Request By:
Mr. J. U. Grow
Simpson County Clerk
Courthouse
Franklin, Kentucky
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General
You and others, as county clerks, are having difficulty in connection with the filing in Kentucky of conditional sales contracts by Tennessee automobile dealers. They apparently do not understand that the statutes require the original signature of the debtor party and secured party when filing in Kentucky.
General Motors Acceptance Corporation has a Tennessee form for vehicles, which dealers attempt to file in Kentucky. It is only a copy with copy signatures, not original. The conditional sales contract provides that seller retains a security interest in the property until the debt is paid. The dealer-seller assigned the contract to GMAC.
Your question is whether the Kentucky county clerk must have, for filing purposes, the original instrument containing the original signatures of the debtors and the secured party and showing the assignment to GMAC?
KRS 355.9-402(1) expressly requires that a financing statement must be signed by the debtor and the secured party. Thus Kentucky requires for filing purposes that the original or a copy thereof be actually, physically and manually signed by the debtor and the secured party. Thus a copy or reproduction of such signatures is not sufficient. A copy of a security agreement may be filed as a financing statement, provided that it contains the essential information outlined in KRS 355.9-402(1), and provided that it is actually and physically signed by the debtor and secured party (not a mere copy of signature) . The court said in
Lincoln Bank & Trust Company v. Queenan, Ky., 344 S.W.2d 383 (1961), that the Uniform Commercial Code (KRS Ch. 355) is plenary and exclusive, except where the legislature has clearly indicated otherwise. As relates to a signature, see 1 Anderson's Uniform Commercial Code, § 1-201 Official Code Comment, p. 33, Item 39.
As relates to the assignment of the security interest, KRS 355.9-405 permits such an assignment to be disclosed in the financing statement by indicating in the financing statement the name and address of the assignee or by an assignment itself or a copy thereof on the face or back of the statement. "Either the original secured party or the assignee may sign this statement as the secured party. " (Emphasis added). Note that the literal language of the statute indicates clearly that either the original secured party or the assignee must actually, physically, and manually sign the financing statement in connection with the assignment portion of the instrument. The courts are bound by the plain meaning of such language.