BILL ANALYSIS �
AB 2667
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Date of Hearing: April 16, 2012
ASSEMBLY COMMITTEE ON BANKING AND FINANCE
Mike Eng, Chair
AB 2667 (Banking & Finance) - As Introduced: March 5, 2012
SUBJECT : Personal property: fraudulent transfers.
SUMMARY : Allows a transferor to file a financing statement,
authorized in an authenticated record, with respect to the
property transferred.
EXISTING LAW
1)Provides that a transfer of personal property not accompanied
by delivery and change of possession is void against the
transferor's creditors. �Civil Code, Section 3440]
2)Exempts certain types of transfers from the general rule,
Civil Code 3440. One such exempted transfer, under
subdivision (h) of Section 3440.1 of the Civil Code, is where
a transferor or transferee files a financing statement with
the office of the Secretary of State in accordance with
Chapter 5 (commencing with Section 9501) of Division 9 of the
Commercial Code and publishes notice of the intended transfer
at least 10 days before the date the transfer occurs. �Civil
Code, Section 3440.1]
3)Requires the transferor to sign the financing statement.
�Civil Code, Section 3440.1]
4)Defines "authenticate" as either of the following: To sign or
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. �Commercial Code,
Section 9102]
5)Defines "record" except as used in "for record", "record or
legal title" and "record owner" 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. �Commercial Code, Section 9102]
FISCAL EFFECT : None.
AB 2667
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COMMENTS :
AB 2667, sponsored by the UCC Committee of the California State
Bar, amends subdivision (h) of Section 3440.1 of the Civil Code
to eliminate the requirement that a financing statement be
signed by the transferor, and instead require that the
transferor authorize the filing in an "authenticated record."
This technical change is necessary to conform Section 3440.1(h)
of the Civil Code to Division 9 of the Commercial Code, which
eliminated, under the 2001 amendments, the requirement that a
financing statement be signed. Under Sections 9502(a) and
9509(a) of the Commercial Code, records filed with the office of
the Secretary of State do not require signatures for their
effectiveness. Instead, a person is entitled to file a
financing statement if the debtor "authorizes the filing in an
authenticated record."
The UCC Committee of the California State Bar noted, "in
Official Comment 3 to Section 9-502 of the UCC, "�t]he
elimination of the signature requirement facilitates paperless
filing." As a result of this change to the UCC, the form of
National UCC Financing Statement (Form UCC1), available on the
California Secretary of State website was revised so there is no
longer a signature line for the debtor. Since the UCC financing
statement form no longer provides a signature line for the
debtor/transferor, parties need to manually add a signature
block for the transferor to comply with Civil Code Section
3440.1(h)(1)."
This proposal would simply amend Civil Code Section 3440.1(h)
(1) to track Division 9 of the Commercial Code so that the
transferor or transferee could file a financing statement with
the California Secretary of State without a physical signature,
as long as the transferor authorized the filing in an
authenticated record.
REGISTERED SUPPORT / OPPOSITION :
Support
The State Bar of California (Sponsor)
Opposition
AB 2667
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None on file.
Analysis Prepared by : Kathleen O'Malley / B. & F. / (916)
319-3081