a security interest under the financing statement, which shall be identified by file number. A termination statement signed by a person other than the secured party of record must be accompanied by a separate written statement of assignment signed by the secured party of record. If the affected secured party fails to file such a termination statement as required by this subsection, or to send such a termination statement within 10 days after proper demand therefor, he shall be liable to the debtor for $100 and in addition for any loss caused to the debtor by such failure.
(2) On presentation to the filing officer of such a termination statement he must note it in the index. If he has received the termination statement in duplicate, he shall return one copy of the termination statement to the secured party stamped to show the time of receipt thereof. If the filing officer has a microfilm or other photographic record of the financing statement, and of any related continuation statement, statement of assignment and statement of release, he may remove the originals from the files at any time after receipt of the termination statement, or if he has no such record, he may remove them from the files at any time after one year after receipt of the termination statement.
(3) If the termination statement is in the standard form prescribed by the Secretary of State, the uniform fee for filing and indexing the termination statement in the office of a county recorder shall be $5 and otherwise shall be $10, plus in each case an additional fee of $5 for each name more than one at each address listed against which the termination statement is required to be indexed.
(Source: P.A. 91-893, eff. 7-6-00.)
(810 ILCS 5/9-405) (from Ch. 26, par. 9-405)
Sec. 9-405. Modification of assigned contract.
(a) Effect of modification on assignee. A modification of or substitution for an assigned contract is effective against an assignee if made in good faith. The assignee acquires corresponding rights under the modified or substituted contract. The assignment may provide that the modification or substitution is a breach of contract by the assignor. This subsection is subject to subsections (b) through (d).
(b) Applicability of subsection (a). Subsection (a) applies to the extent that:
(c) Rule for individual under other law. This Section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.
(d) Inapplicability to health-care-insurance receivable. This Section does not apply to an assignment of a health-care-insurance receivable.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-406) (from Ch. 26, par. 9-406)
Sec. 9-406. Discharge of account debtor; notification of assignment; identification and proof of assignment; restrictions on assignment of accounts, chattel paper, payment intangibles, and promissory notes ineffective.
(a) Discharge of account debtor; effect of notification. Subject to subsections (b) through (i), an account debtor on an account, chattel paper, or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, authenticated by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.
(b) When notification ineffective. Subject to subsection (h), notification is ineffective under subsection (a):
(c) Proof of assignment. Subject to subsection (h), if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under subsection (a).
(d) Term restricting assignment generally ineffective. Except as otherwise provided in subsection (e) and Sections 2A-303 and 9-407, and subject to subsection (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it:
(e) Inapplicability of subsection (d) to certain sales. Subsection (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9-610 or an acceptance of collateral under Section 9-620.
(f) Legal restrictions on assignment generally ineffective. Except as otherwise provided in Sections 2A-303 and 9-407 and subject to subsections (h) and (i), a rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation:
(g) Subsection (b)(3) not waivable. Subject to subsection (h), an account debtor may not waive or vary its option under subsection (b)(3).
(h) Rule for individual under other law. This Section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.
(i) Inapplicability to health-care-insurance receivable. This Section does not apply to an assignment of a health-care-insurance receivable.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-407) (from Ch. 26, par. 9-407)
Sec. 9-407. Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest.
(a) Term restricting assignment generally ineffective. Except as otherwise provided in subsection (b), a term in a lease agreement is ineffective to the extent that it:
(b) Effectiveness of certain terms. Except as otherwise provided in Section 2A-303(7), a term described in subsection (a)(2) is effective to the extent that there is:
(c) Security interest not material impairment. The creation, attachment, perfection, or enforcement of a security interest in the lessor's interest under the lease contract or the lessor's residual interest in the goods is not a transfer that materially impairs the lessee's prospect of obtaining return performance or materially changes the duty of or materially increases the burden or risk imposed on the lessee within the purview of Section 2A-303(4) unless, and then only to the extent that, enforcement actually results in a delegation of material performance of the lessor.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-408) (from Ch. 26, par. 9-408)
Sec. 9-408. Restrictions on assignment of promissory notes, health-care-insurance receivables, and certain general intangibles ineffective.
(a) Term restricting assignment generally ineffective. Except as otherwise provided in subsection (b), a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible, is ineffective to the extent that the term:
(b) Applicability of subsection (a) to sales of certain rights to payment. Subsection (a) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9-610 or an acceptance of collateral under Section 9-620.
(c) Legal restrictions on assignment generally ineffective. A rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, person obligated on a promissory note, or account debtor to the assignment or transfer of, or creation of a security interest in, a promissory note, health-care-insurance receivable, or general intangible, including a contract, permit, license, or franchise between an account debtor and a debtor, is ineffective to the extent that the rule of law, statute, or regulation:
(d) Limitation on ineffectiveness under subsections (a) and (c). To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or general intangible or a rule of law, statute, or regulation described in subsection (c) would be effective under law other than this Article but is ineffective under subsection (a) or (c), the creation, attachment, or perfection of a security interest in the promissory note, health-care-insurance receivable, or general intangible:
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-409)
Sec. 9-409. Restrictions on assignment of letter-of-credit rights ineffective.
(a) Term or law restricting assignment generally ineffective. A term in a letter of credit or a rule of law, statute, regulation, custom, or practice applicable to the letter of credit which prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary's assignment of or creation of a security interest in a letter-of-credit right is ineffective to the extent that the term or rule of law, statute, regulation, custom, or practice:
(b) Limitation on ineffectiveness under subsection (a). To the extent that a term in a letter of credit is ineffective under subsection (a) but would be effective under law other than this Article or a custom or practice applicable to the letter of credit, to the transfer of a right to draw or otherwise demand performance under the letter of credit, or to the assignment of a right to proceeds of the letter of credit, the creation, attachment, or perfection of a security interest in the letter-of-credit right:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-410)
Sec. 9-410. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 5 heading)
(810 ILCS 5/Art. 9 Pt. 5 Sub. 1 heading)
(810 ILCS 5/9-501) (from Ch. 26, par. 9-501)
Sec. 9-501. Filing office.
(a) Filing offices. Except as otherwise provided in subsection (b), if the local law of this State governs perfection of a security interest or agricultural lien, the office in which to file a financing statement to perfect the security interest or agricultural lien is:
(b) Filing office for transmitting utilities. The office in which to file a financing statement to perfect a security interest in collateral, including fixtures, of a transmitting utility is the office of the Secretary of State. The financing statement also constitutes a fixture filing as to the collateral indicated in the financing statement which is or is to become fixtures.
(Source: P.A. 91-357, eff. 7-29-99; 91-893, eff. 7-1-01.)
(810 ILCS 5/9-501.1)
Sec. 9-501.1. Fraudulent records.
(a) No person shall cause to be communicated to the filing office for filing a false record the person knows or reasonably should know:
(b) A person who violates subsection (a) is guilty of a Class A misdemeanor for a first offense and a Class 4 felony for a second or subsequent offense.
(c) A person who violates subsection (a) shall be liable in a civil action to each injured person for:
(d) A person identified as debtor in a filed record the person believes was caused to be communicated to the filing office in violation of subsection (a) may, under penalty of perjury, file with the Secretary of State an affidavit to that effect. The Secretary of State shall adopt and make available a form affidavit for use under this Section.
(e) Upon receipt of an affidavit filed under this Section, or upon administrative action by the Secretary of State, the Secretary of State shall communicate to the secured party of record on the record to which the affidavit or administrative action relates and to the person that communicated the record to the filing office, if different and known to the office, a request for additional documentation supporting the effectiveness of the record. The Department of Business Services of the Office of the Secretary of State and the Office of the General Counsel shall review all such documentation received within 30 days after the first request for additional documentation is sent. The Secretary of State may terminate the record effective 30 days after the first request for additional documentation is sent if it has a reasonable basis for concluding that the record was communicated to the filing office in violation of subsection (a).
The Secretary of State may initiate an administrative action under the first paragraph of this subsection (e) with regard to a filed record if it has reason to believe, from information contained in the record or obtained from the person that communicated the record to the filing office, that the record was communicated to the filing office in violation of subsection (a). The Secretary of State may give heightened scrutiny to a record that indicates that the debtor is a transmitting utility or that indicates that the transaction to which the record relates is a manufactured-home transaction or a public-finance transaction.
(f) The Secretary of State shall not charge a fee to file an affidavit under this Section and shall not return any fee paid for filing a record terminated under this Section.
(g) The Secretary of State shall promptly communicate to the secured party of record a notice of the termination of a record under subsection (e). A secured party of record that believes in good faith that the record was not communicated to the filing office in violation of subsection (a) may file an action to require that the record be reinstated by the filing office. A person that communicated a record to the filing office that the filing office rejected in reliance on Section 9-516(b)(3.5), who believes in good faith that the record was not communicated to the filing office in violation of Section 9-516(b)(3.5), may file an action to require that the record be accepted by the filing office.
