2009 California Civil Code - Section 3440-3440.9 :: Chapter 2. Conveyance Of Personal Property Without Delivery

CIVIL CODE
SECTION 3440-3440.9

3440.  (a) Except as otherwise provided in this chapter, every
transfer of personal property made by a person having at the time the
possession of the property, and not accompanied by an immediate
delivery followed by an actual and continued change of possession of
the property, is void as against the transferor's creditors (secured
or unsecured) at the time of the transfer and those who become
creditors while the transferor remains in possession and the
successors in interest of those creditors, and as against buyers from
the transferor for value in good faith subsequent to the transfer.
   (b) As used in this chapter, "creditor" means a person who has a
claim, as defined in Section 3439.01, and includes an assignee of a
general assignment for the benefit of creditors, as defined in
Section 493.010 of the Code of Civil Procedure, of a debtor.
"Creditor" also includes any person to whom the transferor's estate
devolves in trust for the benefit of persons other than the
transferor. Any such assignee or trustee may exercise any and all the
rights and remedies specified in this chapter, if they are available
to any one or more creditors of the assignor or transferor who are
beneficiaries of the assignment or trust, and, in that event (1) only
to the extent the rights or remedies are so available and (2) only
for the benefit of those creditors whose rights are asserted by the
assignee or trustee.

3440.1.  This chapter does not apply to any of the following:
   (a) Things in action.
   (b) Ships or cargoes if either are at sea or in a foreign port.
   (c) The sale of accounts, chattel paper, payment intangibles, or
promissory notes governed by the Uniform Commercial Code, security
interests, and contracts of bottomry or respondentia.
   (d) Wines or brandies in the wineries, distilleries, or wine
cellars of the makers or owners of the wines or brandies, or other
persons having possession, care, and control of the wines or
brandies, and the pipes, casks, and tanks in which the wines or
brandies are contained, if the transfers are made in writing and
executed and acknowledged, and if the transfers are recorded in the
book of official records in the office of the county recorder of the
county in which the wines, brandies, pipes, casks, and tanks are
situated.
   (e) A transfer or assignment made for the benefit of creditors
generally or by any assignee acting under an assignment for the
benefit of creditors generally.
   (f) Property exempt from enforcement of a money judgment.
   (g) Standing timber.
   (h) Subject to the limitations in Section 3440.3, a transfer of
personal property if all of the following conditions are satisfied:
   (1) Prior to the date of the intended transfer, the transferor or
the transferee files a financing statement, with respect to the
property transferred, signed by the transferor. The financing
statement shall be filed in the office of the Secretary of State in
accordance with Chapter 5 (commencing with Section 9501) of Division
9 of the Commercial Code, but may use the terms "transferor" in lieu
of "debtor" and "transferee" in lieu of "secured party." The
provisions of Chapter 5 (commencing with Section 9501) of Division 9
of the Commercial Code shall apply as appropriate to the financing
statement.
   (2) The transferor or the transferee publishes a notice of the
intended transfer one time in a newspaper of general circulation
published in the judicial district in which the personal property is
located, if there is one, and if there is none in the judicial
district, then in a newspaper of general circulation in the county
embracing the judicial district. The publication shall be completed
not less than 10 days before the date the transfer occurs. The notice
shall contain the name and address of the transferor and transferee
and a general statement of the character of the personal property
intended to be transferred, and shall indicate the place where the
personal property is located and a date on or after which the
transfer is to be made.
   (i) Personal property not located within this state at the time of
the transfer or attachment of the lien if the provisions of this
subdivision are not used for the purpose of evading this chapter.
   (j) A transfer of property that (1) is subject to a statute or
treaty of the United States or a statute of this state that provides
for the registration of transfers of title or issuance of
certificates of title and (2) is so far perfected under that statute
or treaty that a bona fide purchaser cannot acquire an interest in
the property transferred that is superior to the interest of the
transferee.
   (k) A transfer of personal property in connection with a
transaction in which the property is immediately thereafter leased by
the transferor from the transferee provided the transferee purchased
the property for value and in good faith (subdivision (c) of Section
10308 of the Commercial Code).
   (l) Transition property, as defined in Section 840 of the Public
Utilities Code, or recovery property, as defined in Section 848 of
the Public Utilities Code.
   (m) A transfer of property by any governmental entity.

