secured transactions assignment 8
Post on 31-Dec-2015
64 Views
Preview:
DESCRIPTION
TRANSCRIPT
1
Secured TransactionsAssignment 8
Formalities for Attachment
2
The Big Picture
Chapter 1. Creditors’ Remedies Under State Law
Chapter 2. Creditors’ Remedies in Bankruptcy
Chapter 3. Creation of Security Interests
Assignment 8: Formalities for Attachment
Assignment 9: What Collateral and Obligations are Covered?
Assignment 10: Proceeds (State Law)
Assignment 11: Proceeds (Bankruptcy)
Assignment 12: Skip
3
The Big Picture
Chapter 1. Creditors’ Remedies Under State Law
Chapter 2. Creditors’ Remedies in Bankruptcy
Chapter 3. Creation of Security Interests
Assignment 8: Formalities for Attachment
Assignment 9: What Collateral and Obligations are Covered?
Assignment 10: Proceeds (State Law)
Assignment 11: Proceeds (Bankruptcy)
Assignment 12: Skip
4
The Big Picture
Chapter 1. Creditors’ Remedies Under State Law
Chapter 2. Creditors’ Remedies in Bankruptcy
Chapter 3. Creation of Security Interests
Assignment 8: Formalities for Attachment
Assignment 9: What Collateral and Obligations are Covered?
Assignment 10: Proceeds (State Law)
Assignment 11: Proceeds (Bankruptcy)
5
UCC Article 1
1. Definitions and provisions applicable in all other Articles
2. “Current” Article 1, “Revised” Article 1
3. A majority of states have adopted Revised Article 1.
4. Revised Article 1 is the “law of the course.”
6
Basic Concepts
Attachment: creation of a security interest
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-201(44))
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
Asset“Collateral”
Debt“Obligation”
LienSecurity interest
7
Basic Concepts
Attachment: creation of a security interest
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-201(44))
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
Asset“Collateral”
Debt“Obligation”
LienSecurity interest
8
Basic Concepts
Attachment: creation of a security interest
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-204)
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
Asset“Collateral”
Debt“Obligation”
LienSecurity interest
9
Basic Concepts
Attachment: creation of a security interest
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-204)
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
Asset“Collateral”
Debt“Obligation”
LienSecurity interest
10
Basic Concepts
Value has been given [by the secured party]
11
Basic Concepts
Value has been given [by the secured party]
Securedparty Debtor
Security interest
?
12
Basic Concepts
Value has been given [by the secured party]
Securedparty Debtor
Loan or loan commitment
Security interest
13
Basic Concepts
Value has been given [by the secured party]
Securedparty Debtor
A loan made unsecured (“past consideration”) is value with respect to a later-granted security interest
Security interest
Previouslyunsecured loan
14
Basic Concepts
Value has been given [by the secured party]
§1-204. [A] person gives “value” for rights if the person acquires them . . . (2) as security for . . . a pre-existing claim . . . or (4) in return for any consideration sufficient to support a simple contract.
Securedparty Debtor
Security interest
A loan made unsecured (“past consideration”) is value with respect to a later-granted security interest
Previouslyunsecured loan
15
Basic Concepts
Debtor has rights in the collateral [ownership, lease, etc.]
16
Basic Concepts
Debtor has rights in the collateral [ownership, lease, etc.]
Securedparty
Trademarkowner
Debtor-licensee
Security interestIn “trademark”License
17
Basic Concepts
Debtor has rights in the collateral [ownership, lease, etc.]
Securedparty
Seller Debtor
Bad check
SecurityinterestTitle to goods
18
Basic Concepts
Debtor has rights in the collateral [ownership, lease, etc.]
Securedparty
Seller Debtor
No consideration yet paid
Securityinterest
Rights in goods not yet delivered
19
Basic Concepts
Debtor has rights in the collateral [ownership, lease, etc.]
§2-501(1)(a) The buyer obtains a special property . . . interest in goods by identification of existing goods as goods to which the contract refers . . . . In the absence of explicit agreement identification occurs when the contract is made if it is for the sale of goods already existing and identified.