(h) If a court or tribunal in an action under this Section determines that a record terminated under this Section or rejected in reliance on Section 9-516(b)(3.5) should be reinstated or accepted, the court or tribunal shall provide a copy of its order to that effect to the Secretary of State. On receipt of an order reinstating a terminated record, the Secretary of State shall refile the record along with a notice indicating that the record was refiled pursuant to this Section and its initial filing date. On receipt of an order requiring that a rejected record be accepted, the Secretary of State shall promptly file the record along with a notice indicating that the record was filed pursuant to this Section and the date on which it was communicated for filing. A rejected record that is filed pursuant to an order of a court or tribunal shall have the effect described in Section 9-516(d) for a record the filing office refuses to accept for a reason other than one set forth in Section 9-516(b).
(i) A terminated record that is refiled under subsection (h) is effective as a filed record from the initial filing date. If the period of effectiveness of a refiled record would have lapsed during the period of termination, the secured party may file a continuation statement within 30 days after the record is refiled and the continuation statement shall have the same effect as if it had been filed during the 6-month period described in Section 9-515(d). A refiled record shall be considered never to have been ineffective against all persons and for all purposes except that it shall not be effective as against a purchaser of the collateral that gave value in reasonable reliance on the absence of the record from the files.
(j) Neither the filing office nor any of its employees shall incur liability for the termination or failure to terminate a record under this Section or for the refusal to accept a record for filing in the lawful performance of the duties of the office or employee.
(k) This Section does not apply to a record communicated to the filing office by a regulated financial institution or by a representative of a regulated financial institution except that the Secretary of State may request from the secured party of record on the record or from the person that communicated the record to the filing office, if different and known to the office, additional documentation supporting that the record was communicated to the filing office by a regulated financial institution or by a representative of a regulated financial institution. The term "regulated financial institution" means a financial institution subject to regulatory oversight or examination by a State or federal agency and includes banks, savings banks, savings associations, building and loan associations, credit unions, consumer finance companies, industrial banks, industrial loan companies, insurance companies, investment companies, investment funds, installment sellers, mortgage servicers, sales finance companies, and leasing companies.
(l) If a record was communicated to the filing office for filing before the effective date of this Section and its communication would have constituted a violation of subsection (a) if it had occurred on or after the effective date of the Section: (i) subsections (b) and (c) are not applicable; and (ii) the other subsections of this Section are applicable.
(Source: P.A. 97-836, eff. 7-20-12.)
(810 ILCS 5/9-502) (from Ch. 26, par. 9-502)
Sec. 9-502. Contents of financing statement; record of mortgage as financing statement; time of filing financing statement.
(a) Sufficiency of financing statement. Subject to subsection (b), a financing statement is sufficient only if it:
(b) Real-property-related financing statements. Except as otherwise provided in Section 9-501(b), to be sufficient, a financing statement that covers as-extracted collateral or timber to be cut, or which is filed as a fixture filing and covers goods that are or are to become fixtures, must satisfy subsection (a) and also:
(c) Record of mortgage as financing statement. A record of a mortgage is effective, from the date of recording, as a financing statement filed as a fixture filing or as a financing statement covering as-extracted collateral or timber to be cut only if:
(d) Filing before security agreement or attachment. A financing statement may be filed before a security agreement is made or a security interest otherwise attaches.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-503) (from Ch. 26, par. 9-503)
Sec. 9-503. Name of debtor and secured party.
(a) Sufficiency of debtor's name. A financing statement sufficiently provides the name of the debtor:
(b) Additional debtor-related information. A financing statement that provides the name of the debtor in accordance with subsection (a) is not rendered ineffective by the absence of:
(c) Debtor's trade name insufficient. A financing statement that provides only the debtor's trade name does not sufficiently provide the name of the debtor.
(d) Representative capacity. Failure to indicate the representative capacity of a secured party or representative of a secured party does not affect the sufficiency of a financing statement.
(e) Multiple debtors and secured parties. A financing statement may provide the name of more than one debtor and the name of more than one secured party.
(f) Name of decedent. The name of the decedent indicated on the order appointing the personal representative of the decedent issued by the court having jurisdiction over the collateral is sufficient as the "name of the decedent" under subsection (a)(2).
(g) Multiple driver's licenses. If this State has issued to an individual more than one driver's license of a kind described in subsection (a)(4), the one that was issued most recently is the one to which subsection (a)(4) refers.
(h) Definition. In this Section, the "name of the settlor or testator" means:
(810 ILCS 5/9-504) (from Ch. 26, par. 9-504)
Sec. 9-504. Indication of collateral. A financing statement sufficiently indicates the collateral that it covers if the financing statement provides:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-505) (from Ch. 26, par. 9-505)
Sec. 9-505. Filing and compliance with other statutes and treaties for consignments, leases, other bailments, and other transactions.
(a) Use of terms other than "debtor" and "secured party." A consignor, lessor, or other bailor of goods, a licensor, or a buyer of a payment intangible or promissory note may file a financing statement, or may comply with a statute or treaty described in Section 9-311(a), using the terms "consignor", "consignee", "lessor", "lessee", "bailor", "bailee", "licensor", "licensee", "owner", "registered owner", "buyer", "seller", or words of similar import, instead of the terms "secured party" and "debtor".
(b) Effect of financing statement under subsection (a). This part applies to the filing of a financing statement under subsection (a) and, as appropriate, to compliance that is equivalent to filing a financing statement under Section 9-311(b), but the filing or compliance is not of itself a factor in determining whether the collateral secures an obligation. If it is determined for another reason that the collateral secures an obligation, a security interest held by the consignor, lessor, bailor, licensor, owner, or buyer which attaches to the collateral is perfected by the filing or compliance.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-506) (from Ch. 26, par. 9-506)
Sec. 9-506. Effect of errors or omissions.
(a) Minor errors and omissions. A financing statement substantially satisfying the requirements of this Part is effective, even if it has minor errors or omissions, unless the errors or omissions make the financing statement seriously misleading.
(b) Financing statement seriously misleading. Except as otherwise provided in subsection (c), a financing statement that fails sufficiently to provide the name of the debtor in accordance with Section 9-503(a) is seriously misleading.
(c) Financing statement not seriously misleading. If a search of the records of the filing office under the debtor's correct name, using the filing office's standard search logic, if any, would disclose a financing statement that fails sufficiently to provide the name of the debtor in accordance with Section 9-503(a), the name provided does not make the financing statement seriously misleading.
(d) "Debtor's correct name." For purposes of Section 9-508(b), the "debtor's correct name" in subsection (c) means the correct name of the new debtor.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-507) (from Ch. 26, par. 9-507)
Sec. 9-507. Effect of certain events on effectiveness of financing statement.
(a) Disposition. A filed financing statement remains effective with respect to collateral that is sold, exchanged, leased, licensed, or otherwise disposed of and in which a security interest or agricultural lien continues, even if the secured party knows of or consents to the disposition.
(b) Information becoming seriously misleading. Except as otherwise provided in subsection (c) and Section 9-508, a financing statement is not rendered ineffective if, after the financing statement is filed, the information provided in the financing statement becomes seriously misleading under Section 9-506.
(c) Change in debtor's name. If the name that a filed financing statement provides for a debtor becomes insufficient as the name of the debtor under Section 9-503(a) so that the financing statement becomes seriously misleading under Section 9-506:
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-508)
Sec. 9-508. Effectiveness of financing statement if new debtor becomes bound by security agreement.
(a) Financing statement naming original debtor. Except as otherwise provided in this Section, a filed financing statement naming an original debtor is effective to perfect a security interest in collateral in which a new debtor has or acquires rights to the extent that the financing statement would have been effective had the original debtor acquired rights in the collateral.
(b) Financing statement becoming seriously misleading. If the difference between the name of the original debtor and that of the new debtor causes a filed financing statement that is effective under subsection (a) to be seriously misleading under Section 9-506:
(c) When Section not applicable. This Section does not apply to collateral as to which a filed financing statement remains effective against the new debtor under Section 9-507(a).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-509)
Sec. 9-509. Persons entitled to file a record.
(a) Person entitled to file record. A person may file an initial financing statement, amendment that adds collateral covered by a financing statement, or amendment that adds a debtor to a financing statement only if:
(b) Security agreement as authorization. By authenticating or becoming bound as debtor by a security agreement, a debtor or new debtor authorizes the filing of an initial financing statement, and an amendment, covering:
(c) Acquisition of collateral as authorization. By acquiring collateral in which a security interest or agricultural lien continues under Section 9-315(a)(1), a debtor authorizes the filing of an initial financing statement, and an amendment, covering the collateral and property that becomes collateral under Section 9-315(a)(2).
