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355.9-109 Scope.
(1)
(2)
(3)
(4)
Except as otherwise provided in subsections (3) and (4) of this section, this article
applies to:
(a) A transaction, regardless of its form, that creates a security interest in personal
property or fixtures by contract;
(b) An agricultural lien;
(c) A sale of accounts, chattel paper, payment intangibles, or promissory notes;
(d) A consignment;
(e) A security interest arising under KRS 355.2-401, 355.2-505, 355.2-711(3), or
355.2A-508(5), as provided in KRS 355.9-110; and
(f) A security interest arising under KRS 355.4-210 or 355.5-118.
The application of this article to a security interest in a secured obligation is not
affected by the fact that the obligation is itself secured by a transaction or interest to
which this article does not apply.
This article does not apply to the extent that:
(a) A statute, regulation, or treaty of the United States preempts this article;
(b) Another statute of this Commonwealth expressly governs the creation,
perfection, priority, or enforcement of a security interest created by this
Commonwealth or a governmental unit of this Commonwealth;
(c) A statute of another state, a foreign country, or a governmental unit of another
state or a foreign country, other than a statute generally applicable to security
interests, expressly governs creation, perfection, priority, or enforcement of a
security interest created by the state, country, or governmental unit; or
(d) The rights of a transferee beneficiary or nominated person under a letter of
credit are independent and superior under KRS 355.5-114.
This article does not apply to:
(a) A landlord's lien, other than an agricultural lien;
(b) A lien, other than an agricultural lien, given by statute or other rule of law for
services or materials, but KRS 355.9-333 applies with respect to priority of
the lien;
(c) An assignment of a claim for wages, salary, or other compensation of an
employee, or for workers' compensation benefits payable to an individual;
(d) A sale of accounts, chattel paper, payment intangibles, or promissory notes as
part of a sale of the business out of which they arose;
(e) An assignment of accounts, chattel paper, payment intangibles, or promissory
notes which is for the purpose of collection only;
(f) An assignment of a right to payment under a contract to an assignee that is
also obligated to perform under the contract;
(g) An assignment of a single account, payment intangible, or promissory note to
an assignee in full or partial satisfaction of a preexisting indebtedness;
(h)
A transfer of an interest in or an assignment of a claim under a policy of
insurance, other than an assignment by or to a health-care provider of a healthcare-insurance receivable and any subsequent assignment of the right to
payment, but KRS 355.9-315 and 355.9-322 apply with respect to proceeds
and priorities in proceeds;
(i) An assignment of a right represented by a judgment, other than a judgment
taken on a right to payment that was collateral;
(j) A right of recoupment or set-off, but:
1.
KRS 355.9-340 applies with respect to the effectiveness of rights of
recoupment or set-off against deposit accounts; and
2.
KRS 355.9-404 applies with respect to defenses or claims of an account
debtor;
(k) The creation or transfer of an interest in or lien on real property, including a
lease or rents thereunder, except to the extent that provision is made for:
1.
Liens on real property in KRS 355.9-203 and 355.9-308;
2.
Fixtures in KRS 355.9-334;
3.
Fixture filings in KRS 355.9-501, 355.9-502, 355.9-512, 355.9-516, and
355.9-519; and
4.
Security agreements covering personal and real property in KRS 355.9604;
(l) An assignment of a claim arising in tort, other than a commercial tort claim,
but KRS 355.9-315 and 355.9-322 apply with respect to proceeds and
priorities in proceeds;
(m) An assignment of a deposit account in a consumer transaction, but KRS
355.9-315 and 355.9-322 apply with respect to proceeds and priorities in
proceeds;
(n) A claim or right to receive compensation for injuries or sickness as described
in 26 U.S.C. sec. 104(a)(1) or (2), as amended from time to time;
(o) A claim or right to receive benefits under a special needs trust as described in
42 U.S.C. sec. 1396p(d)(4), as amended from time to time;
(p) A right to receive money under a structured settlement as defined by KRS
454.430; or
(q) A public-finance transaction or a transfer by a government or governmental
unit.
Effective: April 2, 2002
History: Amended 2002 Ky. Acts ch. 124, sec. 1, effective April 2, 2002. -- Repealed
and reenacted 2001 Ky. Acts ch. 119, sec. 3, effective July 1, 2001. -- Repealed and
reenacted 2000 Ky. Acts ch. 408, sec. 29, effective July 1, 2001. -- Amended 1990
Ky. Acts ch. 478, sec. 2, effective July 13, 1990. -- Created 1958 Ky. Acts ch. 77,
sec. 9-109, effective July 1, 1960.
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