1Amending Titles 13 (Commercial Code), 30 (Fish) and 75
2(Vehicles) of the Pennsylvania Consolidated Statutes,
3revising secured transaction provisions relating to
4definitions, to control of electronic chattel paper, to
5location of debtor, to perfection of security interests in
6property subject to certain statutes, regulations and
7treaties, to continued perfection of security interest
8following change in governing law, to interests which take
9priority over or take free of security interest or
10agricultural lien, to priority of security interests created
11by new debtor, to discharge of account debtor, notification
12of assignment, identification and proof of assignment,
13restrictions on assignment of accounts, chattel paper,
14payment intangibles and promissory notes ineffective, to
15restrictions on assignment of promissory notes, health-care-
16insurance receivables and certain general intangibles
17ineffective, to contents of financing statement, record of
18mortgage as financing statement, time of filing financing
19statement, to name of debtor and secured party, to effect of
20certain events on effectiveness of financing statement, to
21duration and effectiveness of financing statement, effect of
22lapsed financing statement, to what constitutes filing,
23effectiveness of filing, to claim concerning inaccurate or
24wrongfully filed record and to collection and enforcement by
25secured party; providing for transition provisions for 2013
26amendments; imposing duties upon the Department of State and
27the Department of Transportation; and making editorial
28changes.

29The General Assembly of the Commonwealth of Pennsylvania
30hereby enacts as follows:

31Section 1. The definitions of "authenticate," "certificate

1of title," "jurisdiction of organization" and "registered
2organization" in section 9102(a) of Title 13 of the Pennsylvania
3Consolidated Statutes are amended and the subsection is amended
4by adding a definition to read:

5§ 9102. Definitions and index of definitions.

6(a) Division 9 definitions.--The following words and phrases
7when used in this division shall have the meanings given to them
8in this subsection:

9* * *

10"Authenticate." To:

11(i) sign; or

12(ii) [execute or otherwise adopt a symbol, or
13encrypt or similarly process a record in whole or in
14part,] with [the] present intent [of the authenticating
15person to identify the person and] to adopt or accept a
16record, attach to or logically associate with the record 
17an electrical sound, symbol or process.

18* * *

19"Certificate of title." A certificate of title with respect
20to which a statute provides for the security interest in
21question to be indicated on the certificate as a condition or
22result of the security interest's obtaining priority over the
23rights of a lien creditor with respect to the collateral. The 
24term includes another record maintained as an alternative to a 
25certificate of title by the governmental unit that issues 
26certificates of title if a statute permits the security interest 
27in question to be indicated on the record as a condition or 
28result of the security interest's obtaining priority over the 
29rights of a lien creditor with respect to the collateral.

30* * *

1"Jurisdiction of organization." With respect to a registered
2organization, the jurisdiction under whose law the organization
3is formed or organized.

4* * *

5"Public organic record." A record that is available to the
6public for inspection and is:

7(1) a record consisting of the record initially filed
8with or issued by a state or the United States to form or
9organize an organization and any record filed with or issued
10by the state or the United States which amends or restates
11the initial record;

12(2) an organic record of a business trust consisting of
13the record initially filed with a state and any record filed
14with the state which amends or restates the initial record,
15if a statute of the state governing business trusts requires
16that the record be filed with the state; or

17(3) a record consisting of legislation enacted by the
18legislature of a state or the Congress of the United States
19which forms or organizes an organization, any record amending
20the legislation, and any record filed with or issued by the
21state or the United States which amends or restates the name
22of the organization.

23* * *

24"Registered organization." An organization formed or 
25organized solely under the law of a single state or the United
26States [and as to which the state or the United States must
27maintain a public record showing the organization to have been
28organized.] by the filing of a public organic record, with the 
29issuance of a public organic record by, or the enactment of 
30legislation by the state or the United States. The term includes 

1a business trust that is formed or organized under the law of a 
2single state if a statute of the state governing business trusts 
3requires that a business trust's organic record be filed with 
4the state.

5* * *

6Section 2. Sections 9105, 9307(f)(2), 9308(a), 9310(b)(10),
79311(a)(2) and (3) and (b) and 9313(b) of Title 13 are amended
8to read:

9§ 9105. Control of electronic chattel paper.

10(a) General rule; control of electronic chattel paper.--A
11secured party has control of electronic chattel paper if a 
12system employed for evidencing the transfer of interests in the 
13chattel paper reliably establishes the secured party as the 
14person to which the chattel paper was assigned.

15(b) Specific facts giving control.--A system satisfies 
16subsection (a) if the record or records comprising the chattel
17paper are created, stored and assigned in such a manner that:

18(1) a single authoritative copy of the record or records
19exists which is unique, identifiable and, except as otherwise
20provided in paragraphs (4), (5) and (6), unalterable;

21(2) the authoritative copy identifies the secured party
22as the assignee of the record or records;

23(3) the authoritative copy is communicated to and
24maintained by the secured party or its designated custodian;

25(4) copies or [revisions] amendments which add or change
26an identified assignee of the authoritative copy can be made
27only with the [participation] consent of the secured party;

28(5) each copy of the authoritative copy and any copy of
29a copy is readily identifiable as a copy which is not the
30authoritative copy; and

1(6) any [revision] amendment of the authoritative copy
2is readily identifiable as [an] authorized or unauthorized
3[revision].

