It's my understanding that individuals do not have exact legal names. So, what is an acceptable standard for what name to use in filing a UCC? Must it be their full name or the name they are known by? We have an individual who only uses his initials as a first name. Is that sufficient if that's the way he conducts business?

I believe your goal is to protect your interest. If I recall correctly, you should file in the most complete manner possible. I would be tempted to file under the full name of the individual. Does your customer have a first name? Some people only have initials for a first and middle name.

Individuals do have "exact legal names". I agree with iafarmer.

I thought individuals had exact legal names (only makes sense to me) but I have training material that stated the contrary. I also could not see how initials would be sufficient for filing. Thanks for your input.

Hi Lissa,

I must have the same materials you have. I also recall the instructor stating that but indicating your best defense is to be as exact as possible to avoid confusion with others who may have similar names. Seems like nothing is ever simple!

We have also used the AKA on our docs and filed under "common" names as well. I.E. Charles E. Brown III goes by Chuck Brown, we will include both names - legal and common - in our Security Agreement so we can file UCC with both names.

Note in section 9-506(c) that if the name of the debtor in a financing statement does not have the debtor’s “real” name financing statement will not be effective to perfect the lien.

For individuals the true and exact name of the person should be listed such as "Henry Y. Samuels, III", any variation will be considered seriously misleading.

According to 9-506(c), if the real name of the debtor is John Fitzgerald Kennedy and a search under that name did not discover the filing under John F. Kennedy, then the filing with only the middle initial makes the filing seriously misleading.

Some states ignore middle names in their standard search so using a middle initial or middle name (or no middle name at all) does not matter. However, in most states they do consider the middle name field in the search and would not discover the filing under John F. Kennedy if you search their correct name of John Fitzgerald Kennedy.

Under R9, it is not what you know that is important but what a search would discover. That is why the UCC1 form ask for the DEBTOR’S EXACT FULL LEGAL NAME and then state “do not abbreviate or combine names.”

If my document is filed with the exact name of the debtor I expect my filing to have priority over all the variations found on your search results, because when you report your search you are going to list my filing as exact and the others will be considered similar names.

If a filing under an incorrect name would be discovered by searching under the correct legal name, then the incorrect filing is still effective.

Of course it is, but the filing with the correct name holds priority over the incorrect filing. Unless you can prove that there was an error on your filing which caused it to be misleading.

Read the "minor error rule" in 9-506, especially subsection (c).

Did you know that doing a search in some states, like New Mexico, using their standard search logic and you only include the middle initial it will not discover a filing in the exact full legal name. For example if you search for Terry L Jones it will not discover a filing under the name Terry Lion Jones. Therefore, in such states the filing in the name of Terry L Jones would be insufficient to show the name of the debtor per 9-506.

Unless you’re the IRS, then you can file in the name of Bubba Brown and it will be effective against Brown Properties, Inc. They are not held to Article 9 standards.