Securedparty
Seller Debtor
No consideration paid
Securityinterest“Identification”
20
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Record . . . means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is something in my memory a record?
21
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Record . . . means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is something in my memory a record?
22
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Record . . . means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is something in my memory a record?
23
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Record . . . means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is something in my memory a record?
24
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Example: I sent you an email stating “I grant you a security interest in my car. B.M.Mc.” tronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is something in my memory a record?
25
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Record . . . means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is something in my memory a record?
26
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Record . . . means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is an oral security agreement a record?
27
Basic Concepts
Debtor has authenticated a security agreement . . .
§9-102(a)(7). Authenticate means:
(A) to sign; or
(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.
Record . . . means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. §9-102(a)(69)
Is an oral security agreement a record? Is my recollection of it a record?
28
Basic Concepts
Security agreement . . . §9-102(a)(73). Security agreement means an agreement that creates or provides
for a security interest.
That provides a description of the collateral
§9-108(a) [A] description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
(b) [A] description of collateral reasonably identifies the collateral if . . . the identity of the collateral is “objectively determinable.
29
Basic Concepts
Security agreement . . .
§9-102(a)(73). Security agreement means an agreement that creates or provides for a security interest.
That provides a description of the collateral
§9-108(a) [A] description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
(b) [A] description of collateral reasonably identifies the collateral if . . . the identity of the collateral is “objectively determinable.
30
Basic Concepts
Security agreement . . .
§9-102(a)(73). Security agreement means an agreement that creates or provides for a security interest.
. . . that provides a description of the collateral
§9-108(a) [A] description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
(b) [A] description of collateral reasonably identifies the collateral if . . . the identity of the collateral is “objectively determinable.
31
Basic Concepts
Security agreement . . .
§9-102(a)(73). Security agreement means an agreement that creates or provides for a security interest.
. . . that provides a description of the collateral
§9-108(a) [A] description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
(b) [A] description of collateral reasonably identifies the collateral if . . . the identity of the collateral is “objectively determinable.
32
Basic Concepts
Security agreement . . .
§9-102(a)(73). Security agreement means an agreement that creates or provides for a security interest.
. . . that provides a description of the collateral
§9-108(a) [A] description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
(b) [A] description of collateral reasonably identifies the collateral if . . . the identity of the collateral is “objectively determinable.”
33
34
35
36
37
Problem 8.1, page 145
Promissory Note“secured by col-lateral described in a security agreement this date.” Signed by debtor
Are any of these an authenticated security agreement?
Do they meet the requirements of the composite document rule? “Objectively indicate parties may have intended a SA?” “Parties actually intended a SA” page 144
Can we answer from the documents alone?
38
Problem 8.1, page 145
Promissory Note“secured by col-lateral described in a security agreement this date.” Signed by debtor
Financing State-ment “all inventory and equipment of the debtor’s business” Not signed, but debtor signed authorization to file it
Are any of these an authenticated security agreement?
Do they meet the requirements of the composite document rule? “Objectively indicate parties may have intended a SA?” “Parties actually intended a SA” page 144
Can we answer from the documents alone?
39
Problem 8.1, page 145
Promissory Note“secured by col-lateral described in a security agreement this date.” Signed by debtor
Financing State-ment “all inventory and equipment of the debtor’s business” Not signed, but debtor signed authorization to file it
Cover Letter. “Enclosed are documents that give you a security interest in inventory and equipment,” signed by debtor’s lawyer
Are any of these an authenticated security agreement?
Do they meet the requirements of the composite document rule? “Objectively indicate parties may have intended a SA?” “Parties actually intended a SA” page 144
Can we answer from the documents alone?
40
Problem 8.1, page 145
Promissory Note“secured by col-lateral described in a security agreement this date.” Signed by debtor
Financing State-ment “all inventory and equipment of the debtor’s business” Not signed, but debtor signed authorization to file it
Cover Letter. “Enclosed are documents that give you a security interest in inventory and equipment,” signed by debtor’s lawyer
Are any of these an authenticated security agreement?
