Also known as: attach a security interest · attaches a security interest · attaching a security interest · attached a security interest · attachment
Written by attorneys — see sources below.
The moment when a security interest in collateral becomes enforceable against the debtor with respect to the collateral. This occurs once value has been given, the debtor has rights in the collateral, and the debtor has authenticated a security agreement describing the collateral, unless the parties agree to postpone attachment.
Arcadia Retail grants a security interest in its inventory to a lender. The lender gives value by disbursing loan proceeds. Once Arcadia Retail authenticates the security agreement describing the inventory, the security interest attaches to the inventory even though the lender later lists related documents in an attachment to a deposition notice.
Adrian Aguilar pledges equipment as collateral for a loan from Aurora Biotech. After Aurora gives value and Adrian authenticates the security agreement, the security interest attaches to the equipment. Later criminal proceedings do not affect the already-attached security interest in the equipment.
Apex Dynamics borrows funds from Alpine Mining and signs a security agreement covering its machinery. Alpine Mining gives value by disbursing the loan proceeds. Because Apex Dynamics has rights in the machinery and authenticated the agreement, the security interest attaches immediately to the machinery.
Anita Ali holds a beneficial interest in a trust that is not subject to a spendthrift provision. A creditor obtains a court order authorizing attachment of future distributions. Once the creditor gives value and Anita Ali authenticates a security agreement covering her interest, the security interest attaches to those distributions.
Amber Alonzo grants a security interest in her warehouse to a supplier. The supplier gives value and Amber authenticates the security agreement, so the security interest attaches to the warehouse. Any later attempt to seize the warehouse without notice raises separate due process concerns.
In March 1988, John F. DiGiovanni submitted an application to the Connecticut Superior Court for a prejudgment attachment in the amount of $75,000 on Brian K. Doehr's home in Meriden, Connecticut, in conjunction with a civil action for assault and battery that he was seeking to institute against Doehr. DiGiovanni had no pre-existing interest in Doehr's real estate, and the suit did not involve the property. Connecticut law authorized prejudgment attachment of real estate without prior notice or hearing upon verification by oath that there was probable cause to sustain the validity of the plaintiff's claim. DiGiovanni accompanied the application with an affidavit stating that the facts set forth in his complaint were true, that he had been willfully, wantonly and maliciously assaulted by Doehr resulting in a broken left wrist, an ecchymosis to his right eye, and other injuries, and that he had expended sums for medical care and treatment. The affidavit concluded that these facts were sufficient to show probable cause that judgment would be rendered for the plaintiff. On March 17, 1988, the Superior Court judge found probable cause to sustain the validity of the claim and ordered the attachment on Doehr's home to the value of $75,000. The sheriff attached the property on March 21, 1988. Doehr first learned of the attachment after it had been recorded on the land records. He had not yet been served with the complaint. The attachment notice informed Doehr of his right to a hearing to claim that no probable cause existed, to request that the attachment be vacated or modified or a bond substituted, or to claim that some portion of the property was exempt. Doehr filed suit in the United States District Court for the District of Connecticut claiming that the Connecticut statute violated the Due Process Clause of the Fourteenth Amendment. The District Court granted summary judgment upholding the statute. The Court of Appeals for the Second Circuit reversed. The Supreme Court granted certiorari to resolve the conflict of authority regarding the statute's constitutionality.
View caseAlbert Allen pledges equipment to a creditor who gives value and obtains an authenticated security agreement. The security interest attaches to the equipment. Any subsequent ex parte writ to seize the equipment raises due process issues separate from the completed attachment.
Margarita Fuentes, a Florida resident, purchased a gas stove and a stereophonic phonograph from the Firestone Tire and Rubber Company under conditional sales contracts calling for monthly payments over time, with Firestone retaining title until full payment. After making payments for more than a year, about two hundred dollars remained due. A dispute developed between Fuentes and Firestone over servicing of the stove. Firestone then instituted an action in small claims court for repossession. It obtained a writ of replevin from the court clerk by submitting form documents and posting a bond in double the value of the property. A deputy sheriff and Firestone agent seized the stove and stereo from Fuentes's home the same day. Fuentes subsequently brought an action in federal district court challenging the constitutionality of the Florida prejudgment replevin procedures. A three-judge district court was convened and upheld the statute. In the consolidated Pennsylvania case, several residents purchased household goods such as beds, tables, and other items under similar installment contracts. After claimed defaults, sellers obtained writs of replevin from a prothonotary upon ex parte applications and posting of bonds. County sheriffs seized the goods from the buyers' homes without prior notice. This included one instance where a former deputy sheriff obtained a writ for his son's clothes, furniture, and toys. The Pennsylvania appellants filed suit in federal district court, where a three-judge court upheld the statute. The Supreme Court noted probable jurisdiction of the appeals from both district court decisions.
View caseAttachment occurs when the interest becomes enforceable against the debtor. This requires that value has been given, the debtor has rights in the collateral, and the debtor has authenticated a security agreement describing the collateral, unless the parties agree otherwise.
Supporting sources
Attachment creates an enforceable interest against the debtor. Perfection provides priority against third parties and usually requires an additional step such as filing a financing statement.
Yes. The statute expressly allows the parties to postpone the time of attachment by agreement even after the other requirements for enforceability have been met.
Supporting sources
…because the creditor must eventually prove his case in a judicial proceeding. They argue that the statutes are similar to the attachment statutes that this Court upheld in Ownbey v. Morgan , 256 U. S. 94, and Coffin Bros. v. Bennett , 277 U. S. 29. We think that the appellees' reliance on those cases is misplaced. In…