(d) Person entitled to file certain amendments. A person may file an amendment other than an amendment that adds collateral covered by a financing statement or an amendment that adds a debtor to a financing statement only if:
(e) Multiple secured parties of record. If there is more than one secured party of record for a financing statement, each secured party of record may authorize the filing of an amendment under subsection (d).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-510)
Sec. 9-510. Effectiveness of filed record.
(a) Filed record effective if authorized. A filed record is effective only to the extent that it was filed by a person that may file it under Section 9-509.
(b) Authorization by one secured party of record. A record authorized by one secured party of record does not affect the financing statement with respect to another secured party of record.
(c) Continuation statement not timely filed. A continuation statement that is not filed within the six-month period prescribed by Section 9-515(d) is ineffective.
(d) A filed record ceases to be effective if the filing office terminates the record pursuant to Section 9-501.1.
(Source: P.A. 97-836, eff. 7-20-12.)
(810 ILCS 5/9-511)
Sec. 9-511. Secured party of record.
(a) Secured party of record. A secured party of record with respect to a financing statement is a person whose name is provided as the name of the secured party or a representative of the secured party in an initial financing statement that has been filed. If an initial financing statement is filed under Section 9-514(a), the assignee named in the initial financing statement is the secured party of record with respect to the financing statement.
(b) Amendment naming secured party of record. If an amendment of a financing statement which provides the name of a person as a secured party or a representative of a secured party is filed, the person named in the amendment is a secured party of record. If an amendment is filed under Section 9-514(b), the assignee named in the amendment is a secured party of record.
(c) Amendment deleting secured party of record. A person remains a secured party of record until the filing of an amendment of the financing statement which deletes the person.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-512)
Sec. 9-512. Amendment of financing statement.
(a) Amendment of information in financing statement. Subject to Section 9-509, a person may add or delete collateral covered by, continue or terminate the effectiveness of, or, subject to subsection (e), otherwise amend the information provided in, a financing statement by filing an amendment that:
(b) Period of effectiveness not affected. Except as otherwise provided in Section 9-515, the filing of an amendment does not extend the period of effectiveness of the financing statement.
(c) Effectiveness of amendment adding collateral. A financing statement that is amended by an amendment that adds collateral is effective as to the added collateral only from the date of the filing of the amendment.
(d) Effectiveness of amendment adding debtor. A financing statement that is amended by an amendment that adds a debtor is effective as to the added debtor only from the date of the filing of the amendment.
(e) Certain amendments ineffective. An amendment is ineffective to the extent it:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-513)
Sec. 9-513. Termination statement.
(a) Consumer goods. A secured party shall cause the secured party of record for a financing statement to file a termination statement for the financing statement if the financing statement covers consumer goods and:
(b) Time for compliance with subsection (a). To comply with subsection (a), a secured party shall cause the secured party of record to file the termination statement:
(c) Other collateral. In cases not governed by subsection (a), within 20 days after a secured party receives an authenticated demand from a debtor, the secured party shall cause the secured party of record for a financing statement to send to the debtor a termination statement for the financing statement or file the termination statement in the filing office if:
(d) Effect of filing termination statement. Except as otherwise provided in Section 9-510, upon the filing of a termination statement with the filing office, the financing statement to which the termination statement relates ceases to be effective. Except as otherwise provided in Section 9-510, for purposes of Sections 9-519(g), 9-522(a), and 9-523(c) the filing with the filing office of a termination statement relating to a financing statement that indicates that the debtor is a transmitting utility also causes the effectiveness of the financing statement to lapse.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-514)
Sec. 9-514. Assignment of powers of secured party of record.
(a) Assignment reflected on initial financing statement. Except as otherwise provided in subsection (c), an initial financing statement may reflect an assignment of all of the secured party's power to authorize an amendment to the financing statement by providing the name and mailing address of the assignee as the name and address of the secured party.
(b) Assignment of filed financing statement. Except as otherwise provided in subsection (c), a secured party of record may assign of record all or part of its power to authorize an amendment to a financing statement by filing in the filing office an amendment of the financing statement which:
(c) Assignment of record of mortgage. An assignment of record of a security interest in a fixture covered by a record of a mortgage which is effective as a financing statement filed as a fixture filing under Section 9-502(c) may be made only by an assignment of record of the mortgage in the manner provided by law of this State other than the Uniform Commercial Code.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-515)
Sec. 9-515. Duration and effectiveness of financing statement; effect of lapsed financing statement.
(a) Five-year effectiveness. Except as otherwise provided in subsections (b), (e), (f), and (g), a filed financing statement is effective for a period of five years after the date of filing.
(b) Public-finance or manufactured-home transaction. Except as otherwise provided in subsections (e), (f), and (g), an initial financing statement filed in connection with a public-finance transaction or manufactured-home transaction is effective for a period of 30 years after the date of filing if it indicates that it is filed in connection with a public-finance transaction or manufactured-home transaction.
(c) Lapse and continuation of financing statement. The effectiveness of a filed financing statement lapses on the expiration of the period of its effectiveness unless before the lapse a continuation statement is filed pursuant to subsection (d). Upon lapse, a financing statement ceases to be effective and any security interest or agricultural lien that was perfected by the financing statement becomes unperfected, unless the security interest is perfected otherwise. If the security interest or agricultural lien becomes unperfected upon lapse, it is deemed never to have been perfected as against a purchaser of the collateral for value.
(d) When continuation statement may be filed. A continuation statement may be filed only within six months before the expiration of the five-year period specified in subsection (a) or the 30-year period specified in subsection (b), whichever is applicable.
(e) Effect of filing continuation statement. Except as otherwise provided in Section 9-510, upon timely filing of a continuation statement, the effectiveness of the initial financing statement continues for a period of five years commencing on the day on which the financing statement would have become ineffective in the absence of the filing. Upon the expiration of the five-year period, the financing statement lapses in the same manner as provided in subsection (c), unless, before the lapse, another continuation statement is filed pursuant to subsection (d). Succeeding continuation statements may be filed in the same manner to continue the effectiveness of the initial financing statement.
(f) Transmitting utility financing statement. If a debtor is a transmitting utility and a filed initial financing statement so indicates, the financing statement is effective until a termination statement is filed.
(g) Record of mortgage as financing statement. A record of a mortgage that is effective as a financing statement filed as a fixture filing under Section 9-502(c) remains effective as a financing statement filed as a fixture filing until the mortgage is released or satisfied of record or its effectiveness otherwise terminates as to the real property.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-516)
Sec. 9-516. What constitutes filing; effectiveness of filing.
(a) What constitutes filing. Except as otherwise provided in subsection (b), communication of a record to a filing office and tender of the filing fee or acceptance of the record by the filing office constitutes filing.
(b) Refusal to accept record; filing does not occur. Filing does not occur with respect to a record that a filing office refuses to accept because:
(c) Rules applicable to subsection (b). For purposes of subsection (b):
(d) Refusal to accept record; record effective as filed record. A record that is communicated to the filing office with tender of the filing fee, but which the filing office refuses to accept for a reason other than one set forth in subsection (b), is effective as a filed record except as against a purchaser of the collateral which gives value in reasonable reliance upon the absence of the record from the files.
(e) The Secretary of State may refuse to accept a record for filing under subdivision (b)(3)(E) or (b)(3.5) only if the refusal is approved by the Department of Business Services of the Secretary of State and the General Counsel to the Secretary of State.
(Source: P.A. 97-836, eff. 7-20-12; 97-1034, eff. 7-1-13; 98-463, eff. 8-16-13.)
(810 ILCS 5/9-517)
Sec. 9-517. Effect of indexing errors. The failure of the filing office to index a record correctly does not affect the effectiveness of the filed record.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-518)
Sec. 9-518. Claim concerning inaccurate or wrongfully filed record.
(a) Statement with respect to record indexed under a person's name. A person may file in the filing office an information statement with respect to a record indexed there under the person's name if the person believes that the record is inaccurate or was wrongfully filed.
(b) Contents of statement under subsection (a). An information statement under subsection (a) must:
(c) Statement by secured party of record. A person may file in the filing office an information statement with respect to a record filed there if the person is a secured party of record with respect to the financing statement to which the record relates and believes that the person that filed the record was not entitled to do so under Section 9-509(d).
(d) Contents of statement under subsection (c). An information statement under subsection (c) must:
(e) Record not affected by information statement. The filing of an information statement does not affect the effectiveness of an initial financing statement or other filed record.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/Art. 9 Pt. 5 Sub. 2 heading)
(810 ILCS 5/9-519)
Sec. 9-519. Numbering, maintaining, and indexing records; communicating information provided in records.
