N.Y. Uniform Commercial Code Law § 9-316: Effect of Change in Governing Law

Section 9--316. Effect of Change in Governing Law.

(a) General rule: effect on perfection of change in governing law. A

security interest perfected pursuant to the law of the jurisdiction

designated in Section 9--301(a), 9--305(c), 9-306A(d), or 9-306B(b)

remains perfected until the earliest of:

(1) the time perfection would have ceased under the law of that

jurisdiction;

(2) the expiration of four months after a change of the debtor's

location to another jurisdiction; or

(3) the expiration of one year after a transfer of collateral to

a person that thereby becomes a debtor and is located in

another jurisdiction.

(b) Security interest perfected or unperfected under law of new

jurisdiction. If becomes perfected under the law of the other

jurisdiction before the earliest time or event described in that

subsection, it remains perfected thereafter. If the security interest

does not become perfected under the law of the other jurisdiction before

the earliest time or event, it becomes unperfected and is deemed never

to have been perfected as against a purchaser of the collateral for

value.

(c) Possessory security interest in collateral moved to new

jurisdiction. A possessory security interest in collateral, other than

goods covered by a certificate of title and as-extracted collateral

consisting of goods, remains continuously perfected if:

(1) the collateral is located in one jurisdiction and subject to

a security interest perfected under the law of that

jurisdiction;

(2) thereafter the collateral is brought into another

jurisdiction; and

(3) upon entry into the other jurisdiction, the security interest

is perfected under the law of the other jurisdiction.

(d) Goods covered by certificate of title from this state. Except as

otherwise provided in subsection (e), a security interest in goods

covered by a certificate of title which is perfected by any method under

the law of another jurisdiction when the goods become covered by a

certificate of title from this state remains perfected until the

security interest would have become unperfected under the law of the

other jurisdiction had the goods not become so covered.

(e) When subsection (d) security interest becomes unperfected against

purchasers. A security interest described in subsection (d) becomes

unperfected as against a purchaser of the goods for value and is deemed

never to have been perfected as against a purchaser of the goods for

value if the applicable requirements for perfection under Section

9--311(b) or 9--313 are not satisfied before the earlier of:

(1) the time the security interest would have become unperfected

under the law of the other jurisdiction had the goods not

become covered by a certificate of title from this state; or

(2) the expiration of four months after the goods had become so

covered.

(f) Change in jurisdiction of chattel paper, controllable electronic

record, bank, issuer, nominated person, securities intermediary, or

commodity intermediary. A security interest in chattel paper,

controllable accounts, controllable electronic records, controllable

payment intangibles, deposit accounts, letter-of-credit rights, or

investment property which is perfected under the law of the chattel

paper's jurisdiction, the controllable electronic record's jurisdiction,

the bank's jurisdiction, the issuer's jurisdiction, a nominated person's

jurisdiction, the securities intermediary's jurisdiction, or the

commodity intermediary's jurisdiction, as applicable, remains perfected

until the earlier of:

(1) the time the security interest would have become unperfected

under the law of that jurisdiction; or

(2) the expiration of four months after a change of the

applicable jurisdiction to another jurisdiction.

(g) Subsection (f) security interest perfected or unperfected under

law of new jurisdiction. If a security interest described in subsection

(f) becomes perfected under the law of the other jurisdiction before the

earlier of the time or the end of the period described in that

subsection, it remains perfected thereafter. If the security interest

does not become perfected under the law of the other jurisdiction before

the earlier of that time or the end of that period, it becomes

unperfected and is deemed never to have been perfected as against a

purchaser of the collateral for value.

(h) Effect on filed financing statement of change in governing law.

The following rules apply to collateral to which a security interest

attaches within four months after the debtor changes its location to

another jurisdiction:

(1) A financing statement filed before the change pursuant to the

law of the jurisdiction designated in Section 9--301(a) or

9--305(c) is effective to perfect a security interest in the

collateral if the financing statement would have been

effective to perfect a security interest in the collateral

had the debtor not changed its location.

(2) If a security interest perfected by a financing statement

that is effective under paragraph (1) becomes perfected under

the law of the other jurisdiction before the earlier of the

time the financing statement would have become ineffective

under the law of the jurisdiction designated in Section

9--301(a) or 9--305(c) or the expiration of the four-month

period, it remains perfected thereafter. If the security

interest does not become perfected under the law of the other

jurisdiction before the earlier time or event, it becomes

unperfected and is deemed never to have been perfected as

against a purchaser of the collateral for value.

(i) Effect of change in governing law on financing statement filed

against original debtor. If a financing statement naming an original

debtor is filed pursuant to the law of the jurisdiction designated in

Section 9--301(a) or 9--305(c) and the new debtor is located in another

jurisdiction, the following rules apply:

(1) The financing statement is effective to perfect a security

interest in collateral in which the new debtor has or

acquires rights before or within four months after the new

debtor becomes bound under Section 9--203(d), if the

financing statement would have been effective to perfect a

security interest in the collateral had the collateral been

acquired by the original debtor.

(2) A security interest that is perfected by the financing

statement and which becomes perfected under the law of the

other jurisdiction before the earlier of the expiration of

the four month period or the time the financing statement

would have become ineffective under the law of the

jurisdiction designated in Section 9--301(a) or 9--305(c)

remains perfected thereafter. A security interest that is

perfected by the financing statement but which does not

become perfected under the law of the other jurisdiction

before the earlier time or event becomes unperfected and is

deemed never to have been perfected as against a purchaser of

the collateral for value.