Welcome to the on-line
November-2004 issue of the
Community Bankers' Advisor
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The Advisor is prepared by attorneys at Olson & Burns P.C. to provide information pertaining to
legal developments affecting the field of banking. In order
to accomplish this objective, we welcome any comments our
readers have regarding the content and format of this publication.
Please address your comments to:
Community Bankers' Advisor
c/o Olson & Burns P.C.
PO Box 1180
Minot, ND 58702-1180
olsonpc@minotlaw.com
Also, visit our web site at:
www.minotlaw.com
The attorneys at Olson & Burns represent a wide
range of clients in the financial and commercial areas.
Our attorneys represent more than 30 banks throughout North
Dakota. |
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You Are Asking . . . .
Q: How do we perfect a security interest in a life insurance policy? We are
going to get an Assignment Acknowledgment from the insurance company itself,
but do we also need to file a UCC-1 on the policy itself?
A: No. Revised Article 9 does not apply to security interests in life insurance
policies. See N.D.C.C. § 41-09-09(4)(h). You “perfect” by
properly filing the assignment with the insurance company according to their
procedure.
Q: Are we obligated to provide Regulation AA's cosigner notice for a business
loan where the signature of a guarantor is required?
A: No -- business credit is not subject to the notice requirement. Regulation
AA (12 C.F.R. Part 227) applies only to consumer transactions. Section 227.12(a)
defines “consumer” as a "natural person who seeks or acquires
goods, services, or money for personal, family, or household use other than
for the purchase of real property.”
Section 227.12(b)(1) defines “cosigner” as a "natural person
who assumes liability for the obligation of the consumer without receiving
goods, services or money in return for the obligation." The notice requirements
are set out in § 227.14, and subsection (a) clearly states that the provisions
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