OREGON LAWS 2012 Chap. 12 · OREGON LAWS 2012 Chap. 12 (B) Indicates that it is a continuation statement for, or that it is filed to continue the effectiveness of, the identified

OREGON LAWS 2012 Chap. 12

CHAPTER 12

AN ACT HB 4035

Relating to secured transactions in personal prop-erty; creating new provisions; amending ORS79.0102, 79.0105, 79.0208, 79.0307, 79.0311, 79.0316,79.0317, 79.0326, 79.0335, 79.0406, 79.0408, 79.0503,79.0507, 79.0515, 79.0516, 79.0518, 79.0521, 79.0607,79.0619, 803.030 and 803.097; and declaring anemergency.

Be It Enacted by the People of the State of Or-egon:

SECTION 1. ORS 79.0102 is amended to read:79.0102. UCC 9-102. Definitions and index of

definitions. (1) As used in this chapter:(a) “Accession” means goods that are physically

united with other goods in such a manner that theidentity of the original goods is not lost.

(b) “Account,” except as used in “account for”:(A) Means a right to payment of a monetary ob-

ligation, whether or not earned by performance:(i) For property that has been or is to be sold,

leased, licensed, assigned, or otherwise disposed of;(ii) For services rendered or to be rendered;(iii) For a policy of insurance issued or to be is-

sued;(iv) For a secondary obligation incurred or to be

incurred;(v) For energy provided or to be provided;(vi) For the use or hire of a vessel under a

charter or other contract;(vii) Arising out of the use of a credit or charge

card or information contained on or for use with thecard; or

(viii) As winnings in a lottery or other game ofchance operated or sponsored by a state, govern-mental unit of a state, or person licensed or author-ized to operate the game by a state or governmentalunit of a state. The term includes health-care-insurance receivables.

(B) Does not include:(i) Rights to payment evidenced by chattel paper

or an instrument;(ii) Commercial tort claims;(iii) Deposit accounts;(iv) Investment property;(v) Letter-of-credit rights or letters of credit; or(vi) Rights to payment for money or funds ad-

vanced or sold, other than rights arising out of theuse of a credit or charge card or information con-tained on or for use with the card.

(c)(A) “Account debtor” means a person obli-gated on an account, chattel paper or general intan-gible.

(B) The term does not include persons obligatedto pay a negotiable instrument, even if the instru-ment constitutes part of chattel paper.

(d) “Accounting,” except as used in “accountingfor,” means a record:

(A) Authenticated by a secured party;

(B) Indicating the aggregate unpaid secured ob-ligations as of a date not more than 35 days earlieror 35 days later than the date of the record; and

(C) Identifying the components of the obligationsin reasonable detail.

(e) “Agricultural lien” means an interest, otherthan a security interest or a lien created under ORS87.226, 87.228, 87.700 to 87.736 or 87.750 to 87.777, infarm products:

(A) Which secures payment or performance of anobligation for:

(i) Goods or services furnished in connectionwith a debtor’s farming operation; or

(ii) Rent on real property leased by a debtor inconnection with its farming operation;

(B) Which is created by statute in favor of aperson that:

(i) In the ordinary course of its business fur-nished goods or services to a debtor in connectionwith a debtor’s farming operation; or

(ii) Leased real property to a debtor in con-nection with the debtor’s farming operation; and

(C) Whose effectiveness does not depend on theperson’s possession of the personal property.

(f) “As-extracted collateral” means:(A) Oil, gas or other minerals that are subject to

a security interest that:(i) Is created by a debtor having an interest in

the minerals before extraction; and(ii) Attaches to the minerals as extracted; or(B) Accounts arising out of the sale at the

wellhead or minehead of oil, gas or other mineralsin which the debtor had an interest before ex-traction.

(g) “Authenticate” means:(A) To sign; or(B) [To execute or otherwise adopt a symbol, or

encrypt or similarly process a record in whole or inpart, with the present intent of the authenticatingperson to identify the person and adopt or accept arecord.] With present intent to adopt or accept arecord, to attach to or logically associate withthe record an electronic sound, symbol or proc-ess.

(h) “Bank” means an organization that is en-gaged in the business of banking. The term includessavings banks, savings and loan associations, creditunions and trust companies.

(i) “Cash proceeds” means proceeds that aremoney, checks, deposit accounts or the like.

(j) “Certificate of title” means a certificate of ti-tle with respect to which a statute provides for thesecurity interest in question to be indicated on thecertificate as a condition or result of the securityinterest’s obtaining priority over the rights of a liencreditor with respect to the collateral. “Certificateof title” includes another record maintained asan alternative to the certificate of title by thegovernmental unit that issues certificates of ti-tle if a statute permits the security interest inquestion to be indicated on the record as a con-dition or result of the security interest’s ob-

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Chap. 12 OREGON LAWS 2012

taining priority over the rights of the liencreditor with respect to the collateral.

(k)(A) “Chattel paper” means a record or recordsthat evidence both a monetary obligation and a se-curity interest in specific goods, a security interestin specific goods and software used in the goods, asecurity interest in specific goods and license ofsoftware used in the goods, a lease of specific goods,or a lease of specific goods and license of softwareused in the goods. In this paragraph, “monetary ob-ligation” means a monetary obligation secured bythe goods or owed under a lease of the goods andincludes a monetary obligation with respect to soft-ware used in the goods.

(B) The term does not include:(i) Charters or other contracts involving the use

or hire of a vessel; or(ii) Records that evidence a right to payment

arising out of the use of a credit or charge card orinformation contained on or for use with the card.If a transaction is evidenced by records that includean instrument or series of instruments, the group ofrecords taken together constitutes chattel paper.

(L) “Collateral” means the property subject to asecurity interest or agricultural lien. The term in-cludes:

(A) Proceeds to which a security interest at-taches;

(B) Accounts, chattel paper, payment intangiblesand promissory notes that have been sold; and

(C) Goods that are the subject of a consignment.(m) “Commercial tort claim” means a claim

arising in tort with respect to which:(A) The claimant is an organization; or(B) The claimant is an individual and the claim:(i) Arose in the course of the claimant’s business

or profession; and(ii) Does not include damages arising out of per-

sonal injury to or the death of an individual.(n) “Commodity account” means an account

maintained by a commodity intermediary in which acommodity contract is carried for a commodity cus-tomer.

(o) “Commodity contract” means a commodityfutures contract, an option on a commodity futurescontract, a commodity option or another contract ifthe contract or option is:

(A) Traded on or subject to the rules of a boardof trade that has been designated as a contractmarket for such a contract pursuant to federal com-modities laws; or

(B) Traded on a foreign commodity board oftrade, exchange, or market, and is carried on thebooks of a commodity intermediary for a commoditycustomer.

(p) “Commodity customer” means a person forwhich a commodity intermediary carries a commod-ity contract on its books.

(q) “Commodity intermediary” means a personthat:

(A) Is registered as a futures commission mer-chant under federal commodities law; or

(B) In the ordinary course of its business pro-vides clearance or settlement services for a board oftrade that has been designated as a contract marketpursuant to federal commodities law.

(r) “Communicate” means:(A) To send a written or other tangible record;(B) To transmit a record by any means agreed

upon by the persons sending and receiving the re-cord; or

(C) In the case of transmission of a record to orby a filing office, to transmit a record by any meansprescribed by filing-office rule.

(s) “Consignee” means a merchant to whichgoods are delivered in a consignment.

(t) “Consignment” means a transaction, regard-less of its form, in which a person delivers goods toa merchant for the purpose of sale and:

(A) The merchant:(i) Deals in goods of that kind under a name

other than the name of the person making delivery;(ii) Is not an auctioneer; and(iii) Is not generally known by its creditors to

be substantially engaged in selling the goods of oth-ers;

(B) With respect to each delivery, the aggregatevalue of the goods is $1,000 or more at the time ofdelivery;

(C) The goods are not consumer goods imme-diately before delivery; and

(D) The transaction does not create a securityinterest that secures an obligation.

(u) “Consignor” means a person that deliversgoods to a consignee in a consignment.

(v) “Consumer debtor” means a debtor in a con-sumer transaction.

(w) “Consumer goods” means goods that are usedor bought for use primarily for personal, family orhousehold purposes.

(x) “Consumer-goods transaction” means a con-sumer transaction in which:

(A) An individual incurs an obligation primarilyfor personal, family or household purposes; and

(B) A security interest in consumer goods se-cures the obligation.

(y) “Consumer obligor” means an obligor who isan individual and who incurred the obligation aspart of a transaction entered into primarily for per-sonal, family or household purposes.

(z)(A) “Consumer transaction” means a trans-action in which:

(i) An individual incurs an obligation primarilyfor personal, family or household purposes;

(ii) A security interest secures the obligation;and

(iii) The collateral is held or acquired primarilyfor personal, family or household purposes.

(B) The term includes consumer-goods trans-actions.

(aa) “Continuation statement” means an amend-ment of a financing statement which:

(A) Identifies, by its file number, the initial fi-nancing statement to which it relates; and

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(B) Indicates that it is a continuation statementfor, or that it is filed to continue the effectivenessof, the identified financing statement.

(bb) “Debtor” means:(A) A person having an interest, other than a

security interest or other lien, in the collateral,whether or not the person is an obligor;

(B) A seller of accounts, chattel paper, paymentintangibles or promissory notes; or

(C) A consignee.(cc)(A) “Deposit account” means a demand, time,

savings, passbook or similar account maintainedwith a bank.

(B) The term does not include investment prop-erty or accounts evidenced by an instrument.

(dd) “Document” means a document of title or areceipt of the type described in ORS 77.2010 (2).

(ee) “Electronic chattel paper” means chattelpaper evidenced by a record or records consisting ofinformation stored in an electronic medium.

(ff) “Encumbrance” means a right, other than anownership interest, in real property. The term in-cludes mortgages and other liens on real property.

(gg) “Equipment” means goods other than inven-tory, farm products or consumer goods.

(hh) “Farm products” means goods, other thanstanding timber, with respect to which the debtor isengaged in a farming operation and which are:

(A) Crops grown, growing, or to be grown, in-cluding:

(i) Crops produced on trees, vines and bushes;and

(ii) Aquatic goods produced in aquacultural op-erations;

(B) Livestock, born or unborn, including aquaticgoods produced in aquacultural operations;

(C) Supplies used or produced in a farming oper-ation; or

(D) Products of crops or livestock in their un-manufactured states.

(ii) “Farming operation” means raising, cultivat-ing, propagating, fattening, grazing or any otherfarming, livestock or aquacultural operation.

(jj) “File number” means the number assigned toan initial financing statement pursuant to ORS79.0519 (1).

(kk) “Filing office” means an office designated inORS 79.0501 as the place to file a financing state-ment.

(LL) “Filing-office rule” means a rule adoptedpursuant to ORS 79.0526.

(mm) “Financing statement” means a record orrecords composed of an initial financing statementand any filed record relating to the initial financingstatement.

(nn) “Fixture filing” means the filing of a fi-nancing statement covering goods that are or are tobecome fixtures and satisfying ORS 79.0502 (1) and(2). The term includes the filing of a financingstatement covering goods of a transmitting utilitywhich are or are to become fixtures.

(oo)(A) “Fixtures” means goods that have becomeso related to particular real property that an inter-est in them arises under real property law.

(B) The term does not include portable irrigationequipment including movable pipe, pumps, electricalpump panels, pump columns, electrical wire, wheellines, center pivots and handlines.

(C) The term includes domestic pumps, domesticpump wire, domestic pump panels, domestic pumpcolumns and buried irrigation equipment includingburied pipe, buried electrical wire and all buriedwell casings.

