Sutherland discusses UCC Termination Filings

On October 17, the Delaware Supreme Court held that JP Morgan (JPM) terminated its security interest in all of the collateral provided by General Motors (GM) in support of a $1.5 billion loan, despite neither party intending that result, when it authorized the filing of a termination statement to its existing Uniform Commercial Code (UCC) financing statement. The Delaware Supreme Court stated that under Delaware law, the UCC requires only that a secured party authorize the filing of an amendment or termination statement, not that it otherwise understand the intent or the effect of such a filing. This holding places … Read more