Do they meet the requirements of the composite document rule?
“Objectively indicate parties may have intended a SA?”
“Parties actually intended a SA” page 144
Can we answer from the documents alone?
41
Problem 8.1, page 145
Promissory Note“secured by col-lateral described in a security agreement this date.” Signed by debtor
Financing State-ment “all inventory and equipment of the debtor’s business” Not signed, but debtor signed authorization to file it
Cover Letter. “Enclosed are documents that give you a security interest in inventory and equipment,” signed by debtor’s lawyer
Are any of these an authenticated security agreement?
Do they meet the requirements of the composite document rule?
“Objectively indicate parties may have intended a SA”
“Parties actually intended a SA” page 141
Can we answer from the documents alone?
42
Problem 8.1, page 145
Promissory Note“secured by col-lateral described in a security agreement this date.” Signed by debtor
Financing State-ment “all inventory and equipment of the debtor’s business” Not signed, but debtor signed authorization to file it
Cover Letter. “Enclosed are documents that give you a security interest in inventory and equipment,” signed by debtor’s lawyer
Are any of these an authenticated security agreement?
Do they meet the requirements of the composite document rule?
“Objectively indicate parties may have intended a SA”
“Parties actually intended a SA” page 141
Can we answer from the documents alone?
43
Problem 8.1, page 145
Promissory Note“secured by col-lateral described in a security agreement this date.” Signed by debtor
Financing State-ment “all inventory and equipment of the debtor’s business” Not signed, but debtor signed authorization to file it
Cover Letter. “Enclosed are documents that give you a security interest in inventory and equipment,” signed by debtor’s lawyer
Are any of these an authenticated security agreement?
Do they meet the requirements of the composite document rule?
“Objectively indicate parties may have intended a SA”
“Parties actually intended a SA” page 141
Can we answer from the documents alone? Not second question
44
Problem 8.2, page 146
Fisherman’s Pier hypothetical. At what point in time did First National’s security interest attach?
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-201(44))
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
45
Problem 8.2, page 146
Fisherman’s Pier hypothetical. At what point in time did First National’s security interest attach?
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-201(44))
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
46
Problem 8.2, page 146
Fisherman’s Pier hypothetical. At what point in time did First National’s security interest attach?
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-204)
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
47
Problem 8.2, page 146
Fisherman’s Pier hypothetical. At what point in time did First National’s security interest attach?
§9-203(a) A security interest attaches to collateral when it becomes enforceable . . .
(b) [A] security interest is enforceable . . . only if:
(1) value has been given (§1-204)
(2) the debtor has rights in the collateral (§2-501(1)(a));
and
(3)(A) the debtor has authenticated a security agreementthat provides a description of the collateral . . .
First National’s security interest became enforceable when the last of these three requirements was satisfied.
48
Problem 8.3, page 146
The parties signed a security agreement that described the collateral as “The restaurant equipment described on the attached list.” No list is attached.
a. Does the bank have an enforceable security interest?
b. Two weeks later, the debtor’s lawyer mails the list to the secured party’s lawyer, and the secured party’s lawyer staples it to the security agreement. Is the agreement enforceable?
c. What if those events happened two years later?
d. What if those events happened after the debtor filed bankruptcy, 362(a)(4) and (5)
49
Problem 8.3, page 146
The parties signed a security agreement that described the collateral as “The restaurant equipment described on the attached list.” No list is attached.
a. Does the bank have an enforceable security interest?
b. Two weeks later, the debtor’s lawyer mails the list to the secured party’s lawyer, and the secured party’s lawyer staples it to the security agreement. Is the agreement enforceable?
c. What if those events happened two years later?
d. What if those events happened after the debtor filed bankruptcy, 362(a)(4) and (5)
50
Problem 8.3, page 146
The parties signed a security agreement that described the collateral as “The restaurant equipment described on the attached list.” No list is attached.
a. Does the bank have an enforceable security interest? No unless composite document available.