(a) Filing office duties. For each record filed in a filing office, the filing office shall:
(b) File number. A file number assigned after January 1, 2002, must include a digit that:
(c) Indexing: general. Except as otherwise provided in subsections (d) and (e), the filing office shall:
(d) Indexing: real-property-related financing statement. If a financing statement is filed as a fixture filing or covers as-extracted collateral or timber to be cut, it must be filed for record and the filing office shall index it:
(e) Indexing: real-property-related assignment. If a financing statement is filed as a fixture filing or covers as-extracted collateral or timber to be cut, the filing office shall index an assignment filed under Section 9-514(a) or an amendment filed under Section 9-514(b):
(f) Retrieval and association capability. The filing office shall maintain a capability:
(g) Removal of debtor's name. The filing office may not remove a debtor's name from the index until one year after the effectiveness of a financing statement naming the debtor lapses under Section 9-515 with respect to all secured parties of record.
(h) Timeliness of filing office performance. The filing office shall perform the acts required by subsections (a) through (e) at the time and in the manner prescribed by filing-office rule, but not later than two business days after the filing office receives the record in question.
(i) Inapplicability to real-property-related filing office. Subsections (b) and (h) do not apply to a filing office described in Section 9-501(a)(1).
(j) Unless a statute on disposition of public records provides otherwise, if the filing officer has an electronic, microfilm, or other image record to be maintained of the financing statement, continuation statement, statement of assignment, statement of release, termination statement, or any other related document, he or she may remove and destroy the original paper submission.
(Source: P.A. 91-893, eff. 7-1-01; 92-33, eff. 7-1-01.)
(810 ILCS 5/9-520)
Sec. 9-520. Acceptance and refusal to accept record.
(a) Mandatory refusal to accept record. A filing office shall refuse to accept a record for filing for a reason set forth in Section 9-516(b) and may refuse to accept a record for filing only for a reason set forth in Section 9-516(b).
(b) Communication concerning refusal. If a filing office refuses to accept a record for filing, it shall communicate to the person that presented the record the fact of and reason for the refusal and the date and time the record would have been filed had the filing office accepted it. The communication must be made at the time and in the manner prescribed by filing-office rule, but in the case of a filing office described in Section 9-501(a)(2), in no event more than two business days after the filing office receives the record.
(c) When filed financing statement effective. A filed financing statement satisfying Section 9-502(a) and (b) is effective, even if the filing office is required to refuse to accept it for filing under subsection (a). However, Section 9-338 applies to a filed financing statement providing information described in Section 9-516(b)(5) which is incorrect at the time the financing statement is filed.
(d) Separate application to multiple debtors. If a record communicated to a filing office provides information that relates to more than one debtor, this Part applies as to each debtor separately.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-521)
Sec. 9-521. Uniform form of written financing statement and amendment.
(a) Initial financing statement form. A filing office that accepts written records may not refuse to accept a written initial financing statement in the form and format set forth in the official text of the 2010 amendments to Article 9 of the Uniform Commercial Code promulgated by the American Law Institute and the National Conference of Commissioners on Uniform State Laws, except for a reason set forth in Section 9-516(b).
(b) Amendment form. A filing office that accepts written records may not refuse to accept a written record in the form and format set forth as Form UCC3 and Form UCC3Ad in the final official text of the 2010 amendments to Article 9 of the Uniform Commercial Code promulgated by the American Law Institute and the National Conference of Commissioners on Uniform State Laws, except for a reason set forth in Section 9-516(b).
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-522)
Sec. 9-522. Maintenance and destruction of records.
(a) Post-lapse maintenance and retrieval of information. The filing office shall maintain a record of the information provided in a filed financing statement for at least one year after the effectiveness of the financing statement has lapsed under Section 9-515 with respect to all secured parties of record. The record must be retrievable by using the name of the debtor and:
(b) Destruction of written records. Except to the extent that a statute governing disposition of public records provides otherwise, the filing office immediately may destroy any written record evidencing a financing statement. However, if the filing office destroys a written record, it shall maintain another record of the financing statement which complies with subsection (a).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-523)
Sec. 9-523. Information from filing office; sale or license of records.
(a) Acknowledgment of filing written record. If a person that files a written record requests an acknowledgment of the filing, the filing office shall send to the person an image of the record showing the number assigned to the record pursuant to Section 9-519(a)(1) and the date and time of the filing of the record. However, if the person furnishes a copy of the record to the filing office, the filing office may instead:
(b) Acknowledgment of filing other record. If a person files a record other than a written record, the filing office shall communicate to the person an acknowledgment that provides:
(c) Communication of requested information. The filing office shall communicate or otherwise make available in a record the following information to any person that requests it:
(d) Medium for communicating information. In complying with its duty under subsection (c), the filing office may communicate information in any medium. However, if requested, the filing office shall communicate information by issuing a record that can be admitted into evidence in the courts of this State without extrinsic evidence of its authenticity.
(e) Timeliness of filing office performance. The filing office shall perform the acts required by subsections (a) through (d) at the time and in the manner prescribed by filing-office rule, but in the case of a filing office described in Section 9-501(a)(2), not later than two business days after the filing office receives the request.
(f) Public availability of records. At least weekly, the Secretary of State shall offer to sell or license to the public on a nonexclusive basis, in bulk, copies of all records filed in it under this Part, in every medium from time to time available to the filing office.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-524)
Sec. 9-524. Delay by filing office. Delay by the filing office beyond a time limit prescribed by this Part is excused if:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-525)
Sec. 9-525. Fees.
(a) Initial financing statement or other record: general rule. Except as otherwise provided in subsection (e), the fee for filing and indexing a record under this Part, other than an initial financing statement of the kind described in subsection (b), is:
(b) Initial financing statement: public-finance and manufactured-housing transactions. Except as otherwise provided in subsection (e), the fee for filing and indexing an initial financing statement of the following kind is:
(c) Number of names. The number of names required to be indexed does not affect the amount of the fee in subsections (a) and (b).
(d) Response to information request. The fee for responding to a request for information from the filing office, including for issuing a certificate showing communicating whether there is on file any financing statement naming a particular debtor, is:
(e) Record of mortgage. This Section does not require a fee with respect to a record of a mortgage which is effective as a financing statement filed as a fixture filing or as a financing statement covering as-extracted collateral or timber to be cut under Section 9-502(c). However, the recording and satisfaction fees that otherwise would be applicable to the record of the mortgage apply.
(f) Of the total money collected for each filing with the Secretary of State of an original financing statement, amended statement, continuation, or assignment, or for a release of collateral, $12 of the filing fee shall be paid into the Secretary of State Special Services Fund. The remaining $8 shall be deposited into the General Revenue Fund in the State treasury.
(Source: P.A. 93-990, eff. 8-23-04.)
(810 ILCS 5/9-526)
Sec. 9-526. Filing-office rules.
(a) Adoption of filing-office rules. The Secretary of State shall adopt and publish rules to implement this Article. The filing-office rules must be:
(b) Harmonization of rules. To keep the filing-office rules and practices of the filing office in harmony with the rules and practices of filing offices in other jurisdictions that enact substantially this Part, and to keep the technology used by the filing office compatible with the technology used by filing offices in other jurisdictions that enact substantially this Part, the Secretary of State, so far as is consistent with the purposes, policies, and provisions of this Article, in adopting, amending, and repealing filing-office rules, shall:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-527)
Sec. 9-527. Duty to report. The Secretary of State shall report annually to the Governor and Legislature on the operation of the filing office. The report must contain a statement of the extent to which:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-528)
Sec. 9-528. Liability of filing officer. Neither the filing officer nor any of the filing officer's employees or agents shall be subject to personal liability by reason of any error or omission in the performance of any duty under this Article except in the case of willful and wanton conduct.
(Source: P.A. 92-33, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 6 heading)
(810 ILCS 5/Art. 9 Pt. 6 Sub. 1 heading)
(810 ILCS 5/9-601)
Sec. 9-601. Rights after default; judicial enforcement; consignor or buyer of accounts, chattel paper, payment intangibles, or promissory notes.
(a) Rights of secured party after default. After default, a secured party has the rights provided in this Part and, except as otherwise provided in Section 9-602, those provided by agreement of the parties. A secured party:
(b) Rights and duties of secured party in possession or control. A secured party in possession of collateral or control of collateral under Section 7-106, 9-104, 9-105, 9-106, or 9-107 has the rights and duties provided in Section 9-207.
(c) Rights cumulative; simultaneous exercise. The rights under subsections (a) and (b) are cumulative and may be exercised simultaneously.
(d) Rights of debtor and obligor. Except as otherwise provided in subsection (g) and Section 9-605, after default, a debtor and an obligor have the rights provided in this Part and by agreement of the parties.
(e) Lien of levy after judgment. If a secured party has reduced its claim to judgment, the lien of any levy that may be made upon the collateral by virtue of a judgment relates back to the earliest of:
(f) Execution sale. A sale pursuant to a judgment is a foreclosure of the security interest or agricultural lien by judicial procedure within the meaning of this Section. A secured party may purchase at the sale and thereafter hold the collateral free of any other requirements of this Article.