(pp) “General intangible” means any personalproperty, including things in action, other than ac-counts, chattel paper, commercial tort claims, de-posit accounts, documents, goods, instruments,investment property, letter-of-credit rights, letters ofcredit, money and oil, gas or other minerals beforeextraction. The term includes payment intangiblesand software.

(qq)(A) “Goods” means all things that are mova-ble when a security interest attaches.

(B) The term includes:(i) Fixtures;(ii) Standing timber that is to be cut and re-

moved under a conveyance or contract for sale;(iii) The unborn young of animals;(iv) Crops grown, growing or to be grown, even

if the crops are produced on trees, vines or bushes;and

(v) Manufactured structures.(C) The term also includes a computer program

embedded in goods and any supporting informationprovided in connection with a transaction relatingto the program if:

(i) The program is associated with the goods insuch a manner that it customarily is considered partof the goods; or

(ii) By becoming the owner of the goods, a per-son acquires a right to use the program in con-nection with the goods.

(D) The term does not include a computer pro-gram embedded in goods that consist solely of themedium in which the program is embedded. Theterm also does not include accounts, chattel paper,commercial tort claims, deposit accounts, documents,general intangibles, instruments, investment prop-erty, letter-of-credit rights, letters of credit, moneyor oil, gas or other minerals before extraction.

(rr) “Governmental unit” means a subdivision,agency, department, county, parish, municipality orother unit of the government of the United States,a state or a foreign country. The term includes anorganization having a separate corporate existenceif the organization is eligible to issue debt on whichinterest is exempt from income taxation under thelaws of the United States.

(ss) “Health-care-insurance receivable” means aninterest in or claim under a policy of insurancewhich is a right to payment of a monetary obligationfor health-care goods or services provided.

(tt)(A) “Instrument” means a negotiable instru-ment or any other writing that evidences a right to

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the payment of a monetary obligation, is not itself asecurity agreement or lease, and is of a type that inordinary course of business is transferred by deliverywith any necessary indorsement or assignment.

(B) The term does not include:(i) Investment property;(ii) Letters of credit; or(iii) Writings that evidence a right to payment

arising out of the use of a credit or charge card orinformation contained on or for use with the card.

(uu) “Inventory” means goods, other than farmproducts, which:

(A) Are leased by a person as lessor;(B) Are held by a person for sale or lease or to

be furnished under a contract of service;(C) Are furnished by a person under a contract

of service; or(D) Consist of raw materials, work in process, or

materials used or consumed in a business.(vv) “Investment property” means a security,

whether certificated or uncertificated, securityentitlement, securities account, commodity contractor commodity account.

(ww) “Jurisdiction of organization,” with respectto a registered organization, means the jurisdictionunder whose law the organization is organized.

(xx)(A) “Letter-of-credit right” means a right topayment or performance under a letter of credit,whether or not the beneficiary has demanded or isat the time entitled to demand payment or perform-ance.

(B) The term does not include the right of abeneficiary to demand payment or performance un-der a letter of credit.

(yy) “Lien creditor” means:(A) A creditor that has acquired a lien on the

property involved by attachment, levy or the like;(B) An assignee for benefit of creditors from the

time of assignment;(C) A trustee in bankruptcy from the date of the

filing of the petition; or(D) A receiver in equity from the time of ap-

pointment.(zz) “Manufactured structure” has the meaning

given that term in ORS 446.561. (aaa) “Manufactured-structure transaction”means a secured transaction:

(A) That creates a purchase-money security in-terest in a manufactured structure, other than amanufactured structure held as inventory; or

(B) In which a manufactured structure, otherthan a manufactured structure held as inventory, isthe primary collateral.

(bbb) “Mortgage” means a consensual interest inreal property, including fixtures, which secures pay-ment or performance of an obligation.

(ccc) “New debtor” means a person that becomesbound as debtor under ORS 79.0203 (4) by a securityagreement previously entered into by another per-son.

(ddd)(A) “New value” means:(i) Money;

(ii) Money’s worth in property, services or newcredit; or

(iii) Release by a transferee of an interest inproperty previously transferred to the transferee.

(B) The term does not include an obligation sub-stituted for another obligation.

(eee) “Noncash proceeds” means proceeds otherthan cash proceeds.

(fff)(A) “Obligor” means a person that, with re-spect to an obligation secured by a security interestin or an agricultural lien on the collateral:

(i) Owes payment or other performance of theobligation;

(ii) Has provided property other than the collat-eral to secure payment or other performance of theobligation; or

(iii) Is otherwise accountable in whole or in partfor payment or other performance of the obligation.

(B) The term does not include issuers or nomi-nated persons under a letter of credit.

(ggg) “Original debtor,” except as used in ORS79.0310 (3), means a person that, as debtor, enteredinto a security agreement to which a new debtor hasbecome bound under ORS 79.0203 (4).

(hhh) “Payment intangible” means a general in-tangible under which the account debtor’s principalobligation is a monetary obligation.

(iii) “Person related to,” with respect to an indi-vidual, means:

(A) The spouse of the individual;(B) A brother, brother-in-law, sister or sister-in-

law of the individual;(C) An ancestor or lineal descendant of the indi-

vidual or the individual’s spouse; or(D) Any other relative, by blood or marriage, of

the individual or the individual’s spouse who sharesthe same home with the individual.

(jjj) “Person related to,” with respect to an or-ganization, means:

(A) A person directly or indirectly controlling,controlled by, or under common control with theorganization;

(B) An officer or director of, or a person per-forming similar functions with respect to, the or-ganization;

(C) An officer or director of, or a person per-forming similar functions with respect to, a persondescribed in subparagraph (A) of this paragraph;

(D) The spouse of an individual described insubparagraph (A), (B) or (C) of this paragraph; or

(E) An individual who is related by blood ormarriage to an individual described in subparagraph(A), (B), (C) or (D) of this paragraph and shares thesame home with the individual.

(kkk) “Proceeds,” except as used in ORS 79.0609(2), means the following property:

(A) Whatever is acquired upon the sale, lease,license, exchange or other disposition of collateral;

(B) Whatever is collected on, or distributed onaccount of, collateral;

(C) Rights arising out of collateral;(D) To the extent of the value of collateral,

claims arising out of the loss, nonconformity or in-

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terference with the use of, defects or infringementof rights in, or damage to, the collateral; or

(E) To the extent of the value of collateral andto the extent payable to the debtor or the securedparty, insurance payable by reason of the loss ornonconformity of, defects or infringement of rightsin, or damage to, the collateral.

(LLL) “Promissory note” means an instrumentthat evidences a promise to pay a monetary obli-gation, does not evidence an order to pay, and doesnot contain an acknowledgment by a bank that thebank has received for deposit a sum of money orfunds.

(mmm) “Proposal” means a record authenticatedby a secured party which includes the terms onwhich the secured party is willing to accept collat-eral in full or partial satisfaction of the obligationit secures pursuant to ORS 79.0620, 79.0621 and79.0622.

(nnn) “Public-finance transaction” means a se-cured transaction in connection with which:

(A) Debt securities are issued;(B) All or a portion of the securities issued have

an initial stated maturity of at least 20 years; and(C) The debtor, obligor, secured party, account

debtor or other person obligated on collateral,assignor or assignee of a secured obligation, orassignor or assignee of a security interest is a stateor a governmental unit of a state.

(ooo) “Public organic record” means a recordthat is available to the public for inspection andis:

(A) A record consisting of the record initiallyfiled with or issued by a state or the UnitedStates to form or organize an organization andany record filed with or issued by the state orthe United States that amends or restates theinitial record;

(B) An organic record of a business trustconsisting of the record initially filed with astate and any record filed with the state thatamends or restates the initial record, if a stat-ute of the state governing business trusts re-quires that the record be filed with the state; or

(C) A record consisting of legislation enactedby the legislature of a state or the Congress ofthe United States that forms or organizes anorganization, any record amending the legis-lation and any record filed with or issued by thestate or the United States that amends or re-states the name of the organization.

[(ooo)] (ppp) “Pursuant to commitment,” withrespect to an advance made or other value given bya secured party, means pursuant to the securedparty’s obligation, whether or not a subsequentevent of default or other event not within the se-cured party’s control has relieved or may relieve thesecured party from its obligation.

[(ppp)] (qqq) “Record,” except as used in “forrecord,” “of record,” “record or legal title” and “re-cord owner,” means information that is inscribed ona tangible medium or which is stored in an elec-

tronic or other medium and is retrievable inperceivable form.

[(qqq)] (rrr) “Registered organization” means anorganization formed or organized solely under thelaw of a single state or the United States [and as towhich the state or the United States is required bystatute or regulation to maintain a public recordshowing the organization to have been organized.] bythe filing of a public organic record with, theissuance of a public organic record by or theenactment of legislation by the state or theUnited States. “Registered organization” in-cludes a business trust that is formed or organ-ized under the law of a single state if a statuteof the state governing business trusts requiresthat the business trust’s organic record be filedwith the state.

[(rrr)] (sss) “Secondary obligor” means anobligor to the extent that:

(A) The obligor’s obligation is secondary; or(B) The obligor has a right of recourse with re-

spect to an obligation secured by collateral againstthe debtor, another obligor, or property of either.

[(sss)] (ttt) “Secured party” means:(A) A person in whose favor a security interest

is created or provided for under a security agree-ment, whether or not any obligation to be securedis outstanding;

(B) A person that holds an agricultural lien;(C) A consignor;(D) A person to which accounts, chattel paper,

payment intangibles or promissory notes have beensold;

(E) A trustee, indenture trustee, agent, collateralagent or other representative in whose favor a se-curity interest or agricultural lien is created or pro-vided for; or

(F) A person that holds a security interest aris-ing under ORS 72.4010, 72.5050, 72.7110 (3), 72A.5080(5), 74.2100 or 75.1180.

[(ttt)] (uuu) “Security agreement” means anagreement that creates or provides for a securityinterest.

[(uuu)] (vvv) “Send,” in connection with a re-cord or notification, means:

(A) To deposit in the mail, deliver for trans-mission, or transmit by any other usual means ofcommunication, with postage or cost of transmissionprovided for, addressed to any address reasonableunder the circumstances; or

(B) To cause the record or notification to be re-ceived within the time that it would have been re-ceived if properly sent under subparagraph (A) ofthis paragraph.

[(vvv)(A)] (www)(A) “Software” means a com-puter program and any supporting information pro-vided in connection with a transaction relating tothe program.

(B) The term does not include a computer pro-gram that is included in the definition of goods.

[(www)] (xxx) “State” means a state of theUnited States, the District of Columbia, Puerto Rico,the United States Virgin Islands or any territory or

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insular possession subject to the jurisdiction of theUnited States.

[(xxx)] (yyy) “Supporting obligation” means aletter-of-credit right or secondary obligation thatsupports the payment or performance of an account,chattel paper, a document, a general intangible, aninstrument or investment property.

[(yyy)] (zzz) “Tangible chattel paper” meanschattel paper evidenced by a record or records con-sisting of information that is inscribed on a tangiblemedium.

[(zzz)] (aaaa) “Termination statement” means anamendment of a financing statement which:

(A) Identifies, by its file number, the initial fi-nancing statement to which it relates; and

(B) Indicates either that it is a terminationstatement or that the identified financing statementis no longer effective.

