AB 1858, as amended, Perea. Commercial law: secured transactions.
The Uniform Commercial Code - Secured Transactions governs security interests in collateral, including personal property and fixtures, as well as certain sales of accounts, contract rights, and chattel paper. That code, among other things, specifies requirements and procedures regarding perfecting a security interest, including the filing of a financing statement with the Secretary of State. Existing law specifies that a financing statement sufficiently provides the name of a debtor, where the debtor is an individual, if it provides the individual name of the debtor or the surname and first personal name of the debtor.
This bill would revise the manner in which a financing statement sufficiently provides the name of the debtor, where that debtor is an individual, to provide that, where the Department of Motor Vehicles has issued a driver’s license that has not expired or identification card that has not expired to the individual, the statement sufficiently provides the name of the debtor only if the statement provides the name of the individual indicated on the license or card and, if the individual has not been issued a driver’s license or identification card, the statement sufficiently provides the name of the debtor if it provides the individual name of the debtor or the surname and first personal name of the debtor.
begin insertExisting provisions of the Unruh Civil Rights Act, with certain exceptions, prohibit various forms of arbitrary discrimination by business establishments.
end insertbegin insertThis bill would make it a violation of the Unruh Civil Rights Act for a secured party or proposed secured party to decline to provide credit to a debtor or proposed debtor, or offer to make the terms and conditions of such credit less favorable to the debtor or proposed debtor, because the debtor or proposed debtor does not hold or present a valid driver’s license or identification card issued by the Department of Motor Vehicles, as provided.
end insertVote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 9503 of the Commercial Code, as
2amended by Section 16 of Chapter 531 of the Statutes of 2013, is
3amended to read:
(a) A financing statement sufficiently provides the name
5of the debtor only if it does so in accordance with the following
6rules:
7(1) Except as otherwise provided in paragraph (3), if the debtor
8is a registered organization or the collateral is held in a trust that
9is a registered organization, only if the financing statement provides
10the name that is stated to be the registered organization’s name on
11the public organic record most recently filed with or issued or
12enacted by the registered organization’s jurisdiction of organization
13which purports to state, amend, or restate the registered
14organization’s name.
15(2) Subject to
subdivision (f), if the collateral is being
16administered by the personal representative of a decedent, only if
17the financing statement provides, as the name of the debtor, the
18name of the decedent and, in a separate part of the financing
19statement, indicates that the collateral is being administered by a
20personal representative.
21(3) If the collateral is held in a trust that is not a registered
22organization, only if the financing statement satisfies both of the
23following conditions:
24(A) Provides, as the name of the debtor, either of the following:
P3 1(i) If the organic record of the trust specifies a name for the
2trust, the name specified.
3(ii) If the organic
record of the trust does not specify a name
4for the trust, the name of the settlor or testator.
5(B) In a separate part of the financing statement, the following
6information is provided, as applicable:
7(i) If the name is provided in accordance with clause (i) of
8subparagraph (A), the financing statement indicates that the
9collateral is held in a trust.
10(ii) If the name is provided in accordance with clause (ii) of
11subparagraph (A), the financing statement provides additional
12information sufficient to distinguish the trust from other trusts
13having one or more of the same settlors or the same testator and
14indicates that the collateral is held in a trust, unless the additional
15information so indicates.
16(4) Subject to subdivision (g), if the debtor is an individual to
17whom the Department of Motor Vehicles has issued a driver’s
18license that has not expired or an identification card that has not
19expired, only if the financing statement provides the name of the
20individual indicated on that driver’s license or identification card.
21(5) If debtor is an individual to whom paragraph (4) does not
22apply, only if the financing statement provides the individual name
23of the debtor or the surname and first personal name of the debtor.
24(6) In other cases, according to the following rules:
25(A) If the debtor has a name, only if the financing statement
26provides the organizational name
of the debtor.
27(B) If the debtor does not have a name, only if the financing
28statement provides the names of the partners, members, associates,
29or other persons comprising the debtor, in a manner that each name
30provided would be sufficient if the person named were the debtor.
31(b) A financing statement that provides the name of the debtor
32in accordance with subdivision (a) is not rendered ineffective by
33the absence of either of the following:
34(1) A trade name or other name of the debtor.
35(2) Unless required under subparagraph (B) of paragraph (6) of
36subdivision (a), names of partners, members, associates, or other
37persons comprising the debtor.
38(c) A financing statement that provides only the debtor’s trade
39name does not sufficiently provide the name of the debtor.
P4 1(d) Failure to indicate the representative capacity of a secured
2party or representative of a secured party does not affect the
3sufficiency of a financing statement.
4(e) A financing statement may provide the name of more than
5one debtor and the name of more than one secured party.
6(f) The name of the decedent indicated on the order appointing
7the personal representative of the decedent issued by the court
8having jurisdiction over the collateral is sufficient as the “name
9of the decedent” under paragraph (2) of subdivision (a).
10(g) If the Department of Motor Vehicles has issued to an
11individual more than one driver’s licenses or identification cards
12of a kind described in paragraph (4) of subdivision (a), paragraph
13(4) of subdivision (a) refers to the most recently issued license or
14card.
15(h) For purposes of this section:
16(1) “Driver’s license” includes a driver’s license issued pursuant
17to subdivision (a) of Section 12801.9 of the Vehicle Code.
18(2) “Name of the settlor or testator” means either of the
19following:
20(A) If the settlor is a registered organization, the name that is
21stated to be the settlor’s name on the public
organic record most
22recently filed with or issued or enacted by the settlor’s jurisdiction
23of organization which purports to state, amend, or restate the
24settlor’s name.
25(B) In other cases, the name of the settlor or testator indicated
26in the trust’s organic record.
begin insertSection 9503.5 is added to the end insertbegin insertCommercial Codeend insertbegin insert, to
28read:end insert
Section 51 of the Civil Code shall be construed to
30prohibit a secured party or proposed secured party from declining
31to provide credit to a debtor or proposed debtor, or offer to make
32the terms and conditions of such credit less favorable to the debtor
33or proposed debtor, because the debtor or proposed debtor does
34not hold or present a valid driver’s license or identification card
35issued by the Department of Motor Vehicles. All elements of a
36claim under Section 51 of the Civil Code and any affirmative
37defenses available under Section 51 of the Civil Code apply to a
38claim under this section.
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