A132

ASSEMBLY, No. 132

STATE OF NEW JERSEY

Introduced Pending Technical Review by Legislative Counsel

PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION

By Assemblyman JONES

An Act concerning filed financing statements and amending N.J.S.12A:9-403.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. N.J.S.12A:9-403 is amended to read as follows:

12A:9-403 Filing of financing statement.

(1) Presentation for filing of a financing statement, tender of the filing fee and acceptance of the statement by the filing officer constitute filing under this chapter.

(2) Except as provided in subsection (6) a filed financing statement is effective for [a] the period of [five years from the date of filing] time indicated on the financing statement by which the registration is effected. The effectiveness of a filed financing statement lapses on the expiration of the [five-year] period of time indicated on the filed financing statement unless a continuation statement is filed prior to the lapse. If a security interest perfected by filing exists at the time insolvency proceedings are commenced by or against the debtor, the security interest remains perfected until termination of the insolvency proceedings and thereafter for a period of 60 days or until expiration of the [five-year] period of time indicated on the filed financing statement, whichever occurs later. Upon lapse the security interest becomes unperfected, unless it is perfected without filing. If the security interest becomes unperfected upon lapse, it is deemed to have been unperfected as against a person who became a purchaser or lien creditor before lapse.

(3) A continuation statement may be filed by the secured party within six months prior to the expiration of the [five-year] time period specified in subsection (2). Any such continuation statement [must] shall be signed by the secured party, identify the original statement by file number and state that the original statement is still effective. A continuation statement signed by a person other than the secured party of record [must] shall be accompanied by a separate written statement of assignment signed by the secured party of record and complying with subsection (2) of 12A:9-405, including payment of the required fee.

Upon timely filing of the continuation statement, the effectiveness of the original statement is continued for [five years after the last date to which the filing was effective] the period of time indicated on the continuation statement whereupon it lapses in the same manner as provided in subsection (2) unless another continuation statement is filed prior to such lapse. Succeeding continuation statements may be filed in the same manner to continue the effectiveness of the original statement. The filing officer shall [so arrange matters by physical annexation of] attach financing statements to continuation statements or other related filings[, or by other means, that if he physically destroys the financing statements of a period more than five years past, those which have been continued by a continuation statement or which are still effective under subsection (6) shall be retained].

(4) Except as provided in subsection (7), a filing officer shall mark each statement with a file number [and with] , the date and hour of filing, and the period of time for which the statement is effective and shall hold the statement or a microfilm or other photographic copy thereof for public inspection. In addition, the filing officer shall index the statements according to the name of the debtor and shall note in the index the file number and the address of the debtor given in the statement and the period of time for which the statement is effective. A financing statement covering collateral which is or is to become a fixture or fixtures, or crops growing or to be grown, shall also be indexed in the name of the record owner of the realty.

(5) The uniform fee for filing, indexing and furnishing filing data for an original or a continuation statement or any amendment of either shall be[$25.00.]as follows:

(a) for an original or continuation statement:

(i) 1 through 25 year filing option (per year) $5

(ii) infinite filing life option $500

(b) for an amendment $25

(6) A real estate mortgage which is effective as a fixture filing under subsection (6) of 12A:9-402 remains effective as a fixture filing until the mortgage is released or satisfied of record or its effectiveness otherwise terminates as to the real estate.

(7) When a financing statement covers timber to be cut or covers minerals or the like (including oil and gas) or accounts subject to subsection (5) of 12A:9-103, or is filed as a fixture filing, it shall be filed for record and the filing officer shall index it under the names of the debtor and any owner of record shown on the financing statement in the same fashion as if they were the mortgagors in a mortgage of the real estate described, and, to the extent that the law of this State provides for indexing of mortgages under the name of the mortgagee, under the name of the secured party as if he were the mortgagee thereunder, or where indexing is by description in the same fashion as if the financing statement were a mortgage of the real estate described.

(cf: P.L.1987, c.435, s.4)

2. This act shall take effect on the first day of the month immediately following 90 days after the date of enactment.

STATEMENT

This bill provides options to the person filing a financing statement to perfect a security interest under Article 9 of the Uniform Commercial Code. Under the bill, the person filing a financing statement would have to write on the financing statement the number of years for which the financing statement shall be effective, from one through 25, or indicate infinite. The bill provides fees in an amount of $5 per year written on the financing statement or if the person filing the statement choses the category of infinite, the fee amount charged would be $500. The bill also provides the opportunity to continue a financing statement, if the initial period of time written on the financing statement was not sufficient.

Concerns the duration of and fees for filed financing statements.