2006 Ohio Revised Code - 1309.706. (UCC 9-706) When initial financing statement suffices to continue effectiveness of financing statement.

§ 1309.706. (UCC 9-706) When initial financing statement suffices to continue effectiveness of financing statement.
 

(A)  The filing of an initial financing statement in the office specified in section 1309.501 of the Revised Code continues the effectiveness of a financing statement filed before July 1, 2001, if: 

(1) The filing of an initial financing statement in that office would be effective to perfect a security interest under this chapter. 

(2) The financing statement filed before July 1, 2001, was filed in an office in another state or another office in this state; and 

(3) The initial financing statement satisfies division (C) of this section. 

(B)  The filing of an initial financing statement under division (A) of this section continues the effectiveness of the financing statement filed before July 1, 2001: 

(1) If the initial financing statement is filed before July 1, 2001, for the period provided in section 1309.40 of the Revised Code, as it existed prior to July 1, 2001, with respect to a financing statement; and 

(2) If the initial financing statement is filed after July 1, 2001, for the period provided in section 1309.515 of the Revised Code, as it exists on July 1, 2001, with respect to an initial financing statement. 

(C)  To be effective for purposes of division (A) of this section, an initial financing statement shall: 

(1) Satisfy the requirements of sections 1309.501 to 1309.527 of the Revised Code, as they exist on July 1, 2001, for an initial financing statement; 

(2) Identify the financing statement filed before July 1, 2001, by indicating the office in which the financing statement was filed and providing the dates of filing and file numbers, if any, of the financing statement and of the most recent continuation statement filed with respect to the financing statement; and 

(3) Indicate that the financing statement filed before July 1, 2001, remains effective. 
 

HISTORY: 149 v S 74. Eff 7-1-2001.
 

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

 

Official Comment

1. Continuation of Financing Statements Not Filed in Proper Filing Office Under This Article. This section deals with continuing the effectiveness of financing statements that are filed in the proper state and office under former article 9, but which would be filed in the wrong state or in the wrong office of the proper state under this article. Section 9-705(d) provides that, under these circumstances, filing a continuation statement after the effective date of this article in the office designated by former article 9 would not be effective. This section provides the means by which the effectiveness of such a financing statement can be continued if this article governs perfection under the applicable choice of law rule: Filing an initial financing statement in the office specified by section 9-501. 

Although it has the effect of continuing the effectiveness of a pre-effective-date financing statement, an initial financing statement described in this section is not a continuation statement. Rather, it is governed by the rules applicable to initial financing statements. (However, the debtor need not authorize the filing. See section 9-707.) Unlike a continuation statement, the initial financing statement described in this section may be filed any time during the effectiveness of the pre-effective-date financing statement - even before this article is enacted - and not only within the six months immediately prior to lapse. In contrast to a continuation statement, which extends the lapse date of a filed financing statement for five years, the initial financing statement has its own lapse date, which bears no relation to the lapse date of the pre-effective-date financing statement whose effectiveness the initial financing statement continues. See subsection (b). 

As subsection (a) makes clear, the filing of an initial financing statement under this section continues the effectiveness of a pre-effective-date financing statement. If the effectiveness of a pre-effective-date financing statement lapses before the initial financing statement is filed, the effectiveness of the pre-effective-date financing statement cannot be continued. Rather, unless the security interest is perfected otherwise, there will be a period during which the security interest is unperfected before becoming perfected again by the filing of the initial financing statement under this section. 

If an initial financing statement is filed under this section before the effective date of this Article, it takes effect when this Article takes effect (assuming that it is ineffective under former article 9). Note, however, that former article 9 determines whether the filing office is obligated to accept such an initial financing statement. For the reason given in the preceding paragraph, an initial financing statement filed before the effective date of this Article does not continue the effectiveness of a pre-effective-date financing statement unless the latter remains effective on the effective date of this Article. Thus, for example, if the effectiveness of the pre-effective-date financing statement lapses before this Article takes effect, the initial financing statement would not continue its effectiveness. 

2. Requirements of Initial Financing Statement Filed in Lieu of Continuation Statement. Subsection (c) sets forth the requirements for the initial financing statement under subsection (a). These requirements are needed to inform searchers that the initial financing statement operates to continue a financing statement filed elsewhere and to enable searchers to locate and discover the attributes of the other financing statement. A single initial financing statement may continue the effectiveness of more than one financing statement filed before this Article's effective date. See section 1-102(5)(a) (words in the singular include the plural). If a financing statement has been filed in more than one office in a given jurisdiction, as may be the case if the jurisdiction had adopted former Section 9-401(1), third alternative, then an identification of the filing in the central filing office suffices for purposes of subsection (c)(2). If under this article the collateral is of a type different from its type under former article 9 - as would be the case, e.g., with a right to payment of lottery winnings (a "general intangible" under former article 9 and an "account" under this article), then subsection (c) requires that the initial financing statement indicate the type under this article.