The Impact of Revised Article 9 on Missouri's Fixture Financing Scheme
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In 1963, Missouri adopted the Uniform Commercial Code, including Article 9, which integrated the existing state laws governing the use of personal property as security. Since that time, significant revisions of Article 9 have been approved by the Code's national sponsors, representing substantial changes in the law of secured transactions. These revisions have been introduced in the Missouri legislature but have not yet been enacted. It seems reasonably certain that they will be enacted in the near future. The area that has been more extensively revised than any other is Article 9's treatment of security interests in fixtures. These revisions stem from widespread dissatisfaction with the original version's fixture provisions. "Fixtures" is a hybrid classification, encompassing chattels that have been connected with realty in such a manner that, while not losing their separate identity, they would be considered a part of the realty by a disinterested observer. Thus, fixtures have characteristics of both realty and personalty, and while they may be subject to Article 9 security interests, they may also be subject to the interests of a variety of other parties with rights in the real estate to which they are affixed. The Article 9 secured party may be competing for priority rights with prior or subsequent owners, mortgagees, or lien creditors, including a trustee in bankruptcy. Both versions of Article 9 set out a complex series of rules designed to resolve these potential conflicts, but there are major differences between the current and the revised Code. This Article examines the fixture provisions of both versions of the Code and comments on the changes made by the revisions. In the process, the Article examines Missouri's rather sketchy non-Code law of fixtures and discusses how this law interacts with both versions of the Code. In addition, the Article deals briefly with the interrelationship between the fixture provisions of Article 9 and relevant provisions of bankruptcy law. The Article was written at this time because of the adverse reaction generated in other states by the Code's original provisions. Fixtures fall at the nexus between real and personal property security systems, and had the Code's original rules been fully analyzed in terms of their impact on state real property regimes, much of the criticism could have been avoided. Before a new set of rules is enacted, it may be beneficial to examine Missouri's fixture scheme to determine whether the revisions are, in fact, advisable.
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