December 17, 2010
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Question:
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Ken,
Maybe this has been discussed, but what about systems that are lower cost $0, or system even $500 which have been paid for but customers have defaulted on monitoring 1 month, 6 months or a year later. Can UCC be filed just for monitoring?
Thanks
HSS
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Answer:
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Short answer. yes.
The UCC, which stands for the Uniform Commercial Code, governs the law of merchants. Someone who owes you money, or who will owe you money, can give you a security interest in property to secure the past, current or future obligation. The security interest is granted in a Security Agreement. In the my Standard Form Contracts I have a provision whereby the subscriber grants you a security interest in property owned by the subscriber. For residential subscribers the security interest extends to the equipment installed. For commercial subscribers the security interest extends to all personal property owned by the subscriber, both tangible and intangible.
Once you are granted the security interest you then have to [usually] perfect that interest by filing a notice, which is a UCC-1 financing statement. It's filed centrally in each state.
You can file that UCC-1 at any time after you are granted the security interest and until the potential for debt is extinguished.
For more info on UCC option see articles at
http://www.kirschenbaumesq.com/earticle43.htm