[(aaaa)] (bbbb) “Transmitting utility” means anorganization primarily engaged in the business of:

(A) Operating a railroad, subway, street railwayor trolley bus;

(B) Transmitting communications electrically,electromagnetically or by light;

(C) Transmitting goods by pipeline or sewer; or(D) Transmitting or producing and transmitting

electricity, steam, gas or water.(2) “Control” as provided in ORS 77.1060 and the

following definitions in other sections apply to thischapter:

“Applicant” ORS 75.1020“Beneficiary” ORS 75.1020“Broker” ORS 78.1020“Certificated security” ORS 78.1020“Check” ORS 73.0104“Clearing corporation” ORS 78.1020“Contract for sale” ORS 72.1060“Customer” ORS 74.1040“Entitlement holder” ORS 78.1020“Financial asset” ORS 78.1020“Holder in due course” ORS 73.0302“Issuer” (with respectto a letter of credit orletter-of-credit right) ORS 75.1020“Issuer” (with respectto a security) ORS 78.2010“Issuer” (with respectto documents of title) ORS 77.1020“Lease” ORS 72A.1030“Lease agreement” ORS 72A.1030“Lease contract” ORS 72A.1030“Leasehold interest” ORS 72A.1030“Lessee” ORS 72A.1030“Lessee in ordinary courseof business” ORS 72A.1030“Lessor” ORS 72A.1030“Lessor’s residualinterest” ORS 72A.1030“Letter of credit” ORS 75.1020“Merchant” ORS 72.1040“Negotiable instrument” ORS 73.0104“Nominated person” ORS 75.1020“Note” ORS 73.0104“Proceeds of a letterof credit” ORS 75.1140

“Prove” ORS 73.0103“Sale” ORS 72.1060“Securities account” ORS 78.5010“Securities intermediary” ORS 78.1020“Security” ORS 78.1020“Security certificate” ORS 78.1020“Security entitlement” ORS 78.1020“Uncertificated security” ORS 78.1020

(3) ORS chapter 71 contains general definitionsand principles of construction and interpretation ap-plicable throughout this chapter.

SECTION 2. ORS 79.0105 is amended to read:79.0105. UCC 9-105. Control of electronic

chattel paper. [A secured party has control of elec-tronic chattel paper if the record or records compris-ing the chattel paper are created, stored and assignedin such a manner that:]

(1) A secured party has control of electronicchattel paper if a system employed for evidenc-ing the transfer of interests in the chattel paperreliably establishes the secured party as theperson to which the chattel paper was assigned.

(2) A system satisfies the provisions of sub-section (1) of this section if the record or re-cords comprising the chattel paper are created,stored and assigned in such a manner that:

[(1)] (a) A single authoritative copy of the recordor records exists which is unique, identifiable and,except as otherwise provided in [subsections (4), (5)and (6) of this section] paragraphs (d), (e) and (f)of this subsection, unalterable;

[(2)] (b) The authoritative copy identifies the se-cured party as the assignee of the record or records;

[(3)] (c) The authoritative copy is communicatedto and maintained by the secured party or its desig-nated custodian;

[(4)] (d) Copies or [revisions] amendments thatadd or change an identified assignee of the authori-tative copy can be made only with the[participation] consent of the secured party;

[(5)] (e) Each copy of the authoritative copy andany copy of a copy is readily identifiable as a copythat is not the authoritative copy; and

[(6)] (f) Any [revision] amendment of the au-thoritative copy is readily identifiable as [an] au-thorized or unauthorized [revision].

SECTION 3. ORS 79.0208 is amended to read:79.0208. UCC 9-208. Additional duties of se-

cured party having control of collateral. (1) Thissection applies to cases in which there is no out-standing secured obligation and the secured party isnot committed to make advances, incur obligationsor otherwise give value.

(2) Within 10 days after receiving an authenti-cated demand by the debtor:

(a) A secured party having control of a depositaccount under ORS 79.0104 (1)(b) shall send to thebank with which the deposit account is maintainedan authenticated statement that releases the bankfrom any further obligation to comply with in-structions originated by the secured party;

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(b) A secured party having control of a depositaccount under ORS 79.0104 (1)(c) shall:

(A) Pay the debtor the balance on deposit in thedeposit account; or

(B) Transfer the balance on deposit into a de-posit account in the debtor’s name;

(c) A secured party, other than a buyer, havingcontrol of electronic chattel paper under ORS79.0105 shall:

(A) Communicate the authoritative copy of theelectronic chattel paper to the debtor or its desig-nated custodian;

(B) If the debtor designates a custodian that isthe designated custodian with which the authori-tative copy of the electronic chattel paper is main-tained for the secured party, communicate to thecustodian an authenticated record releasing the des-ignated custodian from any further obligation tocomply with instructions originated by the securedparty and instructing the custodian to comply withinstructions originated by the debtor; and

(C) Take appropriate action to enable the debtoror its designated custodian to make copies of or [re-visions] amendments to the authoritative copywhich add or change an identified assignee of theauthoritative copy without the consent of the se-cured party;

(d) A secured party having control of investmentproperty under ORS 78.1060 (4)(b) or 79.0106 (2) shallsend to the securities intermediary or commodityintermediary with which the security entitlement orcommodity contract is maintained an authenticatedrecord that releases the securities intermediary orcommodity intermediary from any further obligationto comply with entitlement orders or directionsoriginated by the secured party;

(e) A secured party having control of a letter-of-credit right under ORS 79.0107 shall send to eachperson having an unfulfilled obligation to pay or de-liver proceeds of the letter of credit to the securedparty an authenticated release from any further ob-ligation to pay or deliver proceeds of the letter ofcredit to the secured party; and

(f) A secured party having control of an elec-tronic document shall:

(A) Give control of the electronic document tothe debtor or a designated custodian;

(B) If the debtor designates a custodian that isthe designated custodian with which the authori-tative copy of the electronic document is maintainedfor the secured party, communicate to the custodianan authenticated record releasing the designatedcustodian from any further obligation to comply withinstructions originated by the secured party and in-structing the custodian to comply with instructionsoriginated by the debtor; and

(C) Take appropriate action to enable the debtoror its designated custodian to make copies of or [re-visions] amendments to the authoritative copy thatadd or change an identified assignee of the authori-tative copy without the consent of the secured party.

SECTION 4. ORS 79.0307 is amended to read:

79.0307. UCC 9-307. Location of debtor. (1) Asused in this section, “place of business” means aplace where a debtor conducts its affairs.

(2) Except as otherwise provided in this section,the following rules determine a debtor’s location:

(a) A debtor who is an individual is located atthe individual’s principal residence.

(b) A debtor that is an organization and has onlyone place of business is located at its place of busi-ness.

(c) A debtor that is an organization and hasmore than one place of business is located at itschief executive office.

(3) Subsection (2) of this section applies only ifa debtor’s residence, place of business or chief exec-utive office, as applicable, is located in a jurisdictionwhose law generally requires information concerningthe existence of a nonpossessory security interest tobe made generally available in a filing, recording orregistration system as a condition or result of thesecurity interest’s obtaining priority over the rightsof a lien creditor with respect to the collateral. Ifsubsection (2) of this section does not apply, thedebtor is located in the District of Columbia.

(4) A person that ceases to exist, have a resi-dence or have a place of business continues to belocated in the jurisdiction specified by subsections(2) and (3) of this section.

(5) A registered organization that is organizedunder the law of a state is located in that state.

(6) Except as otherwise provided in subsection(9) of this section, a registered organization that isorganized under the law of the United States and abranch or agency of a bank that is not organizedunder the law of the United States or a state arelocated:

(a) In the state that the law of the United Statesdesignates, if the law designates a state of location;

(b) In the state that the registered organization,branch or agency designates, if the law of theUnited States authorizes the registered organization,branch or agency to designate its state of location,including by designating its main office, homeoffice or other comparable office; or

(c) In the District of Columbia, if neither para-graph (a) nor paragraph (b) of this subsection ap-plies.

(7) A registered organization continues to be lo-cated in the jurisdiction specified by subsection (5)or (6) of this section notwithstanding:

(a) The suspension, revocation, forfeiture orlapse of the registered organization’s status as suchin its jurisdiction of organization; or

(b) The dissolution, winding up or cancellationof the existence of the registered organization.

(8) The United States is located in the Districtof Columbia.

(9) A branch or agency of a bank that is not or-ganized under the law of the United States or astate is located in the state in which the branch oragency is licensed, if all branches and agencies ofthe bank are licensed in only one state.

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(10) A foreign air carrier under the Federal Avi-ation Act of 1958, as amended, is located at the des-ignated office of the agent upon which service ofprocess may be made on behalf of the carrier.

(11) This section applies only for purposes ofORS 79.0301 to 79.0342.

SECTION 5. ORS 79.0311 is amended to read:79.0311. UCC 9-311. Perfection of security in-

terests in property subject to certain statutes,regulations and treaties. (1) Except as otherwiseprovided in subsection (4) of this section, the filingof a financing statement is not necessary or effectiveto perfect a security interest in property subject to:

(a) A statute, regulation or treaty of the UnitedStates whose requirements for a security interest’sobtaining priority over the rights of a lien creditorwith respect to the property preempt ORS 79.0310(1);

(b) ORS chapter 830 and the Oregon VehicleCode;

(c) A [certificate-of-title] statute of another juris-diction [which] that provides for a security interestto be indicated on [the] a certificate of title as acondition or result of the security interest’s obtain-ing priority over the rights of a lien creditor withrespect to the property; or

(d) ORS 446.611 (1).(2) Compliance with the requirements of a stat-

ute, regulation or treaty described in subsection (1)of this section for obtaining priority over the rightsof a lien creditor is equivalent to the filing of a fi-nancing statement under this chapter. Except asotherwise provided in subsection (4) of this sectionand ORS 79.0313, 79.0316 (4) and (5) and 79.0334 forgoods covered by a certificate of title or for a man-ufactured structure, a security interest in propertysubject to a statute, regulation or treaty describedin subsection (1) of this section may be perfectedonly by compliance with those requirements, and asecurity interest so perfected remains perfected not-withstanding a change in the use or transfer of pos-session of the collateral.

(3) Except as otherwise provided in subsection(4) of this section and ORS 79.0316 (4) and (5), dura-tion and renewal of perfection of a security interestperfected by compliance with the requirements pre-scribed by a statute, regulation or treaty describedin subsection (1) of this section are governed by thestatute, regulation or treaty. In other respects, thesecurity interest is subject to this chapter.

(4) During any period in which collateral subjectto a statute specified in subsection (1)(b) or (d) ofthis section is inventory held for sale or lease by aperson or leased by that person as lessor and thatperson is in the business of selling goods of thatkind, this section does not apply to a security inter-est in that collateral created by that person.

SECTION 6. ORS 79.0316 is amended to read:79.0316. UCC 9-316. Effect of change in gov-

erning law. (1) A security interest perfected pursu-ant to the law of the jurisdiction designated in ORS

79.0301 (1) or 79.0305 (3) remains perfected until theearliest of:

(a) The time perfection would have ceased underthe law of that jurisdiction;

(b) The expiration of four months after a changeof the debtor’s location to another jurisdiction; or

(c) The expiration of one year after a transfer ofcollateral to a person that thereby becomes a debtorand is located in another jurisdiction.

(2) If a security interest described in subsection(1) of this section becomes perfected under the lawof the other jurisdiction before the earliest time orevent described in that subsection, it remains per-fected thereafter. If the security interest does notbecome perfected under the law of the other juris-diction before the earliest time or event, it becomesunperfected and is deemed never to have been per-fected as against a purchaser of the collateral forvalue.

(3) A possessory security interest in collateral,other than goods covered by a certificate of title, amanufactured structure or as-extracted collateralconsisting of goods, remains continuously perfectedif:

(a) The collateral is located in one jurisdictionand subject to a security interest perfected underthe law of that jurisdiction;

(b) Thereafter the collateral is brought into an-other jurisdiction; and

(c) Upon entry into the other jurisdiction, thesecurity interest is perfected under the law of theother jurisdiction.

