Requirements for Listing a Debtor’s Name on Florida Article 9 Filings

Florida lenders seeking to secure a lien against the personal property of a borrower in default must follow the guidelines detailed in Article 9 of the Uniform Commercial Code (UCC) and Florida’s Article 9, which governs secured transactions and is applied to a wide range of consumer and commercial credit transactions. Article 9 creates a way for lenders to record their interests in personal property that has been pledged as collateral for a loan.

To secure a lien against personal property pledged as collateral, lenders must file a Financing Statement — also known as “perfecting the lien” — with the Secretary of State when the borrower is legally incorporated or organized.

In the Financing Statement, the debtor must be identified by the exact legal name of the corporation or limited liability company. The UCC specifies that the debtor’s legal name be taken from the company’s articles of incorporation. Prior to 2010, if the debtor was an individual, the UCC was silent on any source lenders should use to determine the exact legal name of the debtor. As a result, lenders used different sources, including driver’s licenses and birth certificates. This inconsistency led to a number of legal disputes in Florida.

Statutory Revisions Change Lender Requirements

In 2010, the UCC amended and revised Article 9, and Florida adopted those revisions as codified in Florida Statute 679.5021, which became effective on July 1, 2013. Under these revisions, lender requirements for naming a debtor became much more stringent.

To perfect a security interest against an individual debtor, lenders must now file a Financing Statement that lists the debtor’s name as it appears on the debtor’s most recent driver’s license or, if the debtor lacks a valid driver’s license, any other state-issued identification card. Lenders are not allowed to rely on any other public record or online database to obtain this information. Under Florida Statute 679.5061(3), a filing that does not correctly name the debtor may be considered materially misleading and unenforceable.

Given these stringent requirements, lenders would be wise to implement policies and procedures to ensure the proper completion of their filings in compliance with Florida’s Article 9. Filings made prior to the 2010 revisions are grandfathered in until July 1, 2018. If a filing is continued beyond that date, lenders must be sure it complies with the new naming requirements.