SB2223 - Relating to amendments to the Uniform Commercial Code, including amendments concerning certain intangible assets and the perfection of security interests in those assets.

  89R13938 PRL-D     By: Parker S.B. No. 2223       A BILL TO BE ENTITLED   AN ACT   relating to amendments to the Uniform Commercial Code, including   amendments concerning certain intangible assets and the perfection   of security interests in those assets.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:   ARTICLE 1. GENERAL PROVISIONS          SECTION 1.01.  Section 1.201(b), Business & Commerce Code,   is amended by amending Subdivisions (10), (15), (21), (24), (27),   (33), (36), and (37) and adding Subdivision (16-a) to read as   follows:                (10)  "Conspicuous," with reference to a term, means so   written, displayed, or presented that , based on the totality of the   circumstances, a reasonable person against which it is to operate   ought to have noticed it. Whether a term is "conspicuous" or not is   a decision for the court. [ Conspicuous terms include the   following:                      [ (A)     a heading in capitals equal to or greater in   size than the surrounding text, or in contrasting type, font, or   color to the surrounding text of the same or lesser size; and                      [ (B)     language in the body of a record or display   in larger type than the surrounding text, or in contrasting type,   font, or color to the surrounding text of the same size, or set off   from surrounding text of the same size by symbols or other marks   that call attention to the language. ]                (15)  "Delivery," with respect to an electronic   document of title, means voluntary transfer of control, and with   respect to an instrument, a tangible document of title, or an   authoritative tangible copy of a record evidencing chattel paper,   means voluntary transfer of possession.                 (16-a)     "Electronic" means relating to technology   having electrical, digital, magnetic, wireless, optical,   electromagnetic, or similar capabilities.                (21)  "Holder" means:                      (A)  the person in possession of a negotiable   instrument that is payable either to bearer or to an identified   person that is the person in possession;                      (B)  the person in possession of a negotiable   tangible document of title if the goods are deliverable either to   bearer or to the order of the person in possession; or                      (C)  a person in control , other than pursuant to   Section 7.106(g), of a negotiable electronic document of title.                (24)  "Money" means a medium of exchange that is   currently authorized or adopted by a domestic or foreign   government. The term includes a monetary unit of account   established by an intergovernmental organization , or pursuant to an   [ by ] agreement between two or more countries. The term does not   include an electronic record that is a medium of exchange recorded   and transferable in a system that existed and operated for the   medium of exchange before the medium of exchange was authorized or   adopted by the government.                (27)  "Person" means an individual, corporation,   business trust, estate, trust, partnership, limited liability   company, association, joint venture, government, governmental   subdivision, agency, or instrumentality, or [ public corporation, ]   any other legal or commercial entity[ , or a protected series or   registered series of a for-profit entity ]. The term includes a   protected series or registered series, however denominated, of an   entity if the protected series or registered series is established   under law other than this title that limits, or limits if conditions   specified under the law are satisfied, the ability of a creditor of   the entity or of any other protected series or registered series of   the entity to satisfy a claim from assets of the protected series or   registered series.                (33)  "Representative" means a person empowered to act   for another, including an agent, an officer of an organization [ a   corporation or association ], and a trustee, executor, or   administrator of an estate.                (36)  "Send , " in connection with a [ writing, ] record[ , ]   or notification, [ notice ] means:                      (A)  to deposit in the mail , [ or ] deliver for   transmission , or transmit by any other usual means of   communication , with postage or cost of transmission provided for ,   [ and properly ] addressed [ and, in the case of an instrument, to an   address specified thereon or otherwise agreed, or if there be none ]   to any address reasonable under the circumstances; or                      (B)   to [ in any other way ] cause the record or   notification to be received [ any record or notice ] within the time   [ at which ] it would have been received [ arrived ] if properly sent   under Paragraph (A) .                (37)   "Sign" means, with present intent to authenticate   or adopt a record:                       (A)  execute or adopt a tangible symbol; or                       (B)     attach to or logically associate with the   record an electronic symbol, sound, or process.   "Signed , " "signing," and "signature" have corresponding meanings   [ includes using any symbol executed or adopted with present   intention to adopt or accept a writing ].          SECTION 1.02.  Section 1.204, Business & Commerce Code, is   amended to read as follows:          Sec. 1.204.  VALUE. Except as otherwise provided in   Chapters 3, 4, [ and ] 5, and 12A, a person gives value for rights if   the person acquires them:                (1)  in return for a binding commitment to extend   credit or for the extension of immediately available credit,   whether or not drawn upon and whether or not a charge-back is   provided for in the event of difficulties in collection;                (2)  as security for, or in total or partial   satisfaction of, a preexisting claim;                (3)  by accepting delivery under a preexisting contract   for purchase; or                (4)  in return for any consideration sufficient to   support a simple contract.          SECTION 1.03.  Section 1.301(b), Business & Commerce Code,   is amended to read as follows:          (b)  Where one of the following provisions of this title   specifies the applicable law, that provision governs and a contrary   agreement is effective only to the extent permitted by the law   (including the conflict of laws rules) so specified:          Rights of creditors against sold goods. Section 2.402.          Applicability of the chapter on Leases. Sections 2A.105 and   2A.106.          Applicability of the chapter on Bank Deposits and   Collections. Section 4.102.          Governing law in the chapter on Funds Transfers. Section   4A.507.          Letters of Credit. Section 5.116.          Applicability of the chapter on Investment Securities.   Section 8.110.          Law governing perfection, the effect of perfection or   nonperfection, and the priority of security interests and   agricultural liens. Sections 9.301-9.307.           Controllable electronic record. Section 12A.107.          SECTION 1.04.  Section 1.306, Business & Commerce Code, is   amended to read as follows:          Sec. 1.306.  WAIVER OF RENUNCIATION OF CLAIM OR RIGHT AFTER   BREACH. A claim or right arising out of an alleged breach may be   discharged in whole or in part without consideration by agreement   of the aggrieved party in a signed [ an authenticated ] record.   ARTICLE 2. SALES          SECTION 2.01.  Section 2.102, Business & Commerce Code, is   amended to read as follows:          Sec. 2.102.  SCOPE; CERTAIN SECURITY AND OTHER TRANSACTIONS   EXCLUDED FROM THIS CHAPTER. (a)   Unless the context otherwise   requires, and except as provided in Subsection (c), this chapter   applies to transactions in goods and, in the case of a hybrid   transaction, it applies to the extent provided in Subsection (b).           (b)  In a hybrid transaction:                 (1)     if the sale-of-goods aspects do not predominate,   only the provisions of this chapter which relate primarily to the   sale-of-goods aspects of the transaction apply, and the provisions   that relate primarily to the transaction as a whole do not apply; or                 (2)     if the sale-of-goods aspects predominate, this   chapter applies to the transaction but does not preclude   application in appropriate circumstances of other law to aspects of   the transaction which do not relate to the sale of goods.           (c)  This chapter [ ; it ] does not :                 (1)   apply to a [ any ] transaction that, even though   [ which although ] in the form of an unconditional contract to sell or   present sale , operates only to create a security interest; or                 (2)   [ is intended to operate only as a security   transaction nor does this chapter ] impair or repeal any statute   regulating sales to consumers, farmers , or other specified classes   of buyers.          SECTION 2.02.  The heading to Section 2.106, Business &   Commerce Code, is amended to read as follows:          Sec. 2.106.  DEFINITIONS: "CONTRACT"; "AGREEMENT";   "CONTRACT FOR SALE"; "SALE"; "PRESENT SALE"; "CONFORMING" TO   CONTRACT; "TERMINATION"; "CANCELLATION" ; "HYBRID TRANSACTION" .          SECTION 2.03.  Section 2.106, Business & Commerce Code, is   amended by adding Subsection (e) to read as follows:           (e)     "Hybrid transaction" means a single transaction   involving a sale of goods and:                 (1)  the provision of services;                 (2)  a lease of other goods; or                 (3)     a sale, lease, or license of property other than   goods.          SECTION 2.04.  Sections 2.201(a) and (b), Business &   Commerce Code, are amended to read as follows:          (a)  Except as otherwise provided in this section a contract   for the sale of goods for the price of $500 or more is not   enforceable by way of action or defense unless there is a record   [ some writing ] sufficient to indicate that a contract for sale has   been made between the parties and signed by the party against whom   enforcement is sought or by the party's [ his ] authorized agent or   broker. A record [ writing ] is not insufficient because it omits or   incorrectly states a term agreed upon but the contract is not   enforceable under this subsection [ paragraph ] beyond the quantity   of goods shown in the record [ such writing ].     &#xA [Text truncated for display. Full text available on LegiScan.]