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Exam 25: Security Interests and Creditors Rights

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Question 21

Multiple Choice

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Helen's debt to Imprints Printers is past due. Imprints obtains a judgment against Helen,but sherefuses to pay it. Imprints asks the court for an order that directs the sheriff to seize and sell any of Helen's nonexempt real or personal property that is within the court's geographic jurisdiction. This is a request for

A) a writ of execution.
B) a composition agreement.
C) an order that would violate most state laws.
D) an order of garnishment.

E) None of the above
F) A) and D)

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Question 22

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Olaf is the creditor in a transaction with Phil. Once certain require-ments are met,Olaf's rights will attach,which means that Olaf will have

A) an indivisible ownership right to Phil's property.
B) an enforceable security interest in Phil's property.
C) a notice affixed to Phil's property.
D) the permission of a court to seize Phil's property.

E) A) and B)
F) All of the above

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Question 23

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Middling Credit Corporation asks Little Supply Company to agree to a security agreement that provides for coverage of the proceeds from the sale of after-acquired property. This is

Elvin fraudulently induces Franz,a consumer,to sign a promissory note to buy a speedboat. Elvin sells the note to Gaston,who takes it for value,in good faith,and without knowledge of the fraud. With respect to the defense against payment on the note to Elvin,Franz can

A guarantor is secondarily liable on an obligation.

Loni delivers her Mazda to be repaired at Nile's Body Shop. Loni agrees to pay cash. Nile performs,but Loni does not pay. Nile tells Loni that he will keep the car until she pays. This is

A security interest that provides for a security interest in collateral subject to future advances is a floating lien.

Jessie's debt to Kayla is past due. Kayla brings a legal action against Jessie to collect the debt. Kayla asks the court to order Liberty Bank,in which Jessie has an account,to pay a portion of the funds to Kayla. This is a request for

Proceedsare whatever is received when collateral is sold.

Frank performs a contract with Gene to add a garage to Gene's property,but Gene does not pay. Frank can file a lien on Gene's property if,from the last date labor or materials were provided,he acts

The payment of Chick's debt to Diamond is guaranteed by Chick's collection of eight restored autos. Their agreement describes Chick's subject property by serial number. To establish Diamond's interest,this is

Nell's debt to Olsen is past due. Olsen obtains an order of garnishment to require Nell's employer Pro Transmission Service,Inc.,to pay part of Nell's paycheck to Olsen. The law

The payment of John's debt to Kirsten is guaranteed by John's personal property. Kirsten is most likely to perfect her interest by

Advances against lines of credit can be subject to a perfected security interest in certain collateral.

Brass & Woodwind Instruments,Inc.,allows Clifton to keep a professional clarinet that he bought from Brass & Woodwind even though he has not paid the full price. Brass & Woodwind's legally sufficient financing statement in the goods need not include

A surety can use any defenses available to the principal debtor to avoid liability on the debt.

Hal's Hardware store defaults on a debt to Intrastate Bank,which takes possession of the collateral securing the debt. Intrastate sells the collat-eral. The proceeds from the sale are applied first to

An artisan's lien is possessory.? HYPERLINK "http://assessment.cengage.com/Instructor/TestGenerator.aspx" ?

To create an enforceable security interest,the secured party must give something of value to a debtor's other creditors.

Fleet Trucking,LLC,buys a white van from Go Motors,Inc.,on credit under a guaranty signed by Herbie,Fleet's president,making him personally liable if the company does not pay. Herbie is