(4) Except as otherwise provided in subsection(5) of this section, a security interest in goods cov-ered by a certificate of title or in a manufacturedstructure that is perfected by any method under thelaw of another jurisdiction when the goods becomecovered by a certificate of title or a manufacturedstructure ownership document or deed record in thisstate remains perfected until the security interestwould have become unperfected under the law of theother jurisdiction had the goods not become so cov-ered.

(5) A security interest described in subsection (4)of this section becomes unperfected as against apurchaser of the goods for value and is deemednever to have been perfected as against a purchaserof the goods for value if the applicable requirementsfor perfection under ORS 79.0311 (2) or 79.0313 arenot satisfied before the earlier of:

(a) The time the security interest would havebecome unperfected under the law of the other ju-risdiction had the goods not become covered by acertificate of title or a manufactured structure own-ership document or deed record in this state; or

(b) The expiration of four months after the goodshad become so covered.

(6) A security interest in deposit accounts,letter-of-credit rights or investment property whichis perfected under the law of the bank’s jurisdiction,the issuer’s jurisdiction, a nominated person’s juris-diction, the securities intermediary’s jurisdiction or

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the commodity intermediary’s jurisdiction, as appli-cable, remains perfected until the earlier of:

(a) The time the security interest would havebecome unperfected under the law of that jurisdic-tion; or

(b) The expiration of four months after a changeof the applicable jurisdiction to another jurisdiction.

(7) If a security interest described in subsection(6) of this section becomes perfected under the lawof the other jurisdiction before the earlier of thetime or the end of the period described in subsection(6) of this section, it remains perfected thereafter. Ifthe security interest does not become perfected un-der the law of the other jurisdiction before the ear-lier of that time or the end of that period, it becomesunperfected and is deemed never to have been per-fected as against a purchaser of the collateral forvalue.

(8) The following rules apply to collateral towhich a security interest attaches within fourmonths after the debtor changes the debtor’slocation to another jurisdiction:

(a) A financing statement filed before thechange pursuant to the law of the jurisdictiondesignated in ORS 79.0301 (1) or 79.0305 (3) is ef-fective to perfect a security interest in thecollateral if the financing statement would havebeen effective to perfect a security interest inthe collateral had the debtor not changed thedebtor’s location.

(b) If a security interest perfected by a fi-nancing statement that is effective under para-graph (a) of this subsection becomes perfectedunder the law of the other jurisdiction beforethe earlier of the time the financing statementwould have become ineffective under the law ofthe jurisdiction designated in ORS 79.0301 (1) or79.0305 (3), or the expiration of the four-monthperiod, it remains perfected thereafter. If thesecurity interest does not become perfected un-der the law of the other jurisdiction before theearlier time or event, it becomes unperfectedand is deemed never to have been perfected asagainst a purchaser of the collateral for value.

(9) If a financing statement naming an ori-ginal debtor is filed pursuant to the law of thejurisdiction designated in ORS 79.0301 (1) or79.0305 (3) and the new debtor in another juris-diction, the following rules apply:

(a) The financing statement is effective toperfect a security interest in collateral acquiredby the new debtor before, and within fourmonths after, the new debtor becomes boundunder ORS 79.0203 (4) if the financing statementwould have been effective to perfect a securityinterest in the collateral had the collateral beenacquired by the original debtor.

(b) A security interest perfected by the fi-nancing statement and that becomes perfectedunder the law of the other jurisdiction beforethe earlier of the time the financing statementwould have become ineffective under the law ofthe jurisdiction designated in ORS 79.0301 (1) or

79.0305 (3), or the expiration of the four-monthperiod, remains perfected thereafter. A securityinterest that is perfected by the financing state-ment but that does not become perfected underthe law of the other jurisdiction before the ear-lier time or event becomes unperfected and isdeemed never to have been perfected as againsta purchaser of the collateral for value.

SECTION 7. ORS 79.0317 is amended to read:79.0317. UCC 9-317. Interests that take prior-

ity over or take free of security interest or ag-ricultural lien. (1) A security interest oragricultural lien is subordinate to the rights of:

(a) A person entitled to priority under ORS79.0322; and

(b) Except as otherwise provided in subsection(5) of this section, a person that becomes a liencreditor before the earlier of the time:

(A) The security interest or agricultural lien isperfected; or

(B) One of the conditions specified in ORS79.0203 (2)(c) is met and a financing statement cov-ering the collateral is filed.

(2) Except as otherwise provided in subsection(5) of this section, a buyer, other than a securedparty, of tangible chattel paper, tangible documents,goods, instruments or a certificated security [certif-icate] takes free of a security interest or agriculturallien if the buyer gives value and receives deliveryof the collateral without knowledge of the securityinterest or agricultural lien and before it is per-fected.

(3) Except as otherwise provided in subsection(5) of this section, a lessee of goods takes free of asecurity interest or agricultural lien if the lesseegives value and receives delivery of the collateralwithout knowledge of the security interest or agri-cultural lien and before it is perfected.

(4) A licensee of a general intangible or a buyer,other than a secured party, of [accounts, electronicchattel paper, electronic documents, general intangi-bles or investment property] collateral other thantangible chattel paper, tangible documents,goods, instruments or a certificated security takesfree of a security interest if the licensee or buyergives value without knowledge of the security inter-est and before it is perfected.

(5) Except as otherwise provided in ORS 79.0320and 79.0321, if a person files a financing statementwith respect to a purchase-money security interestbefore or within 20 days after the debtor receivesdelivery of the collateral, the security interest takespriority over the rights of a buyer, lessee or liencreditor which arise between the time the securityinterest attaches and the time of filing.

SECTION 8. ORS 79.0326 is amended to read:79.0326. UCC 9-326. Priority of security inter-

ests created by new debtor. (1) Subject to subsec-tion (2) of this section, a security interest that iscreated by a new debtor [which is] in collateral inwhich the new debtor has or acquires rights and

9


is perfected solely by a filed financing statementthat [is effective solely under ORS 79.0508 in collat-eral in which a new debtor has or acquires rights]would be ineffective to perfect the security in-terest but for the application of ORS 79.0316(9)(a) or 79.0508 is subordinate to a security interestin the same collateral which is perfected other thanby such a filed financing statement [that is effectivesolely under ORS 79.0508].

(2) The other provisions of ORS 79.0301 to79.0342 determine the priority among conflicting se-curity interests in the same collateral perfected byfiled financing statements [that are effective solelyunder ORS 79.0508] described in subsection (1) ofthis section. However, if the security agreements towhich a new debtor became bound as debtor werenot entered into by the same original debtor, theconflicting security interests rank according to pri-ority in time of the new debtor’s having becomebound.

SECTION 9. ORS 79.0335 is amended to read:79.0335. UCC 9-335. Accessions. (1) A security

interest may be created in an accession and contin-ues in collateral that becomes an accession.

(2) If a security interest is perfected when thecollateral becomes an accession, the security inter-est remains perfected in the collateral.

(3) Except as otherwise provided in subsections(4) and (7) of this section, the other provisions ofORS 79.0301 to 79.0342 determine the priority of asecurity interest in an accession.

(4) Except as otherwise provided in subsection(7) of this section, a security interest in an accessionis subordinate to a security interest in the wholewhich is perfected by compliance with [the require-ments of a certificate-of-title statute under] ORS79.0311 (2), [or with ORS] 446.611 or 446.626.

(5) After default, subject to ORS 79.0601 to79.0628, a secured party may remove an accessionfrom other goods if the security interest in the ac-cession has priority over the claims of every personhaving an interest in the whole.

(6) A secured party that removes an accessionfrom other goods under subsection (5) of this sectionshall promptly reimburse any holder of a securityinterest or other lien on, or owner of, the whole orof the other goods, other than the debtor, for thecost of repair of any physical injury to the whole orthe other goods. The secured party need not reim-burse the holder or owner for any diminution invalue of the whole or the other goods caused by theabsence of the accession removed or by any neces-sity for replacing it. A person entitled to reimburse-ment may refuse permission to remove until thesecured party gives adequate assurance for the per-formance of the obligation to reimburse.

(7) A security interest in an accession has prior-ity over a security interest in the whole which isperfected by compliance with the requirements of [acertificate-of-title statute under] ORS 79.0311 (2) orwith ORS 446.611 or 446.626 if the security interestin the accession is a purchase money security inter-

est that is perfected when the debtor receives pos-session of the accession or within 20 days thereafter.

SECTION 10. ORS 79.0406 is amended to read:79.0406. UCC 9-406. Discharge of account

debtor; notification of assignment; identificationand proof of assignment; restrictions on assign-ment of accounts, chattel paper, payment in-tangibles and promissory notes ineffective. (1)Subject to subsections (2) to (9) of this section, anaccount debtor on an account, chattel paper or apayment intangible may discharge its obligation bypaying the assignor until, but not after, the accountdebtor receives a notification, authenticated by theassignor or the assignee, that the amount due or tobecome due has been assigned and that payment isto be made to the assignee. After receipt of the no-tification, the account debtor may discharge its ob-ligation by paying the assignee and may notdischarge the obligation by paying the assignor.

(2) Subject to subsection (8) of this section, no-tification is ineffective under subsection (1) of thissection:

(a) If it does not reasonably identify the rightsassigned;

(b) To the extent that an agreement between anaccount debtor and a seller of a payment intangiblelimits the account debtor’s duty to pay a personother than the seller and the limitation is effectiveunder law other than this chapter; or

(c) At the option of an account debtor, if thenotification notifies the account debtor to make lessthan the full amount of any installment or other pe-riodic payment to the assignee, even if:

(A) Only a portion of the account, chattel paperor payment intangible has been assigned to thatassignee;

(B) A portion has been assigned to anotherassignee; or

(C) The account debtor knows that the assign-ment to that assignee is limited.

(3) Subject to subsection (8) of this section, ifrequested by the account debtor, an assignee shallseasonably furnish reasonable proof that the assign-ment has been made. Unless the assignee complies,the account debtor may discharge its obligation bypaying the assignor, even if the account debtor hasreceived a notification under subsection (1) of thissection.

(4) Except as otherwise provided in subsection(5) of this section and ORS 72A.3030 and 79.0407,and subject to subsection (8) of this section, a termin an agreement between an account debtor and anassignor or in a promissory note is ineffective to theextent that it:

(a) Prohibits, restricts or requires the consent ofthe account debtor or person obligated on thepromissory note to the assignment or transfer of, orthe creation, attachment, perfection or enforcementof a security interest in, the account, chattel paper,payment intangible or promissory note; or

(b) Provides that the assignment or transfer orthe creation, attachment, perfection or enforcement

10


of the security interest may give rise to a default,breach, right of recoupment, claim, defense, termi-nation, right of termination or remedy under theaccount, chattel paper, payment intangible orpromissory note.

(5) Subsection (4) of this section does not applyto the sale of a payment intangible or promissorynote, other than a sale pursuant to a dispositionunder ORS 79.0610 or an acceptance of collateralunder ORS 79.0620.

(6) Except as otherwise provided in ORS72A.3030 and 79.0407 and subject to subsections (8)and (9) of this section, a rule of law, statute or reg-ulation that prohibits, restricts or requires the con-sent of a government, governmental body or official,or account debtor to the assignment or transfer of,or creation of a security interest in, an account orchattel paper is ineffective to the extent that therule of law, statute or regulation:

(a) Prohibits, restricts or requires the consent ofthe government, governmental body or official, oraccount debtor to the assignment or transfer of, orthe creation, attachment, perfection or enforcementof a security interest in the account or chattel pa-per; or

(b) Provides that the assignment or transfer orthe creation, attachment, perfection or enforcementof the security interest may give rise to a default,breach, right of recoupment, claim, defense, termi-nation, right of termination or remedy under theaccount or chattel paper.