4§ 9307. Location of debtor.

5* * *

6(f) Location of registered organization organized under
7Federal law; bank branches and agencies.--Except as otherwise
8provided in subsection (i), a registered organization which is
9organized under the law of the United States and a branch or
10agency of a bank which is not organized under the law of the
11United States or a state are located:

12* * *

13(2) in the state which the registered organization,
14branch or agency designates, if the law of the United States
15authorizes the registered organization, branch or agency to
16designate its state of location, including by designating its 
17main office, home office or other comparable office; or

18* * *

19§ 9308. When security interest or agricultural lien is
20perfected; continuity of perfection.

21(a) Perfection of security interest.--Except as otherwise
22provided in this section and section 9309 (relating to security
23interest perfected upon attachment), a security interest is
24perfected if it has attached and all of the applicable
25requirements for perfection in sections 9310 (relating to when
26filing required to perfect security interest or agricultural
27lien; security interests and agricultural liens to which filing
28provisions do not apply) through 9316 (relating to [continued
29perfection of security interest following] effect of change in
30governing law) have been satisfied. A security interest is

1perfected when it attaches if the applicable requirements are
2satisfied before the security interest attaches.

3* * *

4§ 9310. When filing required to perfect security interest or
5agricultural lien; security interests and
6agricultural liens to which filing provisions do not
7apply.

8* * *

9(b) Exceptions: filing not necessary.--The filing of a
10financing statement is not necessary to perfect a security
11interest:

12* * *

13(10) which is perfected under section 9316 (relating to
14[continued perfection of security interest following] effect 
15of change in governing law).

16* * *

17§ 9311. Perfection of security interests in property subject to
18certain statutes, regulations and treaties.

19(a) Security interest subject to other law.--Except as
20otherwise provided in subsection (d), the filing of a financing
21statement is not necessary or effective to perfect a security
22interest in property subject to:

23* * *

24(2) a [certificate-of-title] statute of this
25Commonwealth or regulations promulgated thereunder, to the
26extent such statute or regulations provide for a security
27interest to be indicated on [the] certificate of title as a
28condition or result of perfection; or

29(3) a [certificate-of-title] statute of another
30jurisdiction which provides for a security interest to be

1indicated on [the] a certificate of title as a condition or
2result of the security interest's obtaining priority over the
3rights of a lien creditor with respect to the property.

4(b) Compliance with other law.--Compliance with the
5requirements of a statute, regulation or treaty described in
6subsection (a) for obtaining priority over the rights of a lien
7creditor is equivalent to the filing of a financing statement
8under this division. Except as otherwise provided in subsection
9(d) and sections 9313 (relating to when possession by or
10delivery to secured party perfects security interest without
11filing) and 9316(d) and (e) (relating to [continued perfection
12of security interest following] effect of change in governing
13law) for goods covered by a certificate of title, a security
14interest in property subject to a statute, regulation or treaty
15described in subsection (a) may be perfected only by compliance
16with those requirements, and a security interest so perfected
17remains perfected notwithstanding a change in the use or
18transfer of possession of the collateral.

19* * *

20§ 9313. When possession by or delivery to secured party
21perfects security interest without filing.

22* * *

23(b) Goods covered by certificate of title.--With respect to
24goods covered by a certificate of title issued by the
25Commonwealth, a secured party may perfect a security interest in
26the goods by taking possession of the goods only in the
27circumstances described in section 9316(d) (relating to
28[continued perfection of security interest following] effect of
29change in governing law).

30* * *

1Section 3. Section 9316 heading of Title 13 is amended and
2the section is amended by adding subsections to read:

3§ 9316. [Continued perfection of security interest following]
4Effect of change in governing law.

5* * *

6(h) Effect on filed financing statement of change in
7governing law.--The following rules apply to collateral to which
8a security interest attaches within four months after the debtor
9changes its location to another jurisdiction:

10(1) A financing statement filed before the change
11pursuant to the law of the jurisdiction designated in section
129301(a) or 9305(c) is effective to perfect a security
13interest in the collateral if the financing statement would
14have been effective to perfect a security interest in the
15collateral had the debtor not changed its location.

16(2) If a security interest perfected by a financing
17statement that is effective under paragraph (1) becomes
18perfected under the law of the other jurisdiction before the
19earlier of the time the financing statement would have become
20ineffective under the law of the jurisdiction designated in
21section 9301(a) or 9305(c) or the expiration of the four-
22month period, it remains perfected thereafter. If the
23security interest does not become perfected under the law of
24the other jurisdiction before the earlier time or event, it
25becomes unperfected and is deemed never to have been
26perfected as against a purchaser of the collateral for value.

27(i) Effect of change in governing law on financing statement
28filed against original debtor.--If a financing statement naming
29an original debtor is filed pursuant to the law of the
30jurisdiction designated in section 9301(a) or 9305(c) and the

1new debtor is located in another jurisdiction, the following
2rules apply:

3(1) The financing statement is effective to perfect a
4security interest in collateral acquired by the new debtor
5before, and within four months after, the new debtor becomes
6bound under section 9203(d) (relating to attachment and
7enforceability of security interest; proceeds; supporting
8obligations; formal requisites), if the financing statement
9would have been effective to perfect a security interest in
10the collateral had the collateral been acquired by the
11original debtor.

