Article 9 — Secured Transactions · Section 9-109
Explore the scope and applicability of Article 9 of the Uniform Commercial Code, focusing on secured transactions.
Source: U.C.C. § 9-109
Section 9-109. (a) Except as otherwise provided in this section, this article applies to a transaction, regardless of its form, that creates a security interest in personal property or fixtures by contract, and also applies to a sale of accounts, chattel paper, payment intangibles, or promissory notes. (b) This article does not apply to: (1) a statutory lien; (2) a wage assignment or a payroll deduction; (3) a transfer of grading interests in goods; (4) a sale of accounts or chattel paper; (5) a transmission by a government unit; or (6) a security interest created in the context of a consumer transaction.
UCC § 9-109 establishes the scope of Article 9, which governs secured transactions involving personal property. It details what types of transactions are covered and specifies certain exclusions to its applicability.
An interest in personal or real property that secures payment or performance of an obligation.
The property subject to a security interest.
Example 1
A bank provides a loan to a business and takes a security interest in the business's inventory as collateral.
Example 2
A mechanic retains a lien on a car for unpaid repairs, which falls under the exceptions in UCC § 9-109.