(7) Subject to subsection (8) of this section, anaccount debtor may not waive or vary its optionunder subsection (2)(c) of this section.

(8) This section is subject to law other than thischapter which establishes a different rule for an ac-count debtor who is an individual and who incurredthe obligation primarily for personal, family orhousehold purposes.

(9)(a) This section does not apply to the assign-ment of a health-care-insurance receivable.

(b) Subsections (4) and (6) of this section do notapply to the assignment or transfer of, or the cre-ation of a security interest in, a claim or right toreceive compensation for injuries or sickness as de-scribed in 26 U.S.C. 104(a)(2), provided that suchtransaction constitutes a sale of such claim or right.The limitation in this paragraph is intended to leaveto the court the determination of the proper rules insuch cases. The court may not infer from that limi-tation the nature of the proper rule in such casesand may continue to apply established approaches.

(c) Subsections (4) and (6) of this section do notapply to the following:

(A) The assignment or transfer of, or the cre-ation of a security interest in, a claim or right toreceive compensation for injuries or sickness as de-scribed in 26 U.S.C. 104(a)(1);

(B) The assignment or transfer of, or the cre-ation of a security interest in, a claim or right toreceive benefits under a special needs trust as de-scribed in 42 U.S.C. 1396p(d)(4); or

(C) The assignment or transfer of, or the cre-ation, attachment, perfection or enforcement of asecurity interest in, the benefits, rights, privilegesor options accruing under an annuity policy, to theextent that the annuity policy provides for such arestriction and the restriction is permitted underORS 743.049.

(d) Subsection (6) of this section does not applyto the assignment or transfer of, or the creation, at-tachment, perfection or enforcement of a securityinterest in, a right when the transfer of the right isprohibited or restricted by ORS 147.325, 461.250 (8)or 656.234, to the extent that ORS 147.325, 461.250(8) or 656.234 is inconsistent with subsection (6) ofthis section.

(10) Except to the extent otherwise provided insubsection (9) of this section, this section prevailsover any inconsistent provision of an existing or fu-ture statute unless the provision refers expressly tothis section and states that the provision prevailsover this section.

SECTION 11. ORS 79.0408 is amended to read:79.0408. UCC 9-408. Restrictions on assign-

ment of promissory notes, health care insurancereceivables and certain general intangibles inef-fective. (1) Except as otherwise provided in subsec-tion (2) of this section, a term in a promissory noteor in an agreement between an account debtor anda debtor which relates to a health-care-insurancereceivable or a general intangible, including a con-tract, permit, license or franchise, and which termprohibits, restricts or requires the consent of theperson obligated on the promissory note or the ac-count debtor to, the assignment or transfer of, orcreation, attachment or perfection of a security in-terest in, the promissory note, health-care-insurancereceivable or general intangible, is ineffective to theextent that the term:

(a) Would impair the creation, attachment orperfection of a security interest; or

(b) Provides that the assignment or transfer orthe creation, attachment or perfection of the secu-rity interest may give rise to a default, breach, rightof recoupment, claim, defense, termination, right oftermination or remedy under the promissory note,health-care-insurance receivable or general intangi-ble.

(2) Subsection (1) of this section applies to a se-curity interest in a payment intangible orpromissory note only if the security interest arisesout of a sale of the payment intangible or promissorynote, other than a sale pursuant to a dispositionunder ORS 79.0610 or an acceptance of collateralunder ORS 79.0620.

(3) A rule of law, statute or regulation that pro-hibits, restricts or requires the consent of a govern-ment, governmental body or official, person obligatedon a promissory note or account debtor to the as-signment or transfer of, or creation of a security in-terest in, a promissory note, health-care-insurancereceivable or general intangible, including a con-tract, permit, license or franchise between an ac-

11


count debtor and a debtor, is ineffective to theextent that the rule of law, statute or regulation:

(a) Would impair the creation, attachment orperfection of a security interest; or

(b) Provides that the assignment or transfer orthe creation, attachment or perfection of the secu-rity interest may give rise to a default, breach, rightof recoupment, claim, defense, termination, right oftermination or remedy under the promissory note,health-care-insurance receivable or general intangi-ble.

(4) To the extent that a term in a promissorynote or in an agreement between an account debtorand a debtor which relates to a health-care-insurance receivable or general intangible or a ruleof law, statute or regulation described in subsection(3) of this section would be effective under law otherthan this chapter but is ineffective under subsection(1) or (3) of this section, the creation, attachment orperfection of a security interest in the promissorynote, health-care-insurance receivable or general in-tangible:

(a) Is not enforceable against the person obli-gated on the promissory note or the account debtor;

(b) Does not impose a duty or obligation on theperson obligated on the promissory note or the ac-count debtor;

(c) Does not require the person obligated on thepromissory note or the account debtor to recognizethe security interest, pay or render performance tothe secured party, or accept payment or performancefrom the secured party;

(d) Does not entitle the secured party to use orassign the debtor’s rights under the promissory note,health-care-insurance receivable or general intangi-ble, including any related information or materialsfurnished to the debtor in the transaction giving riseto the promissory note, health-care-insurance receiv-able or general intangible;

(e) Does not entitle the secured party to use, as-sign, possess or have access to any trade secrets orconfidential information of the person obligated onthe promissory note or the account debtor; and

(f) Does not entitle the secured party to enforcethe security interest in the promissory note, health-care-insurance receivable or general intangible.

(5)(a) Subsections (1) and (3) of this section donot apply to the assignment or transfer of, or thecreation of a security interest in, a claim or right toreceive compensation for injuries or sickness as de-scribed in 26 U.S.C. 104(a)(2), provided that suchtransaction constitutes a sale of such claim or right.The limitation in this paragraph is intended to leaveto the court the determination of the proper rules insuch cases. The court may not infer from that limi-tation the nature of the proper rule in such casesand may continue to apply established approaches.

(b) Subsections (1) and (3) of this section do notapply to the following:

(A) The assignment or transfer of, or the cre-ation of a security interest in, a claim or right toreceive compensation for injuries or sickness as de-scribed in 26 U.S.C. 104(a)(1);

(B) The assignment or transfer of, or the cre-ation of a security interest in, a claim or right toreceive benefits under a special needs trust as de-scribed in 42 U.S.C. 1396p(d)(4); or

(C) The assignment or transfer of, or the cre-ation, attachment, perfection or enforcement of asecurity interest in, the benefits, rights, privilegesor options accruing under an annuity policy, to theextent that the annuity policy provides for such arestriction and the restriction is permitted underORS 743.049.

(c) Subsection (3) of this section does not applyto the assignment or transfer of, or the creation, at-tachment, perfection or enforcement of a securityinterest in, a right when the transfer of the right isprohibited or restricted by ORS 147.325, 461.250 (8)or 656.234, to the extent that ORS 147.325, 461.250(8) or 656.234 is inconsistent with subsection (3) ofthis section.

(6) Except to the extent otherwise provided insubsection (5) of this section, this section prevailsover any inconsistent provision of an existing or fu-ture statute unless the provision refers expressly tothis section and states that the provision prevailsover this section.

SECTION 12. ORS 79.0503 is amended to read:79.0503. UCC 9-503. Name of debtor and se-

cured party. (1) A financing statement sufficientlyprovides the name of the debtor:

(a) Except as otherwise provided in para-graph (c) of this subsection, if the debtor is aregistered organization or the collateral is held ina trust that is a registered organization, only ifthe financing statement provides the name [of thedebtor indicated] that is stated to be the regis-tered organization’s name on the public organicrecord [of] most recently filed with or issued orenacted by the [debtor’s] registered organization’sjurisdiction of organization [which shows the debtorto have been organized] that purports to state,amend or restate the registered organization’sname;

(b) Subject to subsection (6) of this section,if the [debtor is a decedent’s estate] collateral is be-ing administered by the personal representativeof a decedent, only if the financing statement pro-vides, as the name of the debtor, the name of thedecedent and, in a separate part of the financingstatement, indicates that the [debtor is an estate]collateral is being administered by a personalrepresentative;

(c) If the [debtor is a trust or a trustee actingwith respect to property held in trust, only if the fi-nancing statement] collateral is held in a trustthat is not a registered organization, only if thefinancing statement:

[(A) Provides the name specified for the trust inits organic documents or, if no name is specified,provides the name of the settlor and additional infor-mation sufficient to distinguish the debtor from othertrusts having one or more of the same settlors; and]

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[(B) Indicates, in the debtor’s name or otherwise,that the debtor is a trust or is a trustee acting withrespect to property held in trust; and]

(A) Provides, as the name of the debtor:(i) If the organic record of the trust specifies

a name for the trust, the name specified; or(ii) If the organic record of the trust does

not specify a name for the trust, the name ofthe settlor or testator; and

(B) In a separate part of the financingstatement:

(i) If the name is provided in accordancewith subparagraph (A)(i) of this paragraph, in-dicates that the collateral is held in trust; or

(ii) If the name is provided in accordancewith subparagraph (A)(ii) of this paragraph,provides additional information sufficient todistinguish the trust from other trusts havingone or more of the same settlors or the sametestator and indicates that the collateral is heldin a trust, unless the additional information soindicates;

(d) If the debtor is an individual, only if thefinancing statement:

(A) Provides the individual name of thedebtor;

(B) Provides the surname and first personalname of the debtor; or

(C) Subject to subsection (7) of this section,provides the name of the individual that is indi-cated on a driver license or identification cardthat this state has issued to the individual andthat has not expired; and

[(d)] (e) In other cases:(A) If the debtor has a name, only if [it] the fi-

nancing statement provides the [individual or] or-ganizational name of the debtor; and

(B) If the debtor does not have a name, only if[it] the financing statement provides the names ofthe partners, members, associates or other personscomprising the debtor in a manner that eachname provided would be sufficient if the personnamed were the debtor.

(2) A financing statement that provides the nameof the debtor in accordance with subsection (1) ofthis section is not rendered ineffective by the ab-sence of:

(a) A trade name or other name of the debtor;or

(b) Unless required under subsection [(1)(d)(B)](1)(e)(B) of this section, names of partners, mem-bers, associates or other persons comprising thedebtor.

(3) A financing statement that provides only thedebtor’s trade name does not sufficiently provide thename of the debtor.

(4) Failure to indicate the representative capac-ity of a secured party or representative of a securedparty does not affect the sufficiency of a financingstatement.

(5) A financing statement may provide the nameof more than one debtor and the name of more thanone secured party.

(6) The name of the decedent indicated onthe order appointing the personal representativeof the decedent issued by the court having ju-risdiction over the collateral is sufficient as thename of the decedent under subsection (1)(b) ofthis section.

(7) If this state has issued to an individualmore than one driver license or identificationcard of a kind described in subsection (1)(d)(C)of this section, the one that was issued mostrecently is the one to which subsection (1)(d)(C)of this section refers.

(8) As used in this section, “name of thesettlor or testator” means:

(a) If the settlor is a registered organization,the name that is stated to be the settlor’s nameon the public organic record most recently filedwith or issued or enacted by the settlor’s juris-diction of organization that purports to state,amend or restate the settlor’s name; or

(b) In other cases, the name of the settloror testator indicated in the trust’s organic re-cord.

SECTION 13. ORS 79.0507 is amended to read:79.0507. UCC 9-507. Effect of certain events

on effectiveness of financing statement. (1) Afiled financing statement remains effective with re-spect to collateral that is sold, exchanged, leased,licensed or otherwise disposed of and in which a se-curity interest or agricultural lien continues, evenif the secured party knows of or consents to thedisposition.

(2) Except as otherwise provided in subsection(3) of this section and ORS 79.0506 (4) and 79.0508,a financing statement is not rendered ineffective if,after the financing statement is filed, the informa-tion provided in the financing statement becomesseriously misleading under ORS 79.0506.

