Live Oak sought to invoke a defense under Florida’s Article 9 safe harbor, which provides that minor errors or omissions in a financing statement will only render such financing statement ineffective if such errors or omissions make the financing statement “seriously misleading." Under Florida’s Article 9, determining if such an error or omission is “seriously misleading” is determined by whether or not a search of the records of the filing office under the debtor's correct legal name, using the filing office's standard search logic, if any, discloses such financing statement. Statement proved fatal as the name specified in 1944 Beach’s Articles of Organization on file with the Florida Secretary of State included no such abbreviation. Of organization that purports to state, amend, or restate the registered organization's name.” Under this standard, the seemingly innocuous abbreviation of “Boulevard” to “Blvd.” in Live Oak’s financing Pursuant to Article 9 of the model Uniform Commercial Code (which has been adopted in Florida, along with all other states) (“ Article 9 ”)Ī financing statement must provide the “name of the debtor” which, for registered organizations is the “name on the public organic record most recently filed with or issued or enacted by the registered organization's jurisdiction Bankruptcy Code to avoid Live Oak’s defectively perfected security interest. LLC ”, thus enabling 1944 Beach to invoke Section 544 of the U.S. Live Oak ”), in connection with a $3mm loan from Live Oak to “ 1944 Beach Boulevard LLC ” (“ 1944 Beach ”) was “materially misleading” due to the fact that the UCC1 filing listed 1944 Beach’s name as “ 1944 Beach Blvd. The Eleventh Circuit’s September 29th ruling held that an all-assets UCC1 filing with the Florida Secured Transaction Registry by creditor Live Oak Banking Co. Court of Appeals for the Eleventh Circuit demonstrated how the simple abbreviation of a debtor’s name on a UCC1 financing statement can have costly implications for creditors whereby a creditor who has timely filed an otherwise proper UCC1 financing statement can be deemed unperfected.
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