12(2) A security interest perfected by the financing
13statement and which becomes perfected under the law of the
14other jurisdiction before the earlier of the time the
15financing statement would have become ineffective under the
16law of the jurisdiction designated in section 9301(a) or
179305(c) or the expiration of the four-month period remains
18perfected thereafter. A security interest that is perfected
19by the financing statement but which does not become
20perfected under the law of the other jurisdiction before the
21earlier time or event becomes unperfected and is deemed never
22to have been perfected as against a purchaser of the
23collateral for value.

24Section 4. Sections 9317(b) and (d), 9320(c), 9326, 9406(e),
259408(b) and 9502(c) of Title 13 are amended to read:

26§ 9317. Interests which take priority over or take free of
27security interest or agricultural lien.

28* * *

29(b) Buyers that receive delivery.--Except as otherwise
30provided in subsection (e), a buyer, other than a secured party,

1of tangible chattel paper, tangible documents, goods,
2instruments or a [security certificate] certificated security
3takes free of a security interest or agricultural lien if the
4buyer gives value and receives delivery of the collateral
5without knowledge of the security interest or agricultural lien
6and before it is perfected.

7* * *

8(d) Licensees and buyers of certain collateral.--A licensee
9of a general intangible or a buyer, other than a secured party,
10of [accounts, electronic chattel paper, electronic documents,
11general intangibles or investment property] collateral other
12than tangible chattel paper, tangible documents, goods, 
13instruments or a certificated security takes free of a security
14interest if the licensee or buyer gives value without knowledge
15of the security interest and before it is perfected.

16* * *

17§ 9320. Buyer of goods.

18* * *

19(c) Effectiveness of filing for subsection (b).--To the
20extent that it affects the priority of a security interest over
21a buyer of goods under subsection (b), the period of
22effectiveness of a filing made in the jurisdiction in which the
23seller is located is governed by section 9316(a) and (b)
24(relating to [continued perfection of security interest
25following] effect of change in governing law).

26* * *

27§ 9326. Priority of security interests created by new debtor.

28(a) Subordination of security interest created by new
29debtor.--Subject to subsection (b), a security interest that is
30created by a new debtor [which is] in collateral in which the 

1new debtor has or acquires rights and is perfected solely by a
2filed financing statement which [is effective solely under
3section 9508 (relating to effectiveness of financing statement
4if new debtor becomes bound by security agreement) in collateral
5in which a new debtor has or acquires rights] would be 
6ineffective to perfect the security interest but for the 
7application of section 9316(i)(1) (relating to effect of change 
8in governing law) or 9508 (relating to effectiveness of 
9financing statement if new debtor becomes bound by security 
10agreement) is subordinate to a security interest in the same
11collateral which is perfected other than by such a filed
12financing statement [which is effective solely under section
139508].

14(b) Priority under other provisions; multiple original
15debtors.--The other provisions of this chapter determine the
16priority among conflicting security interests in the same
17collateral perfected by filed financing statements [which are
18effective solely under section 9508] described in subsection 
19(a). However, if the security agreements to which a new debtor
20became bound as debtor were not entered into by the same
21original debtor, the conflicting security interests rank
22according to priority in time of the new debtor's having become
23bound.

24§ 9406. Discharge of account debtor; notification of
25assignment; identification and proof of assignment;
26restrictions on assignment of accounts, chattel
27paper, payment intangibles and promissory notes
28ineffective.

29* * *

30(e) Inapplicability of subsection (d) to certain sales.--

1Subsection (d) does not apply to the sale of a payment
2intangible or promissory note, other than a sale pursuant to a 
3disposition under section 9610 (relating to disposition of 
4collateral after default) or an acceptance of collateral under 
5section 9620 (relating to acceptance of collateral in full or 
6partial satisfaction of obligation; compulsory disposition of 
7collateral).

8* * *

9§ 9408. Restrictions on assignment of promissory notes, health-
10care-insurance receivables and certain general
11intangibles ineffective.

12* * *

13(b) Applicability of subsection (a) to sales of certain
14rights to payment.--Subsection (a) applies to a security
15interest in a payment intangible or promissory note only if the
16security interest arises out of a sale of the payment intangible
17or promissory note, other than a sale pursuant to a disposition 
18under section 9610 (relating to disposition of collateral after 
19default) or an acceptance of collateral under section 9620 
20(relating to acceptance of collateral in full or partial 
21satisfaction of obligation; compulsory disposition of 
22collateral).

23* * *

24§ 9502. Contents of financing statement; record of mortgage as
25financing statement; time of filing financing
26statement.

27* * *

28(c) Record of mortgage as financing statement.--A record of
29a mortgage is effective, from the date of recording, as a
30financing statement filed as a fixture filing or as a financing

1statement covering as-extracted collateral or timber to be cut
2only if all of the following apply:

3(1) [the] The record indicates the goods or accounts
4which it covers[;].

5(2) [the] The goods are or are to become fixtures
6related to the real property described in the record, or the
7collateral is related to the real property described in the
8record and is as-extracted collateral or timber to be cut[;].