(3) If [a debtor so changes its] the name that afiled financing statement provides for a debtor be-comes insufficient as the name of the debtor un-der ORS 79.0503 (1) so that the financingstatement becomes seriously misleading underORS 79.0506:

(a) The financing statement is effective to perfecta security interest in collateral acquired by thedebtor before, or within four months after, the[change] filed financing statement becomes seri-ously misleading; and

(b) The financing statement is not effective toperfect a security interest in collateral acquired bythe debtor more than four months after the [change]filed financing statement becomes seriouslymisleading, unless an amendment to the financingstatement which renders the financing statement notseriously misleading is filed within four months afterthe [change] financing statement becomes seri-ously misleading.

SECTION 14. ORS 79.0515 is amended to read:79.0515. UCC 9-515. Duration and effective-

ness of financing statement; effect of lapsed fi-

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nancing statement; renewal notice; rules. (1)Except as otherwise provided in subsections (2), (5),(6) and (7) of this section, a filed financing statementis effective for a period of five years after the dateof filing.

(2) Except as otherwise provided in subsections(5), (6) and (7) of this section, an initial financingstatement filed in connection with a public-financetransaction is effective for a period of 30 years afterthe date of filing if it indicates that it is filed inconnection with a public-finance transaction.

(3) The effectiveness of a filed financing state-ment lapses on the expiration of the period of its ef-fectiveness unless before the lapse a continuationstatement is filed pursuant to subsection (4) of thissection. Upon lapse, a financing statement ceases tobe effective and any security interest or agriculturallien that was perfected by the financing statementbecomes unperfected, unless the security interest isperfected otherwise. If the security interest or agri-cultural lien becomes unperfected upon lapse, it isdeemed never to have been perfected as against apurchaser of the collateral for value.

(4) A continuation statement may be filed onlywithin six months before the expiration of the five-year period specified in subsection (1) of this sectionor the 30-year period specified in subsection (2) ofthis section, whichever is applicable.

(5) Except as otherwise provided in ORS 79.0510,upon timely filing of a continuation statement, theeffectiveness of the initial financing statement con-tinues for a period of five years commencing on theday on which the financing statement would havebecome ineffective in the absence of the filing. Uponthe expiration of the five-year period, the financingstatement lapses in the same manner as provided insubsection (3) of this section, unless, before thelapse, another continuation statement is filed pursu-ant to subsection (4) of this section. Succeedingcontinuation statements may be filed in the samemanner to continue the effectiveness of the initialfinancing statement.

(6) If a debtor is a transmitting utility and a filedinitial financing statement so indicates, the financ-ing statement is effective until a termination state-ment is filed.

(7) A record of a mortgage that is effective as afinancing statement filed as a fixture filing underORS 79.0502 (3) remains effective as a financingstatement filed as a fixture filing until the mortgageis released or satisfied of record or its effectivenessotherwise terminates as to the real property.

(8) The Secretary of State upon request shallprovide a renewal notice report to a secured partyby electronic mail or other electronic means. Therenewal notice report must include:

(a) The file number and expiration date for eachfinancing statement or effective financing statement,as defined in ORS 80.100, or a continuation of thefinancing statement or effective financing statement,that:

(A) Lists the secured party; and

(B) Will expire within a period that begins 90days after the date of the notice and ends one yearafter the date of the notice;

(b) The name of the debtor;(c) A statement that to continue the financing

statement or effective financing statement, the se-cured party may file a continuation statement or aninitial financing statement under section 191 or 192,chapter 445, Oregon Laws 2001; and

(d) Other information that the Secretary of Statespecifies by rule.

SECTION 15. ORS 79.0516 is amended to read:79.0516. UCC 9-516. What constitutes filing;

effectiveness of filing. (1) Except as otherwise pro-vided in subsection (2) of this section, communi-cation of a record to and receipt by a filing officeand tender of the filing fee or acceptance of the re-cord by the filing office constitutes filing.

(2) Filing does not occur with respect to a recordthat a filing office refuses to accept because:

(a) The record is not communicated by a methodor medium of communication authorized by the filingoffice;

(b) An amount equal to or greater than the ap-plicable filing fee is not tendered;

(c) The filing office is unable to index the recordbecause:

(A) In the case of an initial financing statement,the record does not provide a name for the debtor;

(B) In the case of an amendment or [correction]information statement, the record:

(i) Does not identify the initial financing state-ment as required by ORS 79.0512 or 79.0518, as ap-plicable; or

(ii) Identifies an initial financing statementwhose effectiveness has lapsed under ORS 79.0515,and the filing office is that described in ORS 79.0501(1)(b);

(C) In the case of an initial financing statementthat provides the name of a debtor identified as anindividual or an amendment that provides a name ofa debtor identified as an individual which was notpreviously provided in the financing statement towhich the record relates, the record does not iden-tify the debtor’s [last name] surname; or

(D) In the case of a record filed or recorded inthe filing office described in ORS 79.0501 (1)(a), therecord does not provide a sufficient description ofthe real property to which it relates;

(d) In the case of an initial financing statementor an amendment that adds a secured party of re-cord, the record does not provide a name and mail-ing address for the secured party of record;

(e) In the case of an initial financing statementor an amendment that provides a name of a debtorwhich was not previously provided in the financingstatement to which the amendment relates, the re-cord does not:

(A) Provide a mailing address for the debtor,unless the initial financing statement or amendmentis included in a mortgage and the filing office is thatdescribed in ORS 79.0501 (1)(a); or

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(B) Indicate whether the name provided as thename of the debtor is the name of an individualor an organization, unless the initial financingstatement or amendment is included in a mortgageand the filing office is that described in ORS 79.0501(1)(a); [or]

[(C) If the filing office is that described in ORS79.0501 (1)(b) and the financing statement indicatesthat the debtor is an organization, provide:]

[(i) A type of organization for the debtor;][(ii) A jurisdiction of organization for the debtor

or, as an alternative when the debtor is not a regis-tered organization, an indication that the debtor isnot a registered organization; or]

[(iii) An organizational identification number forthe debtor or indicate that the debtor has none;]

(f) In the case of an assignment reflected in aninitial financing statement under ORS 79.0514 (1) oran amendment filed under ORS 79.0514 (2), the re-cord does not provide a name and mailing addressfor the assignee;

(g) In the case of a continuation statement, therecord is not filed within the six-month period pre-scribed by ORS 79.0515 (4) and the filing office isthat described in ORS 79.0501 (1)(b); or

(h) In the case of a record presented for filingat the filing office described in ORS 79.0501 (1)(b),the record on its face reveals, based on factors suchas whether the debtor and the secured party are thesame person or whether the collateral described iswithin the scope of this chapter, that the record isbeing filed for a purpose other than a transactionthat is within the scope of this chapter.

(3) For purposes of subsection (2) of this section:(a) A record does not provide information if the

filing office is unable to read or decipher the infor-mation; and

(b) A record that does not indicate that it is anamendment or identify an initial financing statementto which it relates, as required by ORS 79.0512,79.0514 or 79.0518, is an initial financing statement.

(4) A record that is communicated to and re-ceived by the filing office with tender of the filingfee under subsection (1) of this section, but whichthe filing office refuses to accept for a reason otherthan one set forth in subsection (2) of this section,is effective as a filed record except as against apurchaser of the collateral which gives value inreasonable reliance upon the absence of the recordfrom the files.

SECTION 16. ORS 79.0518 is amended to read:79.0518. UCC 9-518. Claim concerning inaccu-

rate or wrongly filed record. (1) A person may filein the filing office [a correction] an informationstatement with respect to a record indexed thereunder the person’s name if the person believes thatthe record is inaccurate or was wrongfully filed.

(2) [A correction] An information statementunder subsection (1) of this section must:

(a) Identify the record to which it relates by thefile number assigned to the initial financing state-ment to which the record relates;

(b) Indicate that it is [a correction] an informa-tion statement;

(c) Provide the basis for the person’s belief thatthe record is inaccurate and indicate the manner inwhich the person believes the record should beamended to cure any inaccuracy or provide the basisfor the person’s belief that the record was wrong-fully filed; and

(d) Indicate the name of the debtor and the se-cured party.

(3) A person may file in the filing office aninformation statement with respect to a recordfiled there if the person is a secured party ofrecord with respect to the filing statement towhich the record relates and believes that theperson that filed the record was not entitled todo so under ORS 79.0509 (4).

(4) An information statement under subsec-tion (3) of this section must:

(a) Identify the record to which it relates bythe file number assigned to the initial financingstatement to which the record relates;

(b) Indicate that it is an information state-ment; and

(c) Provide the basis for the person’s beliefthat the person that filed the record was notentitled to do so under ORS 79.0509 (4).

[(3)] (5) The filing of [a correction] an informa-tion statement does not affect the effectiveness ofan initial financing statement or other filed record.

SECTION 17. ORS 79.0521 is amended to read:79.0521. UCC 9-521. Uniform form of written

financing statement and amendment. [(1)] A fil-ing office that accepts written records may not re-fuse to accept a written initial financing statement,addendum or amendment in the form and formatset forth in the final official text of the [1999] 2010revisions to Article 9 of the Uniform CommercialCode promulgated by The American Law Instituteand the [National Conference of Commissioners onUniform State Laws] Uniform Law Commission,except for a reason set forth in ORS 79.0516 (2).

[(2) A filing office that accepts written recordsmay not refuse to accept a written record in the formand format set forth in the final official text of the1999 revisions to Article 9 of the Uniform CommercialCode promulgated by The American Law Instituteand the National Conference of Commissioners onUniform State Laws, except for a reason set forth inORS 79.0516 (2).]

SECTION 18. ORS 79.0607 is amended to read:79.0607. UCC 9-607. Collection and enforce-

ment by secured party. (1) If so agreed, and in anyevent after default, a secured party:

(a) May notify an account debtor or other personobligated on collateral to make payment or other-wise render performance to or for the benefit of thesecured party;

(b) May take any proceeds to which the securedparty is entitled under ORS 79.0315;

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(c) May enforce the obligations of an accountdebtor or other person obligated on collateral andexercise the rights of the debtor with respect to theobligation of the account debtor or other person ob-ligated on collateral to make payment or otherwiserender performance to the debtor, and with respectto any property that secures the obligations of theaccount debtor or other person obligated on thecollateral;

(d) If it holds a security interest in a deposit ac-count perfected by control under ORS 79.0104 (1)(a),may apply the balance of the deposit account to theobligation secured by the deposit account; and

(e) If it holds a security interest in a deposit ac-count perfected by control under ORS 79.0104 (1)(b)or (c), may instruct the bank to pay the balance ofthe deposit account to or for the benefit of the se-cured party.

(2) If necessary to enable a secured party to ex-ercise under subsection (1)(c) of this section theright of a debtor to enforce a mortgagenonjudicially, the secured party may record in theoffice in which a record of the mortgage is recordedthe secured party’s sworn affidavit, with a copy ofthe security agreement attached thereto. The affida-vit shall be in recordable form and state that:

(a) A default has occurred with respect to theobligation secured by the mortgage; and

(b) The secured party is entitled to enforce themortgage nonjudicially.

(3) A secured party shall proceed in a commer-cially reasonable manner if the secured party:

(a) Undertakes to collect from or enforce an ob-ligation of an account debtor or other person obli-gated on collateral; and

(b) Is entitled to charge back uncollected collat-eral or otherwise to full or limited recourse againstthe debtor or a secondary obligor.

(4) A secured party may deduct from the col-lections made pursuant to subsection (3) of this sec-tion reasonable expenses of collection andenforcement, including reasonable attorney fees andlegal expenses incurred by the secured party.

