In Re Xxxxxx Sample Clauses

In Re Xxxxxx. Xxxxxx bought refrigerator from Sight ‘N Sound using store credit card – Signed credit card agreement: Sight ‘N Sound “will have a purchase money security interest in all merchandise” purchased with the card – Xxxxxx went bankrupt • Court (p. 153): “all merchandise” didn’t adequately describe refrigerator. Do you agree? Is Xxxxxx Sound? • Case is wrongly decided (seriously so) – “All” merchandise purchased on the card isn’t really ambiguous, esp. if creditor presents extrinsic proof showing Xxxxxx purchased the refrigerator using the card – Subsequent invoice describing the refrigerator would be part of the “security agreement” under the composite documents rule • Xxxxxx court states [p. 154]: “It is understandable for a creditor to desire one catchall phrase which creates a security agreement in every possible situation. However, in doing so, it may not ignore one of the primary reasons for creating a security agreement, which is to give notice to a third party.” • What’s wrong with this statement? Xxxxxx/The Security Agreement • The purpose of a security agreement is to create a security interest — NOT to give notice to 3rd parties – Security agreements aren’t even recorded! • Financing statements (UCC-1s) give notice – Third parties dealing with the debtor will rely upon the collateral description in the UCC-1! DEBTOR XXXX 000 XXXX XXXXXX ANYTOWN XX 99010 FIRST BANK 5 BROADWAY ANYTOWN XX 99002 DEBTOR’S INVENTORY AND EQUIPMENT Notice to 3rd Parties? • Suppose Second Bank was considering a loan to Xxxx Xxxxxx, to be secured by Xxxx’s computer – Xxxx says: my computer isn’t covered by First Bank’s security agreement – Second Bank reads First Bank’s security agreement, and it doesn’t cover Xxxx’s computer • Can Second Bank be assured of priority if it then makes a loan to Xxxx and takes SI in his computer? Notice to 3rd Parties? • NO! At some later date, Xxxx might xxxxx First Bank a new security interest in the computer – If Xxxx does so, First Bank’s already-filed UCC-1 financing statement would be sufficient to perfect that security interest! – And, based on first-to-file-or-perfect, First Bank would then have priority over Second Bank with respect to the computer [§ 9-322(a)(1)] Problem 9.2 • How should Xxxxxx’x adapt to avoid Xxxxxx? – Turn each credit card charge slip into a separate security agreement, have it describe item (by make, model, etc.) and grant SI in that item – Easily done now, w/computerized systems – When customer signs (authenticates)...

In Re Xxxxxx. [1897] 1 IR 575 the deceased had guaranteed the current account of a firm. Xxxxxx died in April 1895 but the bank did not find out until November and the account was not closed until January 1896. The issue to be determined by the court was whether Whelan’s estate were liable for amounts overdrawn on the account after his death. The Court held that advances made after his death but before the bank became aware of his death were recoverable, but those made after the bank was made aware were not. Counter offers An acceptance must be unequivocal; if different terms are proposed, this is regarded as a counter offer, which rejects the first offer. A counter-offer will amount to a rejection of the original offer. In many in-stances rejection may be accompanied by an offer with new terms. XxXxxxxxx acknowledges that “[i]f the response to the offer is anything less than a clear and unequivocal acceptance of the exact terms of the offer, then the response will be seen as a counter-offer.”

In Re Xxxxxx. Shoe Company (charitable pledge enforced because relied upon in using pledge it to get other pledges)