9(3) [the] The record satisfies the requirements for a
10financing statement in this section [other than an
11indication] subject to the following:

12(i) The record need not indicate that it is to be
13filed in the real property records[; and].

14(ii) The record sufficiently provides the name of a
15debtor who is an individual if it provides the individual
16name of the debtor or the surname and first personal name
17of the debtor, even if the debtor is an individual to
18whom section 9503(a)(4)(relating to name of debtor and
19secured party) applies.

20(4) [the] The record is duly recorded.

21* * *

22Section 5. Section 9503(a) and (b)(2) of Title 13 are
23amended and the section is amended by adding subsections to
24read:

25§ 9503. Name of debtor and secured party.

26(a) Sufficiency of debtor's name.--A financing statement
27sufficiently provides the name of the debtor:

28(1) [If] Except as otherwise provided in paragraph (3), 
29if the debtor is a registered organization or the collateral 
30is held in a trust that is a registered organization, only if

1the financing statement provides the name [of the debtor
2indicated] that is stated to be the registered organization's 
3name on the public organic record [of] most recently filed 
4with or issued or enacted by the [debtor's] registered 
5organization's jurisdiction of organization which [shows the
6debtor to have been organized] purports to state, amend or 
7restate the registered organization's name.

8(2) [If] Subject to subsection (f), if the [debtor is a
9decedent's estate] collateral is being administered by the 
10personal representative of a decedent, only if the financing
11statement provides, as the name of the debtor, the name of
12the decedent and, in a separate part of the financing 
13statement, indicates that the [debtor is an estate]
14collateral is being administered by a personal 
15representative.

16(3) If the [debtor is a trust or a trustee acting with
17respect to property held in trust, only if the financing
18statement:

19(i) provides the name specified for the trust in its
20organic documents or, if no name is specified, provides
21the name of the settlor and additional information
22sufficient to distinguish the debtor from other trusts
23having one or more of the same settlors; and

24(ii) indicates, in the debtor's name or otherwise,
25that the debtor is a trust or is a trustee acting with
26respect to property held in trust; and] collateral is 
27held in a trust that is not a registered organization, 
28only if the financing statement:

29(A) provides, as the name of the debtor:

30(I) if the organic record of the trust

1specifies a name for the trust, the name
2specified; or

3(II) if the organic record of the trust does
4not specify a name for the trust, the name of the
5settlor or testator; and

6(B) in a separate part of the financing
7statement:

8(I) if the name is provided under clause
9(A)(I), indicates that the collateral is held in
10a trust; or

11(II) if the name is provided under clause
12(A)(II), provides additional information
13sufficient to distinguish the trust from other
14trusts having one or more of the same settlors or
15the same testator and indicates that the
16collateral is held in a trust, unless the
17additional information so indicates.

18(4) Subject to subsection (g), if the debtor is an
19individual to whom the Department of Transportation has
20issued a driver's license which has not expired under 75
21Pa.C.S. § 1510(a) (relating to issuance and content of
22driver's license) or an identification card under 75 Pa.C.S.
23§ 1510(b), only if the financing statement provides the name
24of the individual which is indicated on:

25(i) except as set forth in subparagraph (ii), the
26driver's license; or

27(ii) if there is no driver's license, the
28identification card.

29(5) If the debtor is an individual to whom paragraph (4)
30does not apply, only if the financing statement provides the

1individual name of the debtor or the surname and first
2personal name of the debtor.

3[(4)] (6) In other cases:

4(i) if the debtor has a name, only if [it] the 
5financing statement provides the [individual or]
6organizational name of the debtor; and

7(ii) if the debtor does not have a name, only if
8[it] the financing statement provides the names of the
9partners, members, associates or other persons comprising
10the debtor, in a manner that each name provided would be 
11sufficient if the person named were the debtor.

12(b) Additional debtor-related information.--A financing
13statement which provides the name of the debtor in accordance
14with subsection (a) is not rendered ineffective by the absence
15of:

16* * *

17(2) unless required under subsection [(a)(4)(ii)] (a)(6)
18(ii), names of partners, members, associates or other persons
19comprising the debtor.

20* * *

21(f) Name of decedent.--The name of the decedent indicated on
22the order appointing the personal representative of the decedent
23issued by the court having jurisdiction over the collateral is
24sufficient as the name of the decedent under subsection (a)(2).

25(g) Multiple driver's licenses.--If the department has
26issued to an individual more than one driver's license or
27identification card of a kind described in subsection (a)(4),
28the one that was issued most recently is the one to which
29subsection (a)(4) refers.

30(h) Definition.--As used in this section, the term "name of

1the settlor or testator" means:

2(1) if the settlor is a registered organization, the
3name that is stated to be the settlor's name on the public
4organic record most recently filed with or issued or enacted
5by the settlor's jurisdiction of organization which purports
6to state, amend or restate the settlor's name; or

7(2) in other cases, the name of the settlor or testator
8indicated in the trust's organic record.

9Section 6. Sections 9507(c), 9515(f) and 9516(b)(3)(ii)
10introductory paragraph and (iii) and (5)(ii) and (iii) of Title
1113 are amended to read:

12§ 9507. Effect of certain events on effectiveness of financing
13statement.

