UCC lien enforcement - debtor defaulted but title search shows conflicting filings

Thanks - that's a good point about checking the original articles. We pulled the UCC-1 from 2022 and it does match what was on the SOS records at that time. But now I'm worried about whether we needed to file an amendment when they updated their business license.

You generally don't need to amend for minor punctuation changes like commas, but it depends on your state's seriously misleading standard. Most courts would consider "ABC Manufacturing LLC" and "ABC Manufacturing, LLC" as the same entity.

We did run searches and that's how we found the duplicate filings. There's another lender who filed using the comma version about 8 months after us. If our filing is deemed defective, they could jump ahead of us in priority.

That's the real risk right there. Even if a court eventually rules in your favor, you'll spend months and thousands in legal fees fighting it. This is why I always run multiple name variations before filing anything.

Interesting - never heard of that service. Does it actually compare the documents against each other or just flag potential issues?

It does automated cross-checking between your UCC filings and corporate documents. Upload your charter docs and UCC-1, and it identifies any name discrepancies, missing info, or inconsistencies that could cause problems later. Really wish I'd known about it before my own lien enforcement disaster.

This sounds too good to be true. How accurate is the name matching? Our legal team spends hours manually comparing corporate docs to UCC filings.

I wouldn't be so casual about it. We lost a $90K enforcement case because the debtor's legal name had changed and we didn't catch it. The judge ruled our UCC-1 was seriously misleading and we lost priority to a junior creditor.

That sounds like more than just a comma issue though. Was it a complete name change or just punctuation?

It was similar to this situation - we used one version of the name and the business license showed a different variation. The court said our filing wouldn't be found by reasonable searchers because the SOS database was inconsistent.

Good advice on the UCC-3 amendment. Should we list both versions in the debtor name field or file separate amendments for each variation?

File one UCC-3 amendment that adds the comma version as an additional debtor name. That way you're covered under both variations without creating confusion about which filing is primary.

Default was 6 months ago but we've been in negotiations with the debtor. No formal enforcement action yet. The name issue came up during our pre-enforcement due diligence.

Six months is getting close to problem territory in some jurisdictions. You definitely want to resolve the name issue ASAP and move forward with enforcement if negotiations aren't working.

That's exactly what I'm worried about! The second lender could make the same argument against us. How strong does the name mismatch have to be for a priority challenge to succeed?

From what our attorney explained, it depends on whether the mismatch would prevent reasonable searchers from finding the filing. A comma difference is borderline - could go either way depending on the judge and jurisdiction.

This is solid advice. The documentation trail is everything in enforcement disputes. I'd also suggest getting a legal opinion letter about the name mismatch issue before proceeding - it might save problems later.

Good point about the legal opinion. We're definitely going to consult our counsel before taking any enforcement action. This situation has gotten more complicated than we initially thought.

How does it handle variations like comma differences? Does it flag those as problems or does it have some intelligence about minor punctuation issues?

It flags them for review but doesn't automatically call them errors. You get a report showing the differences and can decide if they're material. Much better than trying to spot these issues manually across multiple documents.

That's a pragmatic view but with $180K at stake, we need to at least explore our options. The amendment strategy mentioned earlier might give us the protection we need to proceed with full enforcement.

I agree with filing the UCC-3 amendment first. It's a small cost for big peace of mind, and it strengthens your position significantly if any other creditors try to challenge your priority during enforcement.