Perfecting Security Interests in a Debtor's Insurance Policy

The First Circuit Bankruptcy Appellate Panel (BAP) in In re Montreal, Maine & Atlantic Railway Ltd alerts secured creditors to the risk of draconian results from not properly perfecting security interests in a debtor's insurance proceeds. This article will first provide a brief primer on th...

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Bibliographic Details
Published inAmerican Bankruptcy Institute journal Vol. 34; no. 4; p. 22
Main Author Birney, Patrick M
Format Journal Article
LanguageEnglish
Published Alexandria American Bankruptcy Institute 01.04.2015
Subjects
Bankruptcy
Business interruption insurance
Collateral
Creditors
Federal court decisions
Federal courts
Insurance coverage
Insurance industry
Insurance policies
Personal property
Railway networks
Receivables
Security interests
State court decisions
Uniform Commercial Code-US
United States > US
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Summary:The First Circuit Bankruptcy Appellate Panel (BAP) in In re Montreal, Maine & Atlantic Railway Ltd alerts secured creditors to the risk of draconian results from not properly perfecting security interests in a debtor's insurance proceeds. This article will first provide a brief primer on the provisions of UCC Article 9 that were at the center of the BAP and bankruptcy court decisions. It will then examine the BAP and bankruptcy court decisions. The article will conclude with some practice tips for secured creditors who intend to perfect a security interest in a debtor's insurance proceeds. UCC Article 9 is the body of nonbankruptcy law generally implicated when a creditor and debtor seek to utilize the debtor's personal property as collateral to secure loan repayment obligations. Revised Article 9, like its predecessor, provides the mechanism for attaching and perfecting security interests on personal property collateral.
ISSN:1931-7522