14* * *

15(c) Change in debtor's name.--If [a debtor so changes its]
16the name that a filed financing statement provides for a debtor 
17becomes insufficient as the name of the debtor under section 
189503(a) (relating to name of a debtor and secured party) so that 
19the financing statement becomes seriously misleading under
20section 9506:

21(1) the financing statement is effective to perfect a
22security interest in collateral acquired by the debtor
23before, or within four months after, the [change] filed 
24financing statement becomes seriously misleading; and

25(2) the financing statement is not effective to perfect
26a security interest in collateral acquired by the debtor more
27than four months after the [change] filed financing statement 
28becomes seriously misleading, unless an amendment to the
29financing statement which renders the financing statement not
30seriously misleading is filed within four months after the

1[change] financing statement became seriously misleading.

2§ 9515. Duration and effectiveness of financing statement;
3effect of lapsed financing statement.

4* * *

5(f) Transmitting utility financing statement.--If a debtor
6is a transmitting utility and a filed initial financing
7statement so indicates, the financing statement is effective
8until a termination statement is filed.

9* * *

10§ 9516. What constitutes filing; effectiveness of filing.

11* * *

12(b) Refusal to accept record; filing does not occur.--Filing
13does not occur with respect to a record which a filing office
14refuses to accept because one of the following paragraphs
15applies:

16* * *

17(3) The filing office is unable to index the record
18because of a reason stated in one of the following
19subparagraphs:

20* * *

21(ii) In the case of an amendment or [correction]
22information statement, the record:

23* * *

24(iii) In the case of an initial financing statement
25which provides the name of a debtor identified as an
26individual or an amendment which provides a name of a
27debtor identified as an individual which was not
28previously provided in the financing statement to which
29the record relates, the record does not identify the
30debtor's [last name] surname.

1* * *

2(5) In the case of an initial financing statement or an
3amendment which provides a name of a debtor which was not
4previously provided in the financing statement to which the
5amendment relates, the record does not do [one or more] both
6of the following:

7* * *

8(ii) Indicate whether the name provided as the name 
9of the debtor is the name of an individual or an
10organization.

11[(iii) If the financing statement indicates that the
12debtor is an organization, provide:

13(A) a type of organization for the debtor;

14(B) a jurisdiction of organization for the
15debtor; or

16(C) an organizational identification number for
17the debtor or indicate that the debtor has none.]

18* * *

19Section 7. In section 9518 of Title 13, subsection (a) and
20subsection (b) heading, introductory paragraph and (2) are
21amended, subsections are added, subsection (c) is relettered and
22amended and subsection (d) is relettered and paragraphs (1)(i),
23(ii) introductory paragraph, (iii), (v) introductory paragraph
24and (A), (vi) and (2) are amended to read:

25§ 9518. Claim concerning inaccurate or wrongfully filed record.

26(a) [Correction statement] Statement with respect to record 
27indexed under person's name.--A person may file in the filing
28office [a correction] an information statement with respect to a
29record indexed there under the person's name if the person
30believes that the record is inaccurate or was wrongfully filed.

1(b) [Sufficiency] Contents of [correction] statement under 
2subsection (a).--[A correction] An information statement under 
3subsection (a) must:

4* * *

5(2) indicate that it is [a correction] an information
6statement; and

7* * *

8(c) Statement by secured party of record.--A person may file
9in the filing office an information statement with respect to a
10record filed there if the person is a secured party of record
11with respect to the financing statement to which the record
12relates and believes that the person that filed the record was
13not entitled to do so under section 9509(d) (relating to persons
14entitled to file a record).

15(d) Contents of statement under subsection (c).--An
16information statement under subsection (c) must:

17(1) identify the record to which it relates by the file
18number assigned to the initial financing statement to which
19the record relates;

20(2) indicate that it is an information statement; and

21(3) provide the basis for the person's belief that the
22person that filed the record was not entitled to do so under
23section 9509(d).

24[(c)] (e) Record not affected by [correction] information
25statement.--Except as provided in subsection [(d)] (f), the
26filing of [a correction] an information statement does not
27affect the effectiveness of an initial financing statement or
28other filed record.

29[(d)] (f) Fraudulent financing statements.--

30(1) The Department of State may conduct an

1administrative hearing to determine if an initial financing
2statement was fraudulently filed in accordance with the
3following:

4(i) The hearing shall be conducted in accordance
5with 2 Pa.C.S. (relating to Administrative Law and
6Procedure). The department shall determine the initial
7financing statement to be fraudulently filed for purposes
8of this subsection if it determines that no rational
9basis exists under section 9509 [(relating to persons
10entitled to file a record)] entitling the person to file
11the initial financing statement and it appears that the
12person filed the initial financing statement with intent
13to annoy, harass or harm the debtor.

14(ii) If the department determines that the initial
15financing statement was fraudulently filed and no timely
16appeal of the determination was filed, the department
17shall file [a correction] an information statement with
18respect to the initial financing statement indexed there.
19In addition to complying with the requirements of
20subsection (b), the [correction] information statement
21filed by the department under this paragraph shall state
22all of the following:

23* * *

24(iii) [A correction] An information statement filed
25by the department in accordance with paragraph (ii)
26creates a rebuttable presumption that the initial
27financing statement found to be fraudulently filed is
28ineffective.