b. Two weeks later, the debtor’s lawyer mails the list to the secured party’s lawyer, and the secured party’s lawyer staples it to the security agreement. Is the agreement enforceable?
c. What if those events happened two years later?
d. What if those events happened after the debtor filed bankruptcy, 362(a)(4) and (5)
51
Problem 8.3, page 146
The parties signed a security agreement that described the collateral as “The restaurant equipment described on the attached list.” No list is attached.
a. Does the bank have an enforceable security interest?
b. Two weeks later, the debtor’s lawyer mails the list to the secured party’s lawyer, and the secured party’s lawyer staples it to the security agreement. Is the agreement enforceable? Split of authority.
c. What if those events happened two years later?
d. What if those events happened after the debtor filed bankruptcy, 362(a)(4) and (5)
52
Problem 8.3, page 146
The parties signed a security agreement that described the collateral as “The restaurant equipment described on the attached list.” No list is attached.
a. Does the bank have an enforceable security interest?
b. Two weeks later, the debtor’s lawyer mails the list to the secured party’s lawyer, and the secured party’s lawyer staples it to the security agreement. Is the agreement enforceable? Split of authority.
9-203(b)(3)(A) “. . . the debtor has authenticated a security agreement that provides a description of the collateral . . . ”
c. What if those events happened after the debtor filed ban
53
Problem 8.3, page 146
The parties signed a security agreement that described the collateral as “The restaurant equipment described on the attached list.” No list is attached.
a. Does the bank have an enforceable security interest?
b. Two weeks later, the debtor’s lawyer mails the list to the secured party’s lawyer, and the secured party’s lawyer staples it to the security agreement. Is the agreement enforceable? Split of authority.
c. What if those events happened two years after closing?
d. What if those events happened after the debtor filed bankruptcy, 362(a)(4) and (5)
54
Problem 8.3, page 146
The parties signed a security agreement that described the collateral as “The restaurant equipment described on the attached list.” No list is attached.
a. Does the bank have an enforceable security interest?
b. Two weeks later, the debtor’s lawyer mails the list to the secured party’s lawyer, and the secured party’s lawyer staples it to the security agreement. Is the agreement enforceable? Split of authority.
c. What if those events happened two years after closing?
d. What if those events happened after the debtor filed bankruptcy, 362(a)(4) and (5)
55
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
56
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
57
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
58
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
59
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
60
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
61
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
62
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
63
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? What are the options?
Whose bulldozer is this?
64
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? Client: “You fill in the blank.”
What are the options? Whose bulldozer is this?
65
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? Client: “You fill in the blank.” “No.”
What are the options? Whose bulldozer is this?
66
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
If we send it as is, what will happen? Staple description?
Whose decision is this? Client: “You fill in the blank.” “No.”
Client: I will fill in the blank. Will you maintain confidentiality?
67
Rule 1.6: Confidentiality of Information
(a) A lawyer shall not reveal information relating to the representation . . . unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation or the disclosure is permitted by paragraph (b).
(b) A lawyer may reveal [such] information . . . to the extent the lawyer reasonably believes necessary:
(1) to prevent reasonably certain death or substantial bodily harm;
(2) to prevent the client from committing a crime or fraud that is reasonably certain to result in substantial injury to the financial interests . . . of another and in furtherance of which the client has used or is using the lawyer's services;
(3) to prevent, mitigate or rectify [such an injury] . . .
(6) to comply with other law or a court order.
68
Rule 3.3 Candor Toward the Tribunal(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
(b) A lawyer who represents a client in an adjudicative proceeding and who knows that a person intends to engage, is engaging or has engaged in criminal or fraudulent conduct related to the proceeding shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal.
(c) Paragraphs (a) and (b) . . . apply even if compliance requires disclosure of information otherwise protected by Rule 1.6.
69
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
Right now, what are the options?
70
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
Right now, what are the options?
Morally and ethically, whose bulldozer is this?
71
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
Right now, what are the options?
Morally and ethically, whose bulldozer is this?