(g) Consignor or buyer of certain rights to payment. Except as otherwise provided in Section 9-607(c), this Part imposes no duties upon a secured party that is a consignor or is a buyer of accounts, chattel paper, payment intangibles, or promissory notes.
(Source: P.A. 95-895, eff. 1-1-09.)
(810 ILCS 5/9-602)
Sec. 9-602. Waiver and variance of rights and duties. Except as otherwise provided in Section 9-624, to the extent that they give rights to a debtor or obligor and impose duties on a secured party, the debtor or obligor may not waive or vary the rules stated in the following listed Sections:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-603)
Sec. 9-603. Agreement on standards concerning rights and duties.
(a) Agreed standards. The parties may determine by agreement the standards measuring the fulfillment of the rights of a debtor or obligor and the duties of a secured party under a rule stated in Section 9-602 if the standards are not manifestly unreasonable.
(b) Agreed standards inapplicable to breach of peace. Subsection (a) does not apply to the duty under Section 9-609 to refrain from breaching the peace.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-604)
Sec. 9-604. Procedure if security agreement covers real property or fixtures.
(a) Enforcement: personal and real property. If a security agreement covers both personal and real property, a secured party may proceed:
(b) Enforcement: fixtures. Subject to subsection (c), if a security agreement covers goods that are or become fixtures, a secured party may proceed:
(c) Removal of fixtures. Subject to the other provisions of this Part, if a secured party holding a security interest in fixtures has priority over all owners and encumbrancers of the real property, the secured party, after default, may remove the collateral from the real property.
(d) Injury caused by removal. A secured party that removes collateral shall promptly reimburse any encumbrancer or owner of the real property, other than the debtor, for the cost of repair of any physical injury caused by the removal. The secured party need not reimburse the encumbrancer or owner for any diminution in value of the real property caused by the absence of the goods removed or by any necessity of replacing them. A person entitled to reimbursement may refuse permission to remove until the secured party gives adequate assurance for the performance of the obligation to reimburse.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-605)
Sec. 9-605. Unknown debtor or secondary obligor. A secured party does not owe a duty based on its status as secured party:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-606)
Sec. 9-606. Time of default for agricultural lien. For purposes of this Part, a default occurs in connection with an agricultural lien at the time the secured party becomes entitled to enforce the lien in accordance with the statute under which it was created.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-607)
Sec. 9-607. Collection and enforcement by secured party.
(a) Collection and enforcement generally. If so agreed, and in any event after default, a secured party:
(b) Nonjudicial enforcement of mortgage. If necessary to enable a secured party to exercise under subsection (a)(3) the right of a debtor to enforce a mortgage nonjudicially, the secured party may record in the office in which a record of the mortgage is recorded:
(c) Commercially reasonable collection and enforcement. A secured party shall proceed in a commercially reasonable manner if the secured party:
(d) Expenses of collection and enforcement. A secured party may deduct from the collections made pursuant to subsection (c) reasonable expenses of collection and enforcement, including reasonable attorney's fees and legal expenses incurred by the secured party.
(e) Duties to secured party not affected. This Section does not determine whether an account debtor, bank, or other person obligated on collateral owes a duty to a secured party.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-608)
Sec. 9-608. Application of proceeds of collection or enforcement; liability for deficiency and right to surplus.
(a) Application of proceeds, surplus, and deficiency if obligation secured. If a security interest or agricultural lien secures payment or performance of an obligation, the following rules apply:
(b) No surplus or deficiency in sales of certain rights to payment. If the underlying transaction is a sale of accounts, chattel paper, payment intangibles, or promissory notes, the debtor is not entitled to any surplus, and the obligor is not liable for any deficiency.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-609)
Sec. 9-609. Secured party's right to take possession after default.
(a) Possession; rendering equipment unusable; disposition on debtor's premises. After default, a secured party:
(b) Judicial and nonjudicial process. A secured party may proceed under subsection (a):
(c) Assembly of collateral. If so agreed, and in any event after default, a secured party may require the debtor to assemble the collateral and make it available to the secured party at a place to be designated by the secured party which is reasonably convenient to both parties.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-610)
Sec. 9-610. Disposition of collateral after default.
(a) Disposition after default. After default, a secured party may sell, lease, license, or otherwise dispose of any or all of the collateral in its present condition or following any commercially reasonable preparation or processing.
(b) Commercially reasonable disposition. Every aspect of a disposition of collateral, including the method, manner, time, place, and other terms, must be commercially reasonable. If commercially reasonable, a secured party may dispose of collateral by public or private proceedings, by one or more contracts, as a unit or in parcels, and at any time and place and on any terms.
(c) Purchase by secured party. A secured party may purchase collateral:
(d) Warranties on disposition. A contract for sale, lease, license, or other disposition includes the warranties relating to title, possession, quiet enjoyment, and the like which by operation of law accompany a voluntary disposition of property of the kind subject to the contract.
(e) Disclaimer of warranties. A secured party may disclaim or modify warranties under subsection (d):
(f) Record sufficient to disclaim warranties. A record is sufficient to disclaim warranties under subsection (e) if it indicates "There is no warranty relating to title, possession, quiet enjoyment, or the like in this disposition" or uses words of similar import.
(g) The provisions of this Section are subject to Section 26.5 of the Retail Installment Sales Act.
(Source: P.A. 97-913, eff. 1-1-13.)
(810 ILCS 5/9-611)
Sec. 9-611. Notification before disposition of collateral.
(a) "Notification date." In this Section, "notification date" means the earlier of the date on which:
(b) Notification of disposition required. Except as otherwise provided in subsection (d), a secured party that disposes of collateral under Section 9-610 shall send to the persons specified in subsection (c) a reasonable authenticated notification of disposition.
(c) Persons to be notified. To comply with subsection (b), the secured party shall send an authenticated notification of disposition to:
(d) Subsection (b) inapplicable: perishable collateral; recognized market. Subsection (b) does not apply if the collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market.
(e) Compliance with subsection (c)(3)(B). A secured party complies with the requirement for notification prescribed by subsection (c)(3)(B) if:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-612)
Sec. 9-612. Timeliness of notification before disposition of collateral.
(a) Reasonable time is question of fact. Except as otherwise provided in subsection (b), whether a notification is sent within a reasonable time is a question of fact. The limitation of the rule in subsection (b) to transactions other than consumer-goods transactions is intended to leave to the court the determination of the proper rules in consumer-goods transactions. The court may not infer from that limitation the nature of the proper rule in consumer-goods transactions and may continue to apply established approaches.
(b) 10-day period sufficient in non-consumer transaction. In a transaction other than a consumer transaction, a notification of disposition sent after default and 10 days or more before the earliest time of disposition set forth in the notification is sent within a reasonable time before the disposition.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-613)
Sec. 9-613. Contents and form of notification before disposition of collateral: general. Except in a consumer-goods transaction, the following rules apply:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-614)
Sec. 9-614. Contents and form of notification before disposition of collateral: consumer-goods transaction. In a consumer-goods transaction, the following rules apply:
............. (Name and address of secured party)
............. (Date)
......................................................
(Name and address of any obligor who is also a debtor)
Subject: ..................................
(Identification of Transaction)
Date: ................................
Time: ................................
Place: ................................
.................................................
(Names of all other debtors and obligors, if any)
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-615)
Sec. 9-615. Application of proceeds of disposition; liability for deficiency and right to surplus.
(a) Application of proceeds. A secured party shall apply or pay over for application the cash proceeds of disposition in the following order to:
(b) Proof of subordinate interest. If requested by a secured party, a holder of a subordinate security interest or other lien shall furnish reasonable proof of the interest or lien within a reasonable time. Unless the holder does so, the secured party need not comply with the holder's demand under subsection (a)(3).
(c) Application of noncash proceeds. A secured party need not apply or pay over for application noncash proceeds of disposition under this Section unless the failure to do so would be commercially unreasonable. A secured party that applies or pays over for application noncash proceeds shall do so in a commercially reasonable manner.
(d) Surplus or deficiency if obligation secured. If the security interest under which a disposition is made secures payment or performance of an obligation, after making the payments and applications required by subsection (a) and permitted by subsection (c):
(e) No surplus or deficiency in sales of certain rights to payment. If the underlying transaction is a sale of accounts, chattel paper, payment intangibles, or promissory notes:
(f) Calculation of surplus or deficiency in disposition to person related to secured party. The surplus or deficiency following a disposition is calculated based on the amount of proceeds that would have been realized in a disposition complying with this Part and described in subsection (f)(2) of this Section to a transferee other than the secured party, a person related to the secured party, or a secondary obligor if:
(g) Cash proceeds received by junior secured party. A secured party that receives cash proceeds of a disposition in good faith and without knowledge that the receipt violates the rights of the holder of a security interest or other lien that is not subordinate to the security interest or agricultural lien under which the disposition is made:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-616)
Sec. 9-616. Explanation of calculation of surplus or deficiency.