29* * *

30(v) If the department determines that the initial

1financing statement was fraudulently filed and the
2determination is appealed to Commonwealth Court, the
3department shall file [a correction] an information
4statement with respect to the initial financing statement
5indexed there only upon affirmation by the court of its
6determination. In addition to complying with the
7requirements of subsection (b), the [correction]
8information statement shall state all of the following:

9(A) the [correction] information statement was
10filed by the department under this subsection;

11* * *

12(vi) If the department files [a correction] an 
13information statement with respect to the initial
14financing statement indexed there under this subsection,
15it shall refer the matter for criminal prosecution to the
16Office of Attorney General pursuant to 18 Pa.C.S. § 4911
17(relating to tampering with public records or
18information).

19(2) Nothing in this subsection limits the rights or
20remedies the debtor may have with respect to an initial
21financing statement that has been fraudulently filed. Nothing
22in this subsection limits the effectiveness of [a] any
23termination or [correction] information statement filed by a
24debtor under sections 9509(d)(2) and 9513 (relating to
25termination statement) or the rights of a debtor under
26section 9625 (relating to remedies for secured party's
27failure to comply with division).

28Section 8. Section 9607(b)(2)(i) of Title 13 is amended to
29read:

30§ 9607. Collection and enforcement by secured party.

1* * *

2(b) Nonjudicial enforcement of mortgage.--If necessary to
3enable a secured party to exercise under subsection (a)(3) the
4right of a debtor to enforce a mortgage nonjudicially, the
5secured party may record in the office in which a record of the
6mortgage is recorded:

7* * *

8(2) The secured party's sworn affidavit in recordable
9form stating that:

10(i) a default has occurred with respect to the 
11obligation secured by the mortgage; and

12* * *

13Section 9. Title 13 is amended by adding a chapter to read:

14CHAPTER 98

15TRANSITION PROVISIONS FOR 2013 AMENDMENTS

16Sec.

179800. Definitions.

189801. Effective date.

199802. Savings clause.

209803. Security interest perfected before effective date.

219804. Security interest unperfected before effective date.

229805. Effectiveness of action taken before effective date.

239806. When initial financing statement suffices to continue
24effectiveness of financing statement.

259807. Amendment of pre-effective-date financing statement.

269808. Person entitled to file initial financing statement or
27continuation statement.

289809. Priority.

29§ 9800. Definitions.

30The following words and phrases when used in this chapter

1shall have the meanings given to them in this section unless the
2context clearly indicates otherwise:

3"2013 Revision." The amendments which:

4(1) affect this division; and

5(2) are made by the act of , 2013 (P.L. ,
6No. ) entitled "An act amending Titles 13 (Commercial
7Code), 30 (Fish) and 75 (Vehicles) of the Pennsylvania
8Consolidated Statutes, revising secured transaction
9provisions relating to definitions, to control of electronic
10chattel paper, to location of debtor, to perfection of
11security interests in property subject to certain statutes,
12regulations and treaties, to continued perfection of security
13interest following change in governing law, to interests
14which take priority over or take free of security interest or
15agricultural lien, to priority of security interests created
16by new debtor, to discharge of account debtor, notification
17of assignment, identification and proof of assignment,
18restrictions on assignment of accounts, chattel paper,
19payment intangibles and promissory notes ineffective, to
20restrictions on assignment of promissory notes, health-care-
21insurance receivables and certain general intangibles
22ineffective, to contents of financing statement, record of
23mortgage as financing statement, time of filing financing
24statement, to name of debtor and secured party, to effect of
25certain events on effectiveness of financing statement, to
26duration and effectiveness of financing statement, effect of
27lapsed financing statement, to what constitutes filing,
28effectiveness of filing, to claim concerning inaccurate or
29wrongfully filed record; to collection and enforcement by
30secured party; providing for transition provisions for 2013

1amendments; imposing duties upon the Department of State and
2the Department of Transportation; and making editorial
3changes."

4§ 9801. Effective date.

5The 2013 Revision takes effect July 1, 2013.

6§ 9802. Savings clause.

7(a) Pre-effective-date transactions or liens.--Except as
8otherwise provided in this part, the 2013 Revision applies to a
9transaction or lien within its scope, even if the transaction or
10lien was entered into or created before the 2013 Revision takes
11effect.

12(b) Pre-effective-date proceedings.--The 2013 Revision does
13not affect an action, case, or proceeding commenced before the
142013 Revision takes effect.

15§ 9803. Security interest perfected before effective date.

16(a) Continuing perfection; perfection requirements
17satisfied.--A security interest that is a perfected security
18interest immediately before the 2013 Revision takes effect is a
19perfected security interest under this division as amended by
20the 2013 Revision if, when the 2013 Revision takes effect, the
21applicable requirements for attachment and perfection under this
22division as amended by the 2013 Revision are satisfied without
23further action.

24(b) Continuing perfection: perfection requirements not
25satisfied.--Except as otherwise provided in section 9805
26(relating to effectiveness of action taken before effective
27date), if, immediately before the 2013 Revision takes effect, a
28security interest is a perfected security interest, but the
29applicable requirements for perfection under this division as
30amended by the 2013 Revision are not satisfied when the 2013

1Revision takes effect, the security interest remains perfected
2thereafter only if the applicable requirements for perfection
3under this division as amended by the 2013 Revision are
4satisfied within one year after the 2013 Revision takes effect.