3440.2.  Subject to Section 3440.3, a transfer of personal property
shall not be void under Section 3440 as against a creditor of the
transferor or as against a buyer from the transferor, if the creditor'
s or buyer's claim or right against the transferor arises after the
date all of the requirements of subdivision (h) of Section 3440.1
have been met, other than the requirement that filing of the
financing statement and publication of the notice referred to therein
be completed prior to the transfer.

3440.3.  A transfer of personal property, as to which the conditions
set forth in subdivision (h) of Section 3440.1, Section 3440.2, or
subdivision (b) of Section 3440.5 are satisfied, shall, nevertheless,
be void under Section 3440 as against a person who has purchased the
personal property from the transferor and who is a "buyer in the
ordinary course of business," as defined in paragraph (9) of
subdivision (b) of Section 1201 of the Commercial Code.

3440.4.  This chapter does not affect the rights of a buyer for
value in good faith who purchases the transferred personal property
from the transferee or from a successor in interest of the
transferee, provided the transferor is no longer in possession of the
personal property at the time of the purchase by that buyer.

3440.5.  (a) This chapter does not affect the rights of a secured
party who, for value and in good faith, acquires a security interest
in the transferred personal property from the transferee, or from the
transferee's successor in interest, if the transferor is no longer
in possession of the personal property at the time the security
interest attaches.
   (b) Additionally, except as provided in Section 3440.3, this
chapter does not affect the rights of a secured party who acquires a
security interest from the transferee, or from the transferee's
successor in interest, in the personal property, if all of the
following conditions are satisfied:
   (1) On or before the date the security agreement is executed, the
intended debtor or secured party files a financing statement with
respect to the property transferred, signed by the intended debtor.
The financing statement shall be filed in the office of the Secretary
of State in accordance with Chapter 5 (commencing with Section 9501)
of Division 9 of the Commercial Code, but shall use the terms
"transferor" in lieu of "debtor," "transferee" in lieu of "secured
party," and "secured party" in lieu of "assignee of secured party."
The provisions of Chapter 5 (commencing with Section 9501) of
Division 9 of the Commercial Code shall apply as appropriate to such
a statement. For the purpose of indexing, and in any certification of
search, the Secretary of State may refer to any financing statement
filed pursuant to this paragraph as a financing statement under the
Commercial Code and may describe the transferor as a debtor and the
transferee as a secured party.
   Compliance with this paragraph shall, however, not perfect the
security interest of the secured party. Perfection of such a security
interest shall be governed by Division 9 (commencing with Section
9101) of the Commercial Code.
   (2) The intended debtor or secured party publishes a notice of the
transfer one time in a newspaper of general circulation published in
the judicial district in which the personal property is located, if
there is one, and if there is none in the judicial district, then in
a newspaper of general circulation in the county embracing the
judicial district. The publication shall be completed not less than
10 days before the date of execution by the intended debtor of the
intended security agreement. The notice shall contain the names and
addresses of the transferor and transferee and of the intended debtor
and secured party, a general statement of the character of the
personal property transferred and intended to be subject to the
security interest, the location of the personal property, and the
date on or after which the security agreement is to be executed by
the intended debtor.

3440.6.  No action shall be brought or levy made under this chapter
more than one year after the earliest of the following dates:
   (a) The date the person bringing the action or making the levy
should have discovered the transfer in the exercise of reasonable
diligence.
   (b) The date the person bringing the action or making the levy
obtained actual knowledge of the transfer.
   (c) The date the delivery of, and actual and continued change of
possession of, the property transferred occurred.
   (d) If the financing statement filed pursuant to subdivision (h)
of Section 3440.1 has not lapsed, the date the filing and publication
requirements of subdivision (h) of Section 3440.1 were met, other
than the requirement that the filing of the financing statement and
publication of the notice referred to therein be completed prior to
the transfer.

3440.9.  Subdivision (2) of Section 2402 and subdivision (a) of
Section 10308 of the Commercial Code are not restricted by the
provisions of this chapter.

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