(a) Definitions. In this Section:
(b) Explanation of calculation. In a consumer-goods transaction in which the debtor is entitled to a surplus or a consumer obligor is liable for a deficiency under Section 9-615, the secured party shall:
(c) Required information for response to request. To comply with a request, the secured party must provide a response in writing which includes the following information:
(d) Substantial compliance. A particular phrasing of the explanation or response to a request is not required. An explanation or a response to a request complying substantially with the requirements of this Section is sufficient even if it is:
(e) Charges for responses. A debtor or consumer obligor is entitled without charge to one response to a request under this Section during any six-month period in which the secured party did not send to the debtor or consumer obligor an explanation pursuant to subsection (b)(1). The secured party may require payment of a charge not exceeding $25 for each additional response.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-617)
Sec. 9-617. Rights of transferee of collateral.
(a) Effects of disposition. A secured party's disposition of collateral after default:
(b) Rights of good-faith transferee. A transferee that acts in good faith takes free of the rights and interests described in subsection (a), even if the secured party fails to comply with this Article or the requirements of any judicial proceeding.
(c) Rights of other transferee. If a transferee does not take free of the rights and interests described in subsection (a), the transferee takes the collateral subject to:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-618)
Sec. 9-618. Rights and duties of certain secondary obligors.
(a) Rights and duties of secondary obligor. A secondary obligor acquires the rights and becomes obligated to perform the duties of the secured party after the secondary obligor:
(b) Effect of assignment, transfer, or subrogation. An assignment, transfer, or subrogation described in subsection (a):
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-619)
Sec. 9-619. Transfer of record or legal title.
(a) "Transfer statement." In this Section, "transfer statement" means a record authenticated by a secured party stating:
(b) Effect of transfer statement. A transfer statement entitles the transferee to the transfer of record of all rights of the debtor in the collateral specified in the statement in any official filing, recording, registration, or certificate-of-title system covering the collateral. If a transfer statement is presented with the applicable fee and request form to the official or office responsible for maintaining the system, the official or office shall:
(c) Transfer not a disposition; no relief of secured party's duties. A transfer of the record or legal title to collateral to a secured party under subsection (b) or otherwise is not of itself a disposition of collateral under this Article and does not of itself relieve the secured party of its duties under this Article.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-620)
Sec. 9-620. Acceptance of collateral in full or partial satisfaction of obligation; compulsory disposition of collateral.
(a) Conditions to acceptance in satisfaction. Except as otherwise provided in subsection (g), a secured party may accept collateral in full or partial satisfaction of the obligation it secures only if:
(b) Purported acceptance ineffective. A purported or apparent acceptance of collateral under this Section is ineffective unless:
(c) Debtor's consent. For purposes of this Section:
(d) Effectiveness of notification. To be effective under subsection (a)(2), a notification of objection must be received by the secured party:
(e) Mandatory disposition of consumer goods. A secured party that has taken possession of collateral shall dispose of the collateral pursuant to Section 9-610 within the time specified in subsection (f) if:
(f) Compliance with mandatory disposition requirement. To comply with subsection (e), the secured party shall dispose of the collateral:
(g) No partial satisfaction in consumer transaction. In a consumer transaction, a secured party may not accept collateral in partial satisfaction of the obligation it secures.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-621)
Sec. 9-621. Notification of proposal to accept collateral.
(a) Persons to which proposal to be sent. A secured party that desires to accept collateral in full or partial satisfaction of the obligation it secures shall send its proposal to:
(b) Proposal to be sent to secondary obligor in partial satisfaction. A secured party that desires to accept collateral in partial satisfaction of the obligation it secures shall send its proposal to any secondary obligor in addition to the persons described in subsection (a).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-622)
Sec. 9-622. Effect of acceptance of collateral.
(a) Effect of acceptance. A secured party's acceptance of collateral in full or partial satisfaction of the obligation it secures:
(b) Discharge of subordinate interest notwithstanding noncompliance. A subordinate interest is discharged or terminated under subsection (a), even if the secured party fails to comply with this Article.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-623)
Sec. 9-623. Right to redeem collateral.
(a) Persons that may redeem. A debtor, any secondary obligor, or any other secured party or lienholder may redeem collateral.
(b) Requirements for redemption. To redeem collateral, a person shall tender:
(c) When redemption may occur. A redemption may occur at any time before a secured party:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-624)
Sec. 9-624. Waiver.
(a) Waiver of disposition notification. A debtor or secondary obligor may waive the right to notification of disposition of collateral under Section 9-611 only by an agreement to that effect entered into and authenticated after default.
(b) Waiver of mandatory disposition. A debtor may waive the right to require disposition of collateral under Section 9-620(e) only by an agreement to that effect entered into and authenticated after default.
(c) Waiver of redemption right. A debtor or secondary obligor may waive the right to redeem collateral under Section 9-623 only by an agreement to that effect entered into and authenticated after default.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art 9, P6, Sub 2 heading)
(810 ILCS 5/9-625)
Sec. 9-625. Remedies for secured party's failure to comply with Article.
(a) Judicial orders concerning noncompliance. If it is established that a secured party is not proceeding in accordance with this Article, a court may order or restrain collection, enforcement, or disposition of collateral on appropriate terms and conditions.
(b) Damages for noncompliance. Subject to subsections (c), (d), and (f), a person is liable for damages in the amount of any loss caused by a failure to comply with this Article. Loss caused by a failure to comply with a request under Section 9-210 may include loss resulting from the debtor's inability to obtain, or increased costs of, alternative financing.
(c) Persons entitled to recover damages; statutory damages if collateral is consumer goods. Except as otherwise provided in Section 9-628:
(d) Recovery when deficiency eliminated or reduced. A debtor whose deficiency is eliminated under Section 9-626 may recover damages for the loss of any surplus. However, a debtor or secondary obligor whose deficiency is eliminated or reduced under Section 9-626 may not otherwise recover under subsection (b) for noncompliance with the provisions of this Part relating to collection, enforcement, disposition, or acceptance.
(e) Statutory damages: noncompliance with specified provisions. In addition to any damages recoverable under subsection (b), the debtor, consumer obligor, or person named as a debtor in a filed record, as applicable, may recover in an individual action $500 for each instance that a person:
(f) Statutory damages: noncompliance with Section 9-210. A debtor or consumer obligor may recover damages under subsection (b) and, in addition, may in an individual action recover $500 in each case from a person that, without reasonable cause, fails to comply with a request under Section 9-210. A recipient of a request under Section 9-210 which never claimed an interest in the collateral or obligations that are the subject of a request under that Section has a reasonable excuse for failure to comply with the request within the meaning of this subsection.
(g) Limitation of security interest: noncompliance with Section 9-210. If a secured party fails to comply with a request regarding a list of collateral or a statement of account under Section 9-210, the secured party may claim a security interest only as shown in the statement included in the request as against a person that is reasonably misled by the failure.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-626)
Sec. 9-626. Action in which deficiency or surplus is in issue; applicable rules if amount of deficiency or surplus is in issue. In an action in which the amount of a deficiency or surplus is in issue, the following rules apply:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-627)
Sec. 9-627. Determination of whether conduct was commercially reasonable.
(a) Greater amount obtainable under other circumstances; no preclusion of commercial reasonableness. The fact that a greater amount could have been obtained by a collection, enforcement, disposition, or acceptance at a different time or in a different method from that selected by the secured party is not of itself sufficient to preclude the secured party from establishing that the collection, enforcement, disposition, or acceptance was made in a commercially reasonable manner.
(b) Dispositions that are commercially reasonable. A disposition of collateral is made in a commercially reasonable manner if the disposition is made:
(c) Approval by court or on behalf of creditors. A collection, enforcement, disposition, or acceptance is commercially reasonable if it has been approved:
(d) Approval under subsection (c) not necessary; absence of approval has no effect. Approval under subsection (c) need not be obtained, and lack of approval does not mean that the collection, enforcement, disposition, or acceptance is not commercially reasonable.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-628)
Sec. 9-628. Nonliability and limitation on liability of secured party; liability of secondary obligor.
(a) Limitation of liability to debtor or obligor. Unless a secured party knows that a person is a debtor or obligor, knows the identity of the person, and knows how to communicate with the person:
(b) Limitation of liability to debtor, obligor, another secured party, or lienholder. A secured party is not liable because of its status as secured party:
(c) Limitation of liability if reasonable belief that transaction not a consumer-goods transaction or consumer transaction. A secured party is not liable to any person, and a person's liability for a deficiency is not affected, because of any act or omission arising out of the secured party's reasonable belief that a transaction is not a consumer-goods transaction or a consumer transaction or that goods are not consumer goods, if the secured party's belief is based on its reasonable reliance on:
(d) Limitation of liability for statutory damages. A secured party is not liable to any person under Section 9-625(c)(2) for its failure to comply with Section 9-616.