5§ 9804. Security interest unperfected before effective date.

6A security interest that is an unperfected security interest
7immediately before the 2013 Revision takes effect becomes a
8perfected security interest:

9(1) without further action, when the 2013 Revision takes
10effect if the applicable requirements for perfection under
11this division as amended by the 2013 Revision are satisfied
12before or at that time; or

13(2) when the applicable requirements for perfection are
14satisfied if the requirements are satisfied after that time.

15§ 9805. Effectiveness of action taken before effective date.

16(a) Pre-effective-date filing effective.--The filing of a
17financing statement before the 2013 Revision takes effect is
18effective to perfect a security interest to the extent the
19filing would satisfy the applicable requirements for perfection
20under this division as amended by the 2013 Revision.

21(b) When pre-effective-date filing becomes ineffective.--The
222013 Revision does not render ineffective an effective financing
23statement that, before the 2013 Revision takes effect, is filed
24and satisfies the applicable requirements for perfection under
25the law of the jurisdiction governing perfection as provided in
26this division as it existed before amendment by the 2013
27Revision. However, except as otherwise provided in subsections
28(c) and (d) and section 9806 (relating to when initial financing
29statement suffices to continue effectiveness of financing
30statement), the financing statement ceases to be effective:

1(1) if the financing statement is filed in this
2Commonwealth, at the time the financing statement would have
3ceased to be effective had the 2013 Revision not taken
4effect; or

5(2) if the financing statement is filed in another
6jurisdiction, at the earlier of:

7(i) the time the financing statement would have
8ceased to be effective under the law of that
9jurisdiction; or

10(ii) June 30, 2018.

11(c) Continuation statement.--The filing of a continuation
12statement after the 2013 Revision takes effect does not continue
13the effectiveness of a financing statement filed before the 2013
14Revision takes effect. However, upon the timely filing of a
15continuation statement after the 2013 Revision takes effect and
16in accordance with the law of the jurisdiction governing
17perfection as provided in this division as amended by the 2013
18Revision, the effectiveness of a financing statement filed in
19the same office in that jurisdiction before the 2013 Revision
20takes effect continues for the period provided by the law of
21that jurisdiction.

22(d) Application of subsection (b)(2)(ii) to transmitting
23utility financing statement.--Subsection (b)(2)(ii) applies to a
24financing statement that, before the 2013 Revision takes effect,
25is filed against a transmitting utility and satisfies the
26applicable requirements for perfection under the law of the
27jurisdiction governing perfection as provided in this division
28as it existed before amendment by the 2013 Revision, only to the
29extent that this division as amended by the 2013 Revision
30provides that the law of a jurisdiction other than the

1jurisdiction in which the financing statement is filed governs
2perfection of a security interest in collateral covered by the
3financing statement.

4(e) Application of Chapter 95.--A financing statement that
5includes a financing statement filed before the 2013 Revision
6takes effect and a continuation statement filed after the 2013
7Revision takes effect is effective only to the extent that it
8satisfies the requirements of Chapter 95 (relating to filing) as
9amended by the 2013 Revision for an initial financing statement.
10A financing statement that indicates that the debtor is a
11decedent's estate indicates that the collateral is being
12administered by a personal representative within the meaning of
13section 9503(a)(2) (relating to name of debtor and secured
14party) as amended by the 2013 Revision. A financing statement
15that indicates that the debtor is a trust or is a trustee acting
16with respect to property held in trust indicates that the
17collateral is held in a trust within the meaning of section
189503(a)(3) as amended by the 2013 Revision.

19§ 9806. When initial financing statement suffices to continue
20effectiveness of financing statement.

21(a) Initial financing statement in lieu of continuation
22statement.--The filing of an initial financing statement in the
23office specified in section 9501 (relating to filing office)
24continues the effectiveness of a financing statement filed
25before the 2013 Revision takes effect if:

26(1) the filing of an initial financing statement in that
27office would be effective to perfect a security interest
28under this division as amended by the 2013 Revision;

29(2) the pre-effective-date financing statement was filed
30in an office in another state; and

1(3) the initial financing statement satisfies subsection
2(c).

3(b) Period of continued effectiveness.--The filing of an
4initial financing statement under subsection (a) continues the
5effectiveness of the pre-effective-date financing statement:

6(1) if the initial financing statement is filed before
7the 2013 Revision takes effect, for the period provided in
8section 9515(a) through (e) and (g) (relating to duration and
9effectiveness of financing statement; effect of lapsed
10financing statement) with respect to an initial financing
11statement; and

12(2) if the initial financing statement is filed after
13the 2013 Revision takes effect, for the period provided in
14section 9515(f) as amended by the 2013 Revision with respect
15to an initial financing statement.

16(c) Requirements for initial financing statement under
17subsection (a).--To be effective for purposes of subsection (a),
18an initial financing statement must:

19(1) satisfy the requirements of Chapter 95 (relating to
20filing) as amended by the 2013 Revision for an initial
21financing statement;

22(2) identify the pre-effective-date financing statement
23by indicating the office in which the financing statement was
24filed and providing the dates of filing and file numbers, if
25any, of the financing statement and of the most recent
26continuation statement filed with respect to the financing
27statement; and

28(3) indicate that the pre-effective-date financing
29statement remains effective.

