2006 Ohio Revised Code - 1309.520. (UCC 9-520) Acceptance and refusal to accept record; redaction of SSNs and EINs from web site postings.

§ 1309.520. (UCC 9-520) Acceptance and refusal to accept record; redaction of SSNs and EINs from web site postings.
 

(A)  A filing office shall refuse to accept a record for filing for a reason specified in division (B) of section 1309.516 of the Revised Code and may refuse to accept a record for filing only for a reason specified in that division. However, the secretary of state's office shall redact social security and employer identification numbers from filings posted on its web site. 

(B)  If a filing office refuses to accept a record for filing, it shall communicate to the person who presented the record the fact of and reason for the refusal and the date and time the record would have been filed had the filing office accepted it. The communication must be made at the time and in the manner prescribed by the applicable filing-office rule but, in the case of a filing office described in division (A)(2) of section 1309.501 of the Revised Code, in no event more than two business days after the filing office receives the record. 

(C)  A filed financing statement that satisfies divisions (A) and (B) of section 1309.502 of the Revised Code is effective, even if the filing office is required to refuse to accept it for filing under division (A) of this section. However, section 1309.338 of the Revised Code applies to a filed financing statement that provides information described in division (B)(5) of section 1309.516 of the Revised Code that is incorrect at the time the financing statement is filed. 

(D)  If a record communicated to a filing office provides information that relates to more than one debtor, sections 1309.501 to 1309.527 of the Revised Code apply as to each debtor separately. 
 

HISTORY: 149 v S 74. Eff 7-1-2001; 151 v H 530, § 101.01, eff. 6-30-06.
 

The effective date is set by § 812.03 of 151 v H 530. 

The effective date is set by section 4 of SB 74. 

 

Official Comment

1. Source. New. 

2. Refusal to Accept Record for Filing. In some states, filing offices considered themselves obligated by former article 9 to review the form and content of a financing statement and to refuse to accept those that they determine are legally insufficient. Some filing offices imposed requirements for or conditions to filing that do not appear in the statute. Under this section, the filing office is not expected to make legal judgments and is not permitted to impose additional conditions or requirements. 

Subsection (a) both prescribes and limits the bases upon which the filing office must and may reject records by reference to the reasons set forth in section 9-516(b). For the most part, the bases for rejection are limited to those that prevent the filing office from dealing with a record that it receives - because some of the requisite information (e.g., the debtor's name) is missing or cannot be deciphered, because the record is not communicated by a method (e.g., it is MIME-rather than UU-encoded) or medium (e.g., it is written rather than electronic) that the filing office accepts, or because the filer fails to tender an amount equal to or greater than the filing fee. 

3. Consequences of Accepting Rejectable Record. Section 9-516(b) includes among the reasons for rejecting an initial financing statement the failure to give certain information that is not required as a condition of effectiveness. In conjunction with section 9-516(b)(5), this section requires the filing office to refuse to accept a financing statement that is legally sufficient to perfect a security interest under section 9-502 but does not contain a mailing address for the debtor, does not disclose whether the debtor is an individual or an organization (e.g., a partnership or corporation) or, if the debtor is an organization, does not give certain specified information concerning the organization. The information required by section 9-516(b)(5) assists searchers in weeding out "false positives," i.e., records that a search reveals but which do not pertain to the debtor in question. It assists filers by helping to ensure that the debtor's name is correct and that the financing statement is filed in the proper jurisdiction. 

If the filing office accepts a financing statement that does not give this information at all, the filing is fully effective. Section 9-520(c). The financing statement also generally is effective if the information is given but is incorrect; however, section 9-338 affords protection to buyers and holders of a perfected security interest who gives value in reasonable reliance upon the incorrect information. 

4. Filing Office's Duties with Respect to Rejected Record. Subsection (b) requires the filing office to communicate the fact of rejection and the reason therefor within a fixed period of time. Inasmuch as a rightfully rejected record is ineffective and a wrongfully rejected record is not fully effective, prompt communication concerning any rejection is important. 

5. Partial Effectiveness of Record. Under subsection (d), the provisions of this part apply to each debtor separately. Thus, a filing office may reject an initial financing statement or other record as to one named debtor but accept it as to the other. 

Example: An initial financing statement is communicated to the filing office. The financing statement names two debtors, John Smith and Jane Smith. It contains all of the information described in section 9-516(b)(5) with respect to John but lacks some of the information with respect to Jane. The filing office must accept the financing statement with respect to John, reject it with respect to Jane, and notify the filer of the rejection. 

 

Effect of Amendments

151 v H 530, effective June 30, 2006, added the last sentence to (A).