Secured Credit is for students who want to practice commercial law – and for those who do not. Credit is one of the major systems underlying the U.S. and global economies, so understanding it is crucial for all future lawyers, including public interest lawyers. This course covers a breadth of credit systems: consumer, business, secured, and unsecured – with a significant emphasis on commercial secured lending. This course also covers a fundamental question not addressed elsewhere in law school curriculum: once you win that big court case, how do you collect money from the other side? (Or, once you lose that big court case, how do you avoid paying?) Students will engage with real-world-based problems, financial current events, and practical strategies for addressing financial problems in consumer, small business and corporate contexts. The course's primary body of law is Article 9 of the Uniform Commercial Code, but it also touches on bankruptcy topics and real estate law.
A secured loan is one in which the debtor and lender agree that if the debtor does not pay, the lender can take specific items of property from the debtor. This property is called collateral, and the lender is said to have a security interest in the collateral. The collateral may be tangible property such as inventory, equipment, and consumer goods, or intangible property such as stocks and bonds or the debtor's right to collect from people who owe money to him.
This Secured Credit course examines how secured transactions are structured and why they are structured that way. It also covers the mechanics of making secured loans, the rules that govern repossessing the collateral if the debtor doesn't pay, and what can happen to security interests if the debtor goes bankrupt. It also examines the priority rules that rank competing claims to the same collateral. There may be many such claims. More than one secured lender may have a security interest in the collateral; unsecured creditors may seize the collateral to collect a judgment; customers or other third parties may buy the collateral.
This is also a course in statutory construction. We will devote very careful attention to using and interpreting the Uniform Commercial Code, the Bankruptcy Code, and non-uniform state law. We will progress from relatively simple statutory provisions to quite difficult ones, learning the skills that can be applied to a variety of statutes.
11:50 am - 1:05 pm
Pass/Fail Not Allowed
Secured Credit: A Systems Approach
- Lynn LoPucki & Elizabeth Warren