(5) This section does not determine whether anaccount debtor, bank or other person obligated oncollateral owes a duty to a secured party.

SECTION 19. ORS 79.0619 is amended to read:79.0619. UCC 9-619. Transfer of record or legal

title. (1) As used in this section, “transferstatement” means a record authenticated by a se-cured party stating:

(a) That the debtor has defaulted in connectionwith an obligation secured by specified collateral;

(b) That the secured party has exercised itspost-default remedies with respect to the collateral;

(c) That, by reason of the exercise, a transfereehas acquired the rights of the debtor in the collat-eral; and

(d) The name and mailing address of the securedparty, debtor and transferee.

(2) A transfer statement entitles the transfereeto the transfer of record of all rights of the debtorin the collateral specified in the statement in anyofficial system for filing, recording[, registration orcertificate-of-title system] or registration coveringthe collateral or in accordance with the pro-visions of ORS 79.0311 (2), 446.611 or 446.626. If atransfer statement is presented with the applicablefee and request form to the official or office respon-sible for maintaining the system, the official or of-fice shall:

(a) Accept the transfer statement;(b) Promptly amend its records to reflect the

transfer; and(c) If applicable, issue a new appropriate certif-

icate of title in the name of the transferee.(3) A transfer of the record or legal title to

collateral to a secured party under subsection (2) ofthis section or otherwise is not of itself a dispositionof collateral under this chapter and does not of itselfrelieve the secured party of its duties under thischapter.

SECTION 20. Section 21 of this 2012 Act isadded to and made a part of the Oregon VehicleCode.

SECTION 21. “Special mobile equipment”means a vehicle that is not designed primarilyto transport persons or property, that is oper-ated on a highway only incidentally and that isused primarily on a farm, for timber productionand harvest, for construction work or for lawnand grounds care.

SECTION 22. ORS 803.030 is amended to read:803.030. This section establishes exemptions from

the requirements under ORS 803.025 to obtain titleissued by this state. The exemptions are subject toORS 803.040. The exemptions are in addition to anyexemptions under ORS 801.026. Vehicles exemptedby this section from the requirements to be titled bythis state are not prohibited from being titled by thisstate if titling is permitted under ORS 803.035. Theexemptions are partial or complete as provided inthe following:

(1) Title from this state is not required for a ve-hicle unless the vehicle is operated on a highway inthis state.

(2) Title from this state is not required unless avehicle is operated under a registration number ofthis state.

(3) Snowmobiles and Class I, Class III and ClassIV all-terrain vehicles are not subject to the re-quirements under ORS 803.025. The requirementsand procedures for titling snowmobiles are as pro-vided under ORS 821.060 and 821.070.

(4) Road rollers, farm tractors and traction en-gines are exempt from the requirements for title.

(5) Trolleys are exempt from the requirementsfor title.

(6) Bicycles are exempt from the requirementsfor title.

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(7) United States Government owned and oper-ated motor vehicles and trailers are exempt from therequirements for title.

(8) Implements of husbandry, well drilling ma-chinery, emergency fire apparatus providing publicfire protection and wheelchairs are exempt from therequirements for title.

(9) Except as provided in subsection (23) of thissection, fixed load vehicles are exempt from the re-quirements for title while operated within the im-mediate construction project, as described in thegovernmental agency contract, in the constructionor reconstruction of state or county roads, highwaysor city streets.

(10) Motor vehicles designed to operate at aloaded weight over 8,000 pounds, trailers and equip-ment are exempt from requirements for title while:

(a) Owned, leased, contracted or requisitioned bythe State Forester, State Board of Forestry, theircontractors under ORS chapter 477, or the federalgovernment; and

(b) Being used for the purposes of forest pro-tection and fire suppression under ORS chapter 477or a similar federal statute, including movement ofthe vehicles to and from the work area.

(11) Farm trailers are exempt from requirementsfor title when the operation or movement of the ve-hicle upon the highways is incidental to its use inan agricultural operation.

(12) Golf carts operated under an ordinanceadopted under ORS 810.070 are exempt from re-quirements for title.

(13) Golf carts or similar vehicles are exemptfrom requirements for title when:

(a) They have not less than three wheels in con-tact with the ground;

(b) They have an unloaded weight of less than1,300 pounds;

(c) They are designed to be and are operated atnot more than 15 miles per hour; and

(d) They are operated by persons with disabili-ties.

(14) The nonresident owners of vehicles cur-rently registered and titled in any other country,state or territory may operate such vehicles over thehighways of this state without complying with thetitling requirements under ORS 803.025. All of thefollowing apply to this subsection:

(a) This subsection only provides an exemptionso long as the owner satisfactorily shows that theowner is not a resident of this state or has been aresident of this state for less than 30 days. For thepurpose of this paragraph, a person is a resident ofthis state if the person meets the residency require-ments described in ORS 803.200.

(b) The exemption under this subsection appliesto vehicles granted exemptions under ORS 802.500,802.520 or 826.005, unless otherwise provided underparagraph (c) of this subsection.

(c) Except as otherwise provided in this para-graph, a vehicle operated over the highways of thisstate for compensation or profit must comply withthe titling requirements under ORS 803.025 in the

same manner as required of nontitled vehicles. Thefollowing vehicles are not subject to this paragraph:

(A) Vehicles operated under reciprocal registra-tion exemptions established under ORS 802.500 or826.005.

(B) Vehicles operated under an exemption estab-lished under ORS 802.520.

(C) Vehicles that are proportionally registeredunder an agreement established under ORS 826.007,and according to the procedures established underORS 826.009 or 826.011.

(D) Any vehicle if duly registered and titled un-der the laws of the state or country of which theowner is a bona fide resident to the extent that inthe foreign country, state, territory or federal dis-trict where the owner resides like exemptions andprivileges are granted vehicles duly registered andtitled under the laws of this state and owned byresidents of this state.

(d) If no exemptions from titling requirementsare in effect under ORS 802.500, 802.520, 826.005 or826.007 with respect to another jurisdiction, any ve-hicle properly registered and titled in such other ju-risdiction and for which evidence of compliance issupplied shall receive, when operated in this state,the same exemptions, benefits and privileges grantedby such other jurisdictions to vehicles properly reg-istered and titled in this state. Reciprocity extendedunder this paragraph shall apply to commercial ve-hicles only when engaged exclusively in interstatecommerce.

(e) Any vehicle operated under dealer registra-tion plates issued by another state, country, prov-ince, territory or the District of Columbia is subjectto this subsection.

(15) Vehicle dealers issued certificates underORS 822.020 may use and operate untitled vehiclesas provided under ORS 822.040.

(16) Towing businesses issued certificates underORS 822.205 may tow untitled vehicles as providedunder ORS 822.210.

(17) Vehicle transporters issued certificates un-der ORS 822.310 may transport untitled vehicles asprovided in ORS 822.310.

(18) Untitled vehicles may be operated under trippermits described under ORS 803.600 or under per-mits described under ORS 803.610 to 803.625.

(19) Vehicles that are registered by the UnitedStates Department of State and that are owned oroperated by foreign nationals with diplomatic immu-nity are exempt from the requirements for title.

(20)(a) Vehicles that are registered under theproportional registration provisions of ORS chapter826 and are titled in a jurisdiction other than Ore-gon are exempt from the requirements for title.

(b) A trailer that is registered under the propor-tional registration provisions of ORS chapter 826and titled in a jurisdiction other than Oregon shallremain exempt from the requirements for title inOregon if the trailer is registered when the otherjurisdiction removes its exception to proportionalregistration requirements for the trailer.

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(21) Converter dollies and tow dollies are exemptfrom the requirements for title.

(22) Electric personal assistive mobility devicesare exempt from the requirements for title.

(23) Road machinery that is operated at the di-rection of a road authority is exempt from the re-quirements for title. The exemption under thissubsection also applies when the operation of roadmachinery upon a highway or an alley is incidentalto its use in a highway maintenance operation.

(24) Special mobile equipment is exempt fromthe requirements for title.

SECTION 23. ORS 803.097 is amended to read:803.097. (1) Except as provided in subsection (5)

of this section, the exclusive means for perfecting asecurity interest in a vehicle is by application fornotation of the security interest on the title in ac-cordance with this section. The application may ac-company the application for a title or may be madeseparately at any time prior to issuance of title andmust be accompanied by evidence of ownership asdefined by the Department of Transportation by ruleunless the department is in possession of evidenceof ownership when it receives the application. If titleto the vehicle has been issued in a form other thana certificate, and the title reflects a security inter-est, the application for perfection shall include au-thorization from the previous security interestholder for the new security interest to be recordedon the title. Authorization under this subsection isnot required if:

(a) A release of interest is submitted by the priorsecurity interest holder or the department is other-wise satisfied that the prior holder no longer holdsan interest or is otherwise not entitled to title to thevehicle;

(b) The security interest is being added to thetitle in conjunction with the cancellation of previoustitle or other action the department takes to correctownership information reflected on a title; or

(c) Title is being transferred by operation of law.(2) When the department processes an applica-

tion for a security interest the department shallmark on the application or otherwise indicate on therecord the date the application was first received bythe department. The department shall determine byrule what constitutes receipt of an application forpurposes of this subsection.

(3) If the department has the evidence requiredby subsection (1) of this section and if the applica-tion contains the name of each owner of the vehicle,the name and address of the secured party and thevehicle identification number of the collateral, thesecurity interest is perfected as of the date markedon the application or indicated in the record by thedepartment. If the application does not contain theinformation required by this subsection, or if thedepartment does not have the required evidence, thedepartment shall indicate on the application or onthe record that the date placed on the applicationor the record pursuant to subsection (2) of this sec-

tion is not the date of perfection of the security in-terest.

(4) The security interest remains effective untilreleased or terminated by the secured party.

(5) A security interest in a vehicle may not beperfected as described under this section but is sub-ject to the perfection provisions under ORS chapter79 if:

(a) The debtor who granted the security interestis in the business of selling vehicles and the vehicleconstitutes inventory held for sale or lease[.]; or

(b) The vehicle is exempt from titling re-quirements under ORS 803.030.

SECTION 24. (1) Except as otherwise pro-vided in sections 21 and 24 to 31 of this 2012 Act,the amendments to statutes by sections 1 to 19,22 and 23 of this 2012 Act apply to a transactionor lien within the scope of ORS 79.0102, 79.0105,79.0208, 79.0307, 79.0311, 79.0316, 79.0317, 79.0326,79.0335, 79.0406, 79.0408, 79.0503, 79.0507, 79.0515,79.0516, 79.0518, 79.0521, 79.0607, 79.0619, 803.030and 803.097, as amended by sections 1 to 19, 22and 23 of this 2012 Act, even if the transactionor lien was entered into or created before theoperative date specified in section 32 of this 2012Act.

(2) The amendments to statutes by sections1 to 19, 22 and 23 of this 2012 Act do not affectan action, case or proceeding commenced beforethe operative date specified in section 32 of this2012 Act.

SECTION 25. (1) A security interest that isa perfected security interest immediately beforethe operative date specified in section 32 of this2012 Act is a perfected security interest undersection 21 of this 2012 Act and under ORS79.0102, 79.0105, 79.0208, 79.0307, 79.0311, 79.0316,79.0317, 79.0326, 79.0335, 79.0406, 79.0408, 79.0503,79.0507, 79.0515, 79.0516, 79.0518, 79.0521, 79.0607,79.0619, 803.030 and 803.097, as amended bysections 1 to 19, 22 and 23 of this 2012 Act, ifafter the operative date specified in section 32of this 2012 Act the applicable requirements forattachment and perfection under the amend-ments to statutes by sections 1 to 19, 22 and 23of this 2012 Act are satisfied without furtheraction.