Who will be hurt by filling in the blank?
72
Problem 8.4, page 146
[Read from facts]
1. The debtor signed a security agreement that contained no description of collateral.
2. The debtor authorized us (the secured party’s lawyer) to fill in the description
3. We did not fill it in
4. The debtor filed bankruptcy
5. The trustee has requested a copy of the security agreement
Right now, what are the options?
Morally and ethically, whose bulldozer is this?
Who will be hurt by filling in the blank?
Vote
73
Problem 8.5, page 148
1. You withdrew from representation of Mestre
2. By accident, you are present when Mestre testifies:
a. Signature on the security agreement is his own.
b. The agreement was “genuine”
c. The document expressed the agreement between the parties
3. Mestre’s new lawyer offered the agreement in evidence and the court accepted it
What should you do now?
74
Problem 8.5, page 148
1. You withdrew from representation of Mestre
2. By accident, you are present when Mestre testifies:
a. Signature on the security agreement is his own.
b. The agreement was “genuine”
c. The document expressed the agreement between the parties
3. Mestre’s new lawyer offered the agreement in evidence and the court accepted it
What should you do now?
75
Problem 8.5, page 148
1. You withdrew from representation of Mestre
2. By accident, you are present when Mestre testifies:
a. Signature on the security agreement is his own.
b. The agreement was “genuine”
c. The document expressed the agreement between the parties
3. Mestre’s new lawyer offered the agreement in evidence and the court accepted it
What should you do now?
76
Problem 8.5, page 148
1. You withdrew from representation of Mestre
2. By accident, you are present when Mestre testifies:
a. Signature on the security agreement is his own.
b. The agreement was “genuine”
c. The document expressed the agreement between the parties
3. Mestre’s new lawyer offered the agreement in evidence and the court accepted it
What should you do now?
77
Problem 8.5, page 148
1. You withdrew from representation of Mestre
2. By accident, you are present when Mestre testifies:
a. Signature on the security agreement is his own.
b. The agreement was “genuine”
c. The document expressed the agreement between the parties
3. Mestre’s new lawyer offered the agreement in evidence and the court accepted it
What should you do now?
78
Problem 8.5, page 148
1. You withdrew from representation of Mestre
2. By accident, you are present when Mestre testifies:
a. Signature on the security agreement is his own.
b. The agreement was “genuine”
c. The document expressed the agreement between the parties
3. Mestre’s new lawyer offered the agreement in evidence and the court accepted it
What should you do now?
79
Problem 8.5, page 148
1. You withdrew from representation of Mestre
2. By accident, you are present when Mestre testifies:
a. Signature on the security agreement is his own.
b. The agreement was “genuine”
c. The document expressed the agreement between the parties
3. Mestre’s new lawyer offered the agreement in evidence and the court accepted it
What should you do now?
80
Rule 1.6: Confidentiality of Information
(a) A lawyer shall not reveal information relating to the representation . . . unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation or the disclosure is permitted by paragraph (b).
(b) A lawyer may reveal [such] information . . . to the extent the lawyer reasonably believes necessary:
(2) to prevent the client from committing a crime or fraud that is reasonably certain to result in substantial injury to the financial interests . . . of another and in furtherance of which the client has used or is using the lawyer's services;
81
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
(b) A lawyer who represents a client in an adjudicative proceeding and who knows that a person . . . has engaged in criminal or fraudulent conduct related to the proceeding shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal.
(c) Paragraphs (a) and (b) . . . apply even if compliance requires disclosure of information otherwise protected by Rule 1.6.
82
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
In re Ward, 894 F2d 771 (5th Cir. 1990): A lawyer has no duty in tort to bankruptcy court before which it has not appeared to inform court of an asset it "had reason to suspect" was not scheduled. "We can see situations in which some professional duty to the court may arise when a firm, even though not before the court, has actual knowledge that an outstanding asset of a bankrupt is being concealed." At 776.
83
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
Rule 1.9(c). A lawyer who has formerly represented a client . . . shall not . . . reveal information relating to the representation except as these Rules would permit or require with respect to a client.
