Uniform Commercial Code – Motor Vehicles – Filing Requred to Perfect Security Interests
In 1958 Kentucky enacted the Uniform Commercial Code providing for the perfection of security interests in chattels by filing a financing statement, and a motor vehicle Certificate of Title Act requiring liens to be noted on the registration certificate covering the vehicle. The Code excludes from its filing provisions security interests in property subject to a Certificate of Title Act and provides that such interests can be perfected only by compliance with the requirements of the title act. However, unlike the typical Certificate of Title Act, the Kentucky title act does not provide that the notation of the lien on the registration certificate is to be the exclusive method of perfecting security interests. In an action for declaratory judgment, the trial court held that, the exemption provision notwithstanding, perfection is to be accomplished only by standard Code filing of a financing statement, although notation of liens on the registration certificate is also mandatory. On appeal, held, affirmed, one judge dissenting. The legislature intended that motor vehicle security interests be perfected by standard Code procedures. Lincoln Bank & Trust Co. v. Queenan, 344 S.W.2d 383 (Ky. 1961).