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 How does the new law change the rules?

West Virginia Uniform Commercial Code Law

The West Virginia Uniform Commercial Code - Secured Transactions law, Chapter 46, Article 9 of the West Virginia Code, entirely replaced the former commercial code in West Virginia in 2001, and included important changes in filing requirements. For "frequent filers," these are some of the key changes in filing requirements:

Where Filings are Made

  • Financing statements filed on consumer goods, commercial and farm property which are not fixture filings are filed only with the Secretary of State, and not with a county clerk as well.
  • Financing statements on goods which are to become fixtures may be filed as fixture filings with the county clerk, or as ordinary goods with the Secretary of State only.

Changes in Signatures

  • The new law provides for "notice filings." The financing statement is not the legal agreement between the parties, but only indicates that the secured party may have a security interest in the collateral.
  • A debtor's signature on the initial financing statement or amendment is not required. However, the filing is lawful only if the debtor authorizes the filing.
  • The secured party's signature is not required on a termination statement. However, the filing is lawful only if the secured party authorizes that filing.

Changes in Contents of Filing

  • The requirements for the name of the debtor are much stricter, and the filing officer is obligated to reject filings if the name cannot be determined.
  • For a person's name, the filing officer must be able to tell which is the last name to assure proper indexing.
  • The name given for a debtor which is a registered organization must match the name on the public record of its organization. For example, if the business organization records list the official business name as "Wyatt Brothers, PLLC" and the debtor name was listed as "Wyatt and Wyatt Law Firm", the filing might not be effective.
  • The debtor's trade name alone is not sufficient. Listing trade names in addition to the official name is acceptable, but is not required.
  • In addition to the debtor's name, the filing must include the debtor's mailing address and whether the debtor is an individual or an organization. If the debtor is an organization, the type of organization, jurisdiction of the organization, and the organization's filing number or a statement that they have none. (NOTE: West Virginia business organizations registered with the Secretary of State are not assigned numbers. Their tax numbers are not public information.)

Changes in Term of Financing Statement

  • The term remains five years for a UCC financing statement for ordinary collateral. The secured party has the right to continue (extend) it for additional five-year periods until the debt is paid. 
  • The term has changed from five to forty years for a financing statement designated as a manufactured-home transaction.
  • The term has changed from perpetual to forty years for a financing statement designated as a public-financing transaction (a transaction in which debt securities, such as bonds, are issued and at least part of the securities have a maturity of at least twenty years and involve a governmental unit as a debtor, secured party, assignor or assignee)
  • The term remains perpetual for a financing statement of property of a transmitting utility (including persons operating railroads, transmitting electricity, steam, gas, or water, transmitting goods by pipeline or sewer, or transmitting communications).
  • Fixture filings which are designated as such and related to a real estate transaction remain in effect for the duration of the lien or mortgage on the real estate.