(e) Limitation of multiple liability for statutory damages. A secured party is not liable under Section 9-625(c)(2) more than once with respect to any one secured obligation.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 7 heading)
(810 ILCS 5/9-701)
Sec. 9-701. Effective date. (See Section 99 of the Public Act adding this Section to this Act.)
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-702)
Sec. 9-702. Savings clause.
(a) Pre-effective-date transactions or liens. Except as otherwise provided in this Part, this Act applies to a transaction or lien within its scope, even if the transaction or lien was entered into or created before the effective date of this amendatory Act of the 91st General Assembly.
(b) Continuing validity. Except as otherwise provided in subsection (c) and Sections 9-703 through 9-709:
(c) Pre-effective-date proceedings. This amendatory Act of the 91st General Assembly does not affect an action, case, or proceeding commenced before the effective date of this amendatory Act of the 91st General Assembly.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-703)
Sec. 9-703. Security interest perfected before effective date.
(a) Continuing priority over lien creditor: perfection requirements satisfied. A security interest that is enforceable immediately before the effective date of this amendatory Act of the 91st General Assembly and would have priority over the rights of a person that becomes a lien creditor at that time is a perfected security interest under this Act if, on the effective date of this amendatory Act of the 91st General Assembly, the applicable requirements for enforceability and perfection under this Act are satisfied without further action.
(b) Continuing priority over lien creditor: perfection requirements not satisfied. Except as otherwise provided in Section 9-705, if, immediately before the effective date of this amendatory Act of the 91st General Assembly, a security interest is enforceable and would have priority over the rights of a person that becomes a lien creditor at that time, but the applicable requirements for enforceability or perfection under this Act are not satisfied on the effective date of this amendatory Act of the 91st General Assembly, the security interest:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-704)
Sec. 9-704. Security interest unperfected before effective date. A security interest that is enforceable immediately before the effective date of this amendatory Act of the 91st General Assembly but which would be subordinate to the rights of a person that becomes a lien creditor at that time:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-705)
Sec. 9-705. Effectiveness of action taken before effective date.
(a) Pre-effective-date action; one-year perfection period unless reperfected. If action, other than the filing of a financing statement, is taken before the effective date of this amendatory Act of the 91st General Assembly and the action would have resulted in priority of a security interest over the rights of a person that becomes a lien creditor had the security interest become enforceable before the effective date of this amendatory Act of the 91st General Assembly, the action is effective to perfect a security interest that attaches under this Act within one year after the effective date of this amendatory Act of the 91st General Assembly. An attached security interest becomes unperfected one year after the effective date of this amendatory Act of the 91st General Assembly unless the security interest becomes a perfected security interest under this Act before the expiration of that period.
(b) Pre-effective-date filing. The filing of a financing statement before the effective date of this amendatory Act of the 91st General Assembly is effective to perfect a security interest to the extent the filing would satisfy the applicable requirements for perfection under this Act.
(c) Pre-effective-date filing in jurisdiction formerly governing perfection. This Act does not render ineffective an effective financing statement that, before the effective date of this amendatory Act of the 91st General Assembly, is filed and satisfies the applicable requirements for perfection under the law of the jurisdiction governing perfection as provided in Section 9-103 of the Uniform Commercial Code as it existed before the effective date of this amendatory Act of the 91st General Assembly. However, except as otherwise provided in subsections (d) and (e) and Section 9-706, the financing statement ceases to be effective at the earlier of:
(d) Continuation statement. The filing of a continuation statement after the effective date of this amendatory Act of the 91st General Assembly does not continue the effectiveness of the financing statement filed before the effective date of this amendatory Act of the 91st General Assembly. However, upon the timely filing of a continuation statement after the effective date of this amendatory Act of the 91st General Assembly and in accordance with the law of the jurisdiction governing perfection as provided in Part 3, the effectiveness of a financing statement filed in the same office in that jurisdiction before the effective date of this amendatory Act of the 91st General Assembly continues for the period provided by the law of that jurisdiction.
(e) Application of subsection (c)(2) to transmitting utility financing statement. Subsection (c)(2) applies to a financing statement that, before the effective date of this amendatory Act of the 91st General Assembly, is filed against a transmitting utility and satisfies the applicable requirements for perfection under the law of the jurisdiction governing perfection as provided in Section 9-103, as that Section existed before the effective date of this amendatory Act of the 91st General Assembly, only to the extent that Part 3 provides that the law of a jurisdiction other than jurisdiction in which the financing statement is filed governs perfection of a security interest in collateral covered by the financing statement.
(f) Application of Part 5. A financing statement that includes a financing statement filed before the effective date of this amendatory Act of the 91st General Assembly and a continuation statement filed after the effective date of this amendatory Act of the 91st General Assembly is effective only to the extent that it satisfies the requirements of Part 5 for an initial financing statement.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-706)
Sec. 9-706. When initial financing statement suffices to continue effectiveness of financing statement.
(a) Initial financing statement in lieu of continuation statement. The filing of an initial financing statement in the office specified in Section 9-501 continues the effectiveness of a financing statement filed before the effective date of this amendatory Act of the 91st General Assembly if:
(b) Period of continued effectiveness. The filing of an initial financing statement under subsection (a) continues the effectiveness of the pre-effective-date financing statement:
(c) Requirements for initial financing statement under subsection (a). To be effective for purposes of subsection (a), an initial financing statement must:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-707)
Sec. 9-707. Amendment of pre-effective-date financing statement.
(a) "Pre-effective-date financing statement". In this Section, "pre-effective-date financing statement" means a financing statement filed before the effective date of this amendatory Act of the 91st General Assembly.
(b) Applicable law. After the effective date of this amendatory Act of the 91st General Assembly, a person may add or delete collateral covered by, continue or terminate the effectiveness of, or otherwise amend the information provided in, a pre-effective-date financing statement only in accordance with the law of the jurisdiction governing perfection as provided in Part 3. However, the effectiveness of a pre-effective-date financing statement also may be terminated in accordance with the law of the jurisdiction in which the financing statement is filed.
(c) Method of amending: general rule. Except as otherwise provided in subsection (d), if the law of this State governs perfection of a security interest, the information in a pre-effective-date financing statement may be amended after the effective date of this amendatory Act of the 91st General Assembly only if:
(d) Method of amending: continuation. If the law of this State governs perfection of a security interest, the effectiveness of a pre-effective-date financing statement may be continued only under Section 9-705(d) and (f) or Section 9-706.
(e) Method of amending: additional termination rule. Whether or not the law of this State governs perfection of a security interest, the effectiveness of a pre-effective-date financing statement filed in this State may be terminated after the effective date of this amendatory Act of the 91st General Assembly by filing a termination statement in the office in which the pre-effective-date financing statement is filed, unless an initial financing statement that satisfies Section 9-706(c) has been filed in the office specified by the law of the jurisdiction governing perfection as provided in Part 3 as the office in which to file a financing statement.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-708)
Sec. 9-708. Persons entitled to file initial financing statement or continuation statement. A person may file an initial financing statement or a continuation statement under this Part if:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-709)
Sec. 9-709. Priority.
(a) Law governing priority. This Act determines the priority of conflicting claims to collateral. However, if the relative priorities of the claims were established before the effective date of this amendatory Act of the 91st General Assembly, Article 9 as it existed before the effective date of this amendatory Act of the 91st General Assembly determines priority.
(b) Priority if security interest becomes enforceable under Section 9-203. For purposes of Section 9-322(a), the priority of a security interest that becomes enforceable under Section 9-203 of this Act dates from the effective date of this amendatory Act of the 91st General Assembly if the security interest is perfected under this Act by the filing of a financing statement before the effective date of this amendatory Act of the 91st General Assembly which would not have been effective to perfect the security interest under Article 9 as it existed before the effective date of this amendatory Act of the 91st General Assembly. This subsection does not apply to conflicting security interests each of which is perfected by the filing of such a financing statement.
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-710)
Sec. 9-710. Local-filing office responsibilities for filings under the Uniform Commercial Code prior to this amendatory Act of the 91st General Assembly.
(a) In this Section:
(b) Except for a record terminating a former-Article-9 record, a local-filing office must not accept for filing a record presented after June 30, 2001, whether or not the record relates to a financing statement filed in the local-filing office before July 1, 2001. If the record terminating such former-Article-9 record statement is in the standard form prescribed by the Secretary of State, the uniform fee for filing and indexing the termination statement in the office of a county recorder shall be $5 and otherwise shall be $10, plus in each case an additional fee of $5 for each name more than one at each address listed against which the record is required to be indexed.
(c) Until July 1, 2001, each local-filing office must maintain all former-Article-9 records in accordance with the Uniform Commercial Code as in effect immediately before the effective date of this amendatory Act of the 91st General Assembly. A former-Article-9 record that is not reflected on the index maintained on June 30, 2001, by the local-filing office must be processed and indexed, and reflected on the index as of June 30, 2001, as soon as practicable but in any event no later than July 30, 2001.