(2) Except as otherwise provided in section27 of this 2012 Act, if immediately before theoperative date specified in section 32 of this 2012Act a security interest is a perfected securityinterest but the applicable requirements forperfection under the amendments to statutes bysections 1 to 19, 22 and 23 of this 2012 Act arenot satisfied on or before the operative datespecified in section 32 of this 2012 Act, the se-curity interest remains perfected thereafter onlyif the applicable requirements for perfection un-der the amendments to statutes by sections 1 to19, 22 and 23 of this 2012 Act are satisfied within

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one year after the operative date specified insection 32 of this 2012 Act.

SECTION 26. A security interest that is anunperfected security interest immediately beforethe operative date specified in section 32 of this2012 Act becomes a perfected security interest:

(1) Without further action on or after theoperative date specified in section 32 of this 2012Act if the applicable requirements for perfectionunder the amendments to statutes by sections 1to 19, 22 and 23 of this 2012 Act are satisfied be-fore or at that time; or

(2) When the applicable requirements forperfection are satisfied if the requirements aresatisfied after that time.

SECTION 27. (1) The filing of a financingstatement before the operative date specified insection 32 of this 2012 Act is effective to perfecta security interest to the extent that the filingwould satisfy the applicable requirements forperfection under the amendments to statutes bysections 1 to 19, 22 and 23 of this 2012 Act.

(2) The amendments to statutes by sections1 to 19, 22 and 23 of this 2012 Act do not renderineffective an effective financing statement that,before the operative date specified in section 32of this 2012 Act, is filed and satisfies the appli-cable requirements for perfection under the lawof jurisdiction governing perfection as providedin ORS 79.0102, 79.0105, 79.0208, 79.0307, 79.0311,79.0316, 79.0317, 79.0326, 79.0335, 79.0406, 79.0408,79.0503, 79.0507, 79.0515, 79.0516, 79.0518, 79.0521,79.0607, 79.0619, 803.030 and 803.097 as thosestatutes existed before the operative date speci-fied in section 32 of this 2012 Act. However, ex-cept as otherwise provided in subsections (3) and(4) of this section and in section 28 of this 2012Act, the financing statement ceases to be effec-tive:

(a) If the financing statement is filed in thisstate, at the time the financing statement wouldhave ceased to be effective had section 21 of this2012 Act and the amendments to ORS 79.0102,79.0105, 79.0208, 79.0307, 79.0311, 79.0316, 79.0317,79.0326, 79.0335, 79.0406, 79.0408, 79.0503, 79.0507,79.0515, 79.0516, 79.0518, 79.0521, 79.0607, 79.0619,803.030 and 803.097 by sections 1 to 19, 22 and 23of this 2012 Act not become operative; or

(b) If the financing statement is filed in an-other jurisdiction, at the earlier of:

(A) The time the financing statement wouldhave ceased to be effective under the law of theother jurisdiction; or

(B) June 30, 2018.(3) The filing of a continuation statement

after the operative date specified in section 32of this 2012 Act does not continue the effective-ness of a financing statement filed before theoperative date specified in section 32 of this 2012Act. However, upon the timely filing of a con-tinuation statement after the operative date

specified in section 32 of this 2012 Act and inaccordance with the law of the jurisdiction gov-erning perfection as provided in the amend-ments to statutes by sections 1 to 19, 22 and 23of this 2012 Act, the effectiveness of a financingstatement filed in the same office in the juris-diction before the operative date specified insection 32 of this 2012 Act continues for the pe-riod provided by the law of the jurisdiction.

(4) Subsection (2)(b)(B) of this section appliesto a financing statement that, before the opera-tive date specified in section 32 of this 2012 Act,is filed against a transmitting utility and satis-fies the applicable requirements for perfectionunder the law of the jurisdiction governing per-fection as provided in ORS 79.0102, 79.0105,79.0208, 79.0307, 79.0311, 79.0316, 79.0317, 79.0326,79.0335, 79.0406, 79.0408, 79.0503, 79.0507, 79.0515,79.0516, 79.0518, 79.0521, 79.0607, 79.0619, 803.030and 803.097, as those statutes existed before theoperative date specified in section 32 of this 2012Act, only to the extent that the amendments tostatutes by sections 1 to 19, 22 and 23 of this2012 Act provide that the law of a jurisdictionother than the jurisdiction in which the financ-ing statement is filed governs perfection of asecurity interest in collateral covered by the fi-nancing statement.

(5) A financing statement that includes a fi-nancing statement filed before the operativedate specified in section 32 of this 2012 Act anda continuation statement filed before the opera-tive date specified in section 32 of this 2012 Actis effective only to the extent that the financingstatement satisfies the requirements of ORS79.0503, 79.0515, 79.0516, 79.0518 and 79.0521, asamended by sections 12, 14, 15, 16 and 17 of this2012 Act, for an initial filing statement. A fi-nancing statement that indicates that thedebtor is a decedent’s estate indicates that thecollateral is being administered by a personalrepresentative within the meaning of ORS79.0503 (1)(b), as amended by section 12 of this2012 Act. A financing statement that indicatesthat the debtor is a trust or is a trustee actingwith respect to property held in trust indicatesthat the collateral is held in a trust within themeaning of ORS 79.0503 (1)(c), as amended bysection 12 of this 2012 Act.

SECTION 28. (1) The filing of an initial filingstatement in the office specified in ORS 79.0501continues the effectiveness of a financing state-ment filed before the operative date specified insection 32 of this 2012 Act if:

(a) The filing of an initial financing state-ment in the office would be effective to perfecta security interest under the amendments tostatutes by sections 1 to 19, 22 and 23 of this2012 Act;

(b) The financing statement filed before theoperative date specified in section 32 of this 2012Act was filed in an office in another state; and

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(c) The initial financing statement satisfiesthe provisions of subsection (3) of this section.

(2) The filing of an initial financing state-ment under subsection (1) of this section con-tinues the effectiveness of the financingstatement filed before the operative date speci-fied in section 32 of this 2012 Act:

(a) If the initial financing statement is filedbefore the operative date specified in section 32of this 2012 Act, for the period provided in ORS79.0515, as that statute existed before the oper-ative date specified in section 32 of this 2012 Act,with respect to an initial financing statement;and

(b) If the initial financing statement is filedafter the operative date specified in section 32of this 2012 Act, for the period provided in ORS79.0515, as amended by section 14 of this 2012Act, with respect to an initial financing state-ment.

(3) To be effective for purposes of subsection(1) of this section, an initial financing statementmust:

(a) Satisfy the requirements of ORS 79.0501to 79.0528 for an initial financing statement;

(b) Identify the financing statement that wasfiled before the operative date specified in sec-tion 32 of this 2012 Act by indicating the officein which the financing statement was filed andproviding the dates of filing and file numbers, ifany, of the financing statement and of the mostrecent continuation statement filed with respectto the financing statement; and

(c) Indicate that the financing statementfiled before the operative date specified in sec-tion 32 of this 2012 Act remains effective.

SECTION 29. (1) After the operative datespecified in section 32 of this 2012 Act, a personmay add or delete collateral covered by, con-tinue or terminate the effectiveness of, or oth-erwise amend the information provided in afinancing statement filed before the operativedate specified in section 32 of this 2012 Act onlyin accordance with the law of the jurisdictiongoverning perfection as provided in the amend-ments to statutes by sections 1 to 19, 22 and 23of this 2012 Act. However, the effectiveness of afinancing statement filed before the operativedate specified in section 32 of this 2012 Act mayalso be terminated in accordance with the lawof the jurisdiction in which the financing state-ment is filed.

(2) Except as otherwise provided in subsec-tion (3) of this section, if the law of this stategoverns perfection of a security interest, the in-formation in a financing statement filed beforethe operative date specified in section 32 of this2012 Act may be amended after the operativedate specified in section 32 of this 2012 Act onlyif:

(a) The financing statement filed before theoperative date specified in section 32 of this 2012

Act and an amendment are filed in the officespecified in ORS 79.0501;

(b) An amendment is filed in the office spec-ified in ORS 79.0501 concurrently with or afterthe filing in the office of an initial financingstatement that satisfies section 28 (3) of this2012 Act; or

(c) An initial financing statement that pro-vides the information as amended and satisfiessection 28 (3) of this 2012 Act is filed in the officespecified in ORS 79.0501.

(3) If the law of this state governs perfectionof a security interest, the effectiveness of a fi-nancing statement filed before the operativedate specified in section 32 of this 2012 Act maybe continued only under section 27 (3) and (5) or28 of this 2012 Act.

(4) Whether or not the law of this stategoverns perfection of a security interest, the ef-fectiveness of a financing statement filed in thisstate before the operative date specified in sec-tion 32 of this 2012 Act may be terminated afterthe operative date specified in section 32 of this2012 Act by filing a termination statement in anoffice in which the financing statement filed be-fore the operative date specified in section 32 ofthis 2012 Act is filed unless an initial financingstatement that satisfies section 28 (3) of this2012 Act has been filed in the office specified asthe office in which to file a financing statementby the law of the jurisdiction governing per-fection as provided in the amendments to stat-utes by sections 1 to 19, 22 and 23 of this 2012Act.

SECTION 30. A person may file an initial fi-nancing statement or a continuation statementunder sections 24 to 31 of this 2012 Act if:

(1) The secured party of record authorizesthe filing; and

(2) The filing is necessary under sections 24to 31 of this 2012 Act:

(a) To continue the effectiveness of a fi-nancing statement filed before the operativedate specified in section 32 of this 2012 Act; or

(b) To perfect or continue the perfection ofa security interest.

SECTION 31. Section 21 of this 2012 Act andthe amendments to ORS 79.0102, 79.0105, 79.0208,79.0307, 79.0311, 79.0316, 79.0317, 79.0326, 79.0335,79.0406, 79.0408, 79.0503, 79.0507, 79.0515, 79.0516,79.0518, 79.0521, 79.0607, 79.0619, 803.030 and803.097 by sections 1 to 19, 22 and 23 of this 2012Act determine the priority of conflicting claimsto collateral. However, if the relative prioritiesof the claims were established before the opera-tive date specified in section 32 of this 2012 Act,ORS 79.0102, 79.0105, 79.0208, 79.0307, 79.0311,79.0316, 79.0317, 79.0326, 79.0335, 79.0406, 79.0408,79.0503, 79.0507, 79.0515, 79.0516, 79.0518, 79.0521,79.0607, 79.0619, 803.030 and 803.097, as thosestatutes existed before the operative date speci-

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fied in section 32 of this 2012 Act, determinepriority.

SECTION 32. Section 21 of this 2012 Act andthe amendments to ORS 79.0102, 79.0105, 79.0208,79.0307, 79.0311, 79.0316, 79.0317, 79.0326, 79.0335,79.0406, 79.0408, 79.0503, 79.0507, 79.0515, 79.0516,79.0518, 79.0521, 79.0607, 79.0619, 803.030 and803.097 by sections 1 to 19, 22 and 23 of this 2012Act become operative July 1, 2013.

SECTION 33. The section captions used inthis 2012 Act are provided only for the conven-

ience of the reader and do not become part ofthe statutory law of this state or express anylegislative intent in the enactment of this 2012Act.

SECTION 34. This 2012 Act being necessaryfor the immediate preservation of the publicpeace, health and safety, an emergency is de-clared to exist, and this 2012 Act takes effect onits passage.

Approved by the Governor March 5, 2012Filed in the office of Secretary of State March 5, 2012Effective date March 5, 2012

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Documents

OREGON LAWS 2012 Chap. 12 · OREGON LAWS 2012 Chap. 12 (B) Indicates that it is a continuation statement for, or that it is filed to continue the effectiveness of, the identified