30§ 9807. Amendment of pre-effective-date financing statement.

1(a) Definitions.--Refer to subsection (f).

2(b) Applicable law.--After the 2013 Revision takes effect, a
3person may add or delete collateral covered by, continue or
4terminate the effectiveness of, or otherwise amend the
5information provided in, a pre-effective-date financing
6statement only in accordance with the law of the jurisdiction
7governing perfection as provided in this division as amended by
8the 2013 Revision. However, the effectiveness of a pre-
9effective-date financing statement also may be terminated in
10accordance with the law of the jurisdiction in which the
11financing statement is filed.

12(c) Method of amending: general rule.--Except as otherwise
13provided in subsection (d), if the law of this Commonwealth
14governs perfection of a security interest, the information in a
15pre-effective-date financing statement may be amended after the
162013 Revision takes effect only if:

17(1) the pre-effective-date financing statement and an
18amendment are filed in the office specified in section 9501
19(relating to filing office);

20(2) an amendment is filed in the office specified in
21section 9501 concurrently with, or after the filing in that
22office of, an initial financing statement that satisfies
23section 9806(c) (relating to when initial filing statement
24suffices to continue effectiveness of financing statement);
25or

26(3) an initial financing statement that provides the
27information as amended and satisfies section 9806(c) is filed
28in the office specified in section 9501.

29(d) Method of amending: continuation.--If the law of this
30Commonwealth governs perfection of a security interest, the

1effectiveness of a pre-effective-date financing statement may be
2continued only under section 9805(c) and (e) (relating to
3effectiveness of action taken before effective date) or 9806.

4(e) Method of amending: additional termination rule.--
5Whether or not the law of this Commonwealth governs perfection
6of a security interest, the effectiveness of a pre-effective-
7date financing statement filed in this Commonwealth may be
8terminated after the 2013 Revision takes effect by filing a
9termination statement in the office in which the pre-effective-
10date financing statement is filed, unless an initial financing
11statement that satisfies section 9806(c) has been filed in the
12office specified by the law of the jurisdiction governing
13perfection as provided in this division as amended by the 2013
14Revision as the office in which to file a financing statement.

15(f) Definition.--As used in this section, the term "pre-
16effective-date financing statement" means a financing statement
17filed before the 2013 Revision takes effect.

18§ 9808. Person entitled to file initial financing statement or
19continuation statement.

20A person may file an initial financing statement or a
21continuation statement under this part if:

22(1) the secured party of record authorizes the filing;
23and

24(2) the filing is necessary under this part:

25(i) to continue the effectiveness of a financing
26statement filed before the 2013 Revision takes effect; or

27(ii) to perfect or continue the perfection of a
28security interest.

29§ 9809. Priority.

30The 2013 Revision determines the priority of conflicting

1claims to collateral. However, if the relative priorities of the
2claims were established before the 2013 Revision takes effect,
3this division as it existed before amendment determines
4priority.

5Section 10. Section 5323(b) of Title 30 is amended to read:

6§ 5323. Content and effect of certificate of title.

7* * *

8(b) Certificate as evidence and notice.--A certificate of
9title issued by the commission is prima facie evidence of the
10facts appearing on the certificate. Except as otherwise provided 
11in 13 Pa.C.S. §§ 9311(d) (relating to perfection of security
12interests in property subject to certain statutes, regulations
13and treaties), 9315(c) and (d) (relating to secured party's
14rights on disposition of collateral and in proceeds) and 9316(d)
15and (e) (relating to [continued perfection of security interest
16following] effect of change in governing law), the certificate
17shall be adequate notice to the Commonwealth, creditors,
18subsequent lienholders and purchasers that a lien against the
19boat exists.

20Section 11. Sections 1137 and 7712.8(a) of Title 75 are
21amended to read:

22§ 1137. Subchapter exclusive for perfecting security interest.

23The method provided in this subchapter for perfecting and
24giving notice of security interests is exclusive, except as
25otherwise provided in 13 Pa.C.S. §§ 9315 (relating to secured
26party's rights on disposition of collateral and in proceeds) and
279316(d) and (e) (relating to [continued perfection of security
28interest following] effect of change in governing law).

29§ 7712.8. Perfection of security interest in a snowmobile or
30ATV.

1(a) Applicability of section.--Except as otherwise provided
2in 13 Pa.C.S. §§ 9311(d) (relating to perfection of security
3interests in property subject to certain statutes, regulations
4and treaties), 9315(c) and (d) (relating to secured party's
5rights on disposition of collateral and in proceeds) and 9316(d)
6and (e) (relating to [continued perfection of security interest
7following] effect of change in governing law), this section
8provides the exclusive method of perfecting a security interest
9in a snowmobile or ATV for which a certificate of title is
10required under this subchapter.

11* * *

12Section 12. In order to implement the amendment of 13
13Pa.C.S. § 9503, the Department of State and the Department of
14Transportation shall coordinate development and maintenance of
15electronic systems for entering and searching data.

16Section 13. This act shall take effect July 1, 2013.