How Do You Name a Debtor on a Washington UCC Financing Statement?

Apr 28, 2023

Under the Uniform Commercial Code (“UCC”), a financing statement is often required in connection with a secured transaction. For example, a person or business may borrow money to finance the purchase of equipment. Often, the equipment purchased serves as collateral (or security) for repayment of the loan. A financing statement will be filed to give notice to the world that the equipment is collateral. In the state of Washington, financing statements are filed with the state Department of Licensing and they can be searched on the Department’s website.

Financing statements can be searched by the name of the debtor (the party who borrowed the money in the example above) or by the name of the secured party (the party who granted the loan). The UCC specifies how the debtor is to be named on the financing statement and provides the standards for determining whether the financing statement “sufficiently” provides the name of the debtor. In Washington, if the debtor is an individual to whom the state of Washington has issued a driver’s license or identification card that has not expired, the debtor is sufficiently identified only if the financing statement provides the name of the individual as indicated on the driver’s license or identification card. If Washington has issued to the individual more than one driver’s license or identification card, the one that was issued most recently is the one used to determine the debtor’s name for purposes of a financing statement. If the individual has not been issued a Washington driver’s license or identification card that has not expired, the debtor is sufficiently identified on the financing statement only if it provides the individual name of the debtor or the surname and the first personal name of the debtor. Unfortunately, the Washington statute does not specify how to establish that the name used is the correct name. Sometimes, an individual debtor will engage in business under a trade name. For example, John Doe may be doing business as “John’s Auto Repair.” A financing statement identifying the debtor as John’s Auto Repair would not satisfy the naming requirement, although a financing statement identifying the debtor as John Doe, which also includes a reference to John’s Auto Repair would most likely be acceptable.

For a “registered organization,” such as a corporation, limited liability company, or limited partnership, the debtor’s name on the financing statement is only sufficient if the name is the organization’s name on the “public organic record” most recently filed with or issued by the registered organization’s jurisdiction of organization. For a corporation, its public organic record is its articles of incorporation and any amendments. For a limited liability company its public organic record is its certificate of formation and any amendments. For a limited partnership, its public organic record is its certificate of limited partnership and any amendments. (In Washington, these documents are filed with the Secretary of State.) Under this rule, naming a registered organization debtor in a financing statement by the name by which it is well known to the public, but which is not its name as reflected in the public organic record, is probably not sufficient.

This article deals only with individual and registered organization debtors. But, debtors can come in other forms and care must be taken to properly name the debtor in the financing statement. Otherwise, the secured position of the secured party may not be so secure.  

If you need assistance with these issues, contact Per Oscarsson or one of the other attorneys in Beresford Booth’s Business and Real Estate Group.

To learn more about How Do You Name a Debtor on a Washington UCC Financing Statement, please contact Beresford Booth at info@beresfordlaw.com or by phone at (425) 776-4100.

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