84
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
"We can see situations in which some professional duty to the court may arise when a firm, even though not before the court, has actual knowledge that an outstanding asset of a bankrupt is being concealed." At 776.
85
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
In re Ward, 894 F2d 771 (5th Cir. 1990): A [law firm] has no duty in tort to bankruptcy court before which it has not appeared to inform court of an asset it "had reason to suspect" was not scheduled. "We can see situations in which some professional duty to the court may arise when a firm, even though not before the court, has actual knowledge that an outstanding asset of a bankrupt is being concealed." At 776.
86
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
In re Ward, 894 F2d 771 (5th Cir. 1990): A [law firm] has no duty in tort to bankruptcy court before which it has not appeared to inform court of an asset it "had reason to suspect" was not scheduled. "We can see situations in which some professional duty to the court may arise when a firm, even though not before the court, has actual knowledge that an outstanding asset of a bankrupt is being concealed." At 776.
87
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
In re Ward, 894 F2d 771 (5th Cir. 1990): A [law firm] has no duty in tort to bankruptcy court before which it has not appeared to inform court of an asset it "had reason to suspect" was not scheduled. "We can see situations in which some professional duty to the court may arise when a firm, even though not before the court, has actual knowledge that an outstanding asset of a bankrupt is being concealed." At 776.
Solution: control your own knowledge.
88
Rule 3.3 Candor Toward the Tribunal
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal. . .
(3) If a . . . lawyer's client . . . has offered material evidence and the lawyer comes to know of its falsity, the lawyer shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal . . . .
In re Ward, 894 F2d 771 (5th Cir. 1990): A [law firm] has no duty in tort to bankruptcy court before which it has not appeared to inform court of an asset it "had reason to suspect" was not scheduled. "We can see situations in which some professional duty to the court may arise when a firm, even though not before the court, has actual knowledge that an outstanding asset of a bankrupt is being concealed." At 776.
Solution: control your own knowledge. Is this ethics?
89
Systems observations
§9-203(b)(3)(A) requires an authenticated security agreement to prevent fraud by the secured creditor.
Article 9 does not require the secured creditor to publicly file the security agreement; the secured creditor can keep it in a private file
Article 9 requires the secured creditor to file a financing statement. A financing statement rarely qualifies as a security agreement.
Fraud is easy.
How does the real estate system deal with this problem?
90
Systems observations
§9-203(b)(3)(A) requires an authenticated security agreement to prevent fraud by the secured creditor.
Article 9 lets the secured creditor keep it in a private file
Article 9 requires the secured creditor to file a financing statement. A financing statement rarely qualifies as a security agreement.
Fraud is easy.
How does the real estate system deal with this problem?
91
Systems observations
§9-203(b)(3)(A) requires an authenticated security agreement to prevent fraud by the secured creditor.
Article 9 lets the secured creditor keep it in a private file
Article 9 requires a public filing, but not of the security agreement.
Fraud is easy.
How does the real estate system deal with this problem?
92
Systems observations
§9-203(b)(3)(A) requires an authenticated security agreement to prevent fraud by the secured creditor.
Article 9 lets the secured creditor keep it in a private file
Article 9 requires a public filing, but not of the security agreement.
Security agreement fraud is easy. Common problem.
How does the real estate system deal with this problem?
93
Systems observations
§9-203(b)(3)(A) requires an authenticated security agreement to prevent fraud by the secured creditor.
Article 9 lets the secured creditor keep it in a private file
Article 9 requires a public filing, but not of the security agreement.
Security agreement fraud is easy. Common problem.
How does the real estate system deal with this problem?
94
Systems observations
§9-203(b)(3)(A) requires an authenticated security agreement to prevent fraud by the secured creditor.
Article 9 lets the secured creditor keep it in a private file
Article 9 requires a public filing, but not of the security agreement.
Security agreement fraud is easy. Common problem.
How does the real estate system deal with this problem?
Can mortgagees “fix” their mortgages when trouble arises?
top related