(d) Until at least June 30, 2008, each local-filing office must respond to requests for information with respect to former-Article-9 records relating to a debtor and issue certificates, in accordance with the Uniform Commercial Code as in effect immediately before this amendatory Act of the 91st General Assembly. The fees charged for responding to requests for information relating to the debtor issuing the certificates with respect to former-Article-9 records must be the fees in effect under the Uniform Commercial Code as in effect immediately before the effective date of this amendatory Act of the 91st General Assembly on June 30, 2001, unless a different fee is later set by the local filing office. However, the different fee must not exceed $10 for responding to a request for information relating to a debtor or $10 for issuing a certificate.
(e) After June 30, 2008, each local-filing office may remove and destroy, in accordance with any then applicable record retention law of this State, all former-Article-9 records, including the related index.
(f) This Section does not apply, with respect to financing statements and other records, to a filing office in which mortgages or records of mortgages on real property are required to be filed or recorded if:
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/Art. 9 Pt. 8 heading)
(810 ILCS 5/9-801)
Sec. 9-801. Effective date. (See Section 99 of the Public Act adding this Section to this Act.)
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-802)
Sec. 9-802. Savings clause.
(a) Pre-effective-date transactions or liens. Except as otherwise provided in this Part, this Act applies to a transaction or lien within its scope, even if the transaction or lien was entered into or created before the effective date of this amendatory Act of the 97th General Assembly.
(b) Pre-effective-date proceedings. This amendatory Act of the 97th General Assembly does not affect an action, case, or proceeding commenced before the effective date of this amendatory Act of the 97th General Assembly.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-803)
Sec. 9-803. Security interest perfected before effective date.
(a) Continuing perfection: perfection requirements satisfied. A security interest that is a perfected security interest immediately before the effective date of this amendatory Act of the 97th General Assembly is a perfected security interest under Article 9 as amended by this amendatory Act of the 97th General Assembly if, on the effective date of this amendatory Act of the 97th General Assembly, the applicable requirements for attachment and perfection under Article 9 as amended by this amendatory Act of the 97th General Assembly are satisfied without further action.
(b) Continuing perfection: perfection requirements not satisfied. Except as otherwise provided in Section 9-805, if, immediately before the effective date of this amendatory Act of the 97th General Assembly, a security interest is a perfected security interest, but the applicable requirements for perfection under Article 9 as amended by this amendatory Act of the 97th General Assembly are not satisfied when this amendatory Act of the 97th General Assembly takes effect, the security interest remains perfected thereafter only if the applicable requirements for perfection under Article 9 as amended by this amendatory Act of the 97th General Assembly are satisfied within one year after the effective date of this amendatory Act of the 97th General Assembly.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-804)
Sec. 9-804. Security interest unperfected before the effective date of this amendatory Act of the 97th General Assembly. A security interest that is an unperfected security interest immediately before the effective date of this amendatory Act of the 97th General Assembly becomes a perfected security interest:
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-805)
Sec. 9-805. Effectiveness of action taken before the effective date of this amendatory Act of the 97th General Assembly.
(a) Pre-effective-date filing effective. The filing of a financing statement before the effective date of this amendatory Act of the 97th General Assembly is effective to perfect a security interest to the extent the filing would satisfy the applicable requirements for perfection under Article 9 as amended by this amendatory Act of the 97th General Assembly.
(b) When pre-effective-date filing becomes ineffective. This amendatory Act of the 97th General Assembly does not render ineffective an effective financing statement that, before the effective date of this amendatory Act of the 97th General Assembly, is filed and satisfies the applicable requirements for perfection under the law of the jurisdiction governing perfection as provided in Article 9 as it existed before the effective date of this amendatory Act of the 97th General Assembly. However, except as otherwise provided in subsections (c) and (d) and Section 9-806, the financing statement ceases to be effective:
(c) Continuation statement. The filing of a continuation statement after the effective date of this amendatory Act of the 97th General Assembly does not continue the effectiveness of a financing statement filed before the effective date of this amendatory Act of the 97th General Assembly. However, upon the timely filing of a continuation statement after the effective date of this amendatory Act of the 97th General Assembly and in accordance with the law of the jurisdiction governing perfection as provided in Article 9, the effectiveness of a financing statement filed in the same office in that jurisdiction before the effective date of this amendatory Act of the 97th General Assembly continues for the period provided by the law of that jurisdiction.
(d) Application of subsection (b)(2)(B) to transmitting utility financing statement. Subsection (b)(2)(B) applies to a financing statement that, before the effective date of this amendatory Act of the 97th General Assembly, is filed against a transmitting utility and satisfies the applicable requirements for perfection under the law of the jurisdiction governing perfection as provided in Article 9 as it existed before the effective date of this amendatory Act of the 97th General Assembly, only to the extent that Article 9 as amended by this amendatory Act of the 97th General Assembly provides that the law of a jurisdiction other than the jurisdiction in which the financing statement is filed governs perfection of a security interest in collateral covered by the financing statement.
(e) Application of Part 5. A financing statement that includes a financing statement filed before the effective date of this amendatory Act of the 97th General Assembly and a continuation statement filed after the effective date of this amendatory Act of the 97th General Assembly is effective only to the extent that it satisfies the requirements of Part 5 as amended by this amendatory Act of the 97th General Assembly for an initial financing statement. A financing statement that indicates that the debtor is a decedent's estate indicates that the collateral is being administered by a personal representative within the meaning of Section 9-503(a)(2) as amended by this amendatory Act of the 97th General Assembly. A financing statement that indicates that the debtor is a trust or is a trustee acting with respect to property held in trust indicates that the collateral is held in a trust within the meaning of Section 9-503(a)(3) as amended by this amendatory Act of the 97th General Assembly.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-806)
Sec. 9-806. When initial financing statement suffices to continue effectiveness of financing statement.
(a) Initial financing statement in lieu of continuation statement. The filing of an initial financing statement in the office specified in Section 9-501 continues the effectiveness of a financing statement filed before the effective date of this amendatory Act of the 97th General Assembly if:
(b) Period of continued effectiveness. The filing of an initial financing statement under subsection (a) continues the effectiveness of the pre-effective-date financing statement:
(c) Requirements for initial financing statement under subsection (a). To be effective for purposes of subsection (a), an initial financing statement must:
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-807)
Sec. 9-807. Amendment of pre-effective-date financing statement.
(a) "Pre-effective-date financing statement". In this Section, "pre-effective-date financing statement" means a financing statement filed before the effective date of this amendatory Act of the 97th General Assembly.
(b) Applicable law. After this amendatory Act of the 97th General Assembly takes effect, a person may add or delete collateral covered by, continue or terminate the effectiveness of, or otherwise amend the information provided in, a pre-effective-date financing statement only in accordance with the law of the jurisdiction governing perfection as provided in Article 9 as amended by this amendatory Act of the 97th General Assembly. However, the effectiveness of a pre-effective-date financing statement also may be terminated in accordance with the law of the jurisdiction in which the financing statement is filed.
(c) Method of amending: general rule. Except as otherwise provided in subsection (d), if the law of this State governs perfection of a security interest, the information in a pre-effective-date financing statement may be amended after the effective date of this amendatory Act of the 97th General Assembly only if:
(d) Method of amending: continuation. If the law of this State governs perfection of a security interest, the effectiveness of a pre-effective-date financing statement may be continued only under Section 9-805(c) and (e) or 9-806.
(e) Method of amending: additional termination rule. Whether or not the law of this State governs perfection of a security interest, the effectiveness of a pre-effective-date financing statement filed in this State may be terminated after the effective date of this amendatory Act of the 97th General Assembly by filing a termination statement in the office in which the pre-effective-date financing statement is filed, unless an initial financing statement that satisfies Section 9-806(c) has been filed in the office specified by the law of the jurisdiction governing perfection as provided in Article 9 as amended by this amendatory Act of the 97th General Assembly as the office in which to file a financing statement.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-808)
Sec. 9-808. Person entitled to file initial financing statement or continuation statement. A person may file an initial financing statement or a continuation statement under this part if:
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/9-809)
Sec. 9-809. Priority. This Act determines the priority of conflicting claims to collateral. However, if the relative priorities of the claims were established before the effective date of this amendatory Act of the 97th General Assembly, Article 9 as it existed before the effective date of this amendatory Act of the 97th General Assembly determines priority.
(Source: P.A. 97-1034, eff. 7-1-13.)
(810 ILCS 5/Art. 9 Pt. 99 heading)
(810 ILCS 5/9-9901) (from Ch. 26, par. 9-9901)
Sec. 9-9901. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)
(810 ILCS 5/9-9902) (from Ch. 26, par. 9-9902)
Sec. 9-9902. (Blank).
(Source: P.A. 91-893, eff. 7-1-01.)