#1
Which legal document creates a security interest in personal property?
Security agreement
ExplanationSecurity agreement creates a legal interest in personal property.
#2
What does 'UCC' stand for in the context of secured transactions?
Uniform Commercial Code
Explanation'UCC' stands for Uniform Commercial Code in secured transactions.
#3
What is the purpose of a 'security interest' in commercial law?
To secure repayment of a debt with specific property
ExplanationThe purpose of a security interest in commercial law is to secure repayment of a debt with specific property.
#4
In a secured transaction, what is the role of the 'debtor'?
To grant a security interest in the collateral to the secured party
ExplanationThe role of the debtor in a secured transaction is to grant a security interest in the collateral to the secured party.
#5
Which party has priority in a secured transaction?
Secured party
ExplanationThe secured party holds priority in a secured transaction.
#6
Under the UCC, what is the primary method for perfecting a security interest?
Filing a financing statement
ExplanationFiling a financing statement is the primary method for perfecting a security interest under the UCC.
#7
What is the concept of a 'purchase money security interest' (PMSI) in secured transactions?
A security interest created to secure the purchase price of collateral
ExplanationA PMSI is a security interest created to secure the purchase price of collateral.
#8
What is the 'floating lien' in the context of secured transactions?
A lien that covers after-acquired property of the debtor
ExplanationA floating lien covers after-acquired property of the debtor in secured transactions.
#9
Which of the following is NOT a requirement for a security interest to attach to collateral?
Attachment must be noted in public records
ExplanationNoting attachment in public records is NOT a requirement for a security interest to attach to collateral.
#10
What is the 'super-priority rule' in secured transactions?
A rule that gives priority to certain types of creditors over others
ExplanationThe super-priority rule gives priority to certain types of creditors over others in secured transactions.
#11
What is the difference between attachment and perfection of a security interest?
Attachment creates the security interest, while perfection gives priority over other creditors.
ExplanationAttachment creates the security interest, while perfection establishes priority over other creditors.
#12
What does 'perfection by possession' mean in secured transactions?
The secured party physically holds the collateral
ExplanationPerfection by possession means the secured party physically holds the collateral.
#13
What is the effect of perfection on a security interest?
Perfection makes the security interest enforceable against third parties and establishes priority.
ExplanationPerfection makes the security interest enforceable against third parties and establishes priority.
#14
What does 'replevin' refer to in the context of secured transactions?
The process of recovering collateral from a debtor who has defaulted
ExplanationReplevin refers to the process of recovering collateral from a debtor who has defaulted in secured transactions.