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Uniform Commercial Code (The Application of Commercial Law (part-2)

16 Saturday Jun 2012

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(For Frank ‘Austin’ England III) 
 

Uniform Commercial Code

The National Conference of Commissioners on Uniform State Laws together with the American Law Institute drafted Nation-wide Uniform Laws and each state has now adopted these laws. These laws govern commercial transactions, including sales and leasing goods, transfer of funds, commercial paper, bank deposits and collections, letters of credit, bulk transfers, warehouse receipts, bills of laden, investment securities, and secured transactions. The UCC has been adopted in whole or substantially by all states. Blacks 6th. The UCC is a code of laws governing various commercial transactions — sale of goods, banking transactions, secured transactions in personal property, and other matters, that was designed to bring uniformity in these areas to the laws of the various states, and that has been adopted, with some modifications, in all states, including the District of Columbia and the Virgin Islands. Barron’s 3rd. Unless displaced by the particular provisions of this code, the principles of law and equity, including the law merchant and the law relative to capacity to contract, principle and agent, estopple, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, or other validating or invalidating cause shall supplement its provisions. UCC 1-103.

To paraphrase the third definition above, the UCC is the supreme law on the planet, and all other forms of law are encompassed by it and included in it (except you as a sovereign, of course). Pennsylvania was the first state to adopt the UCC (July 1954), and Louisiana the last (January 1, 1975).

The following is a quote from the BANK OFFICERS HANDBOOK OF COMMERCIAL BANKING LAW WITHIN THE UNITED STATES, sixth edition, paragraph 22.01(1) and pertains to certain types of transactions:

“There are twelve transactions to which the UCC does not apply. They are as follows:

1. Security interests governed by federal statutes . . .

2. Landlord liens . . .

3. Liens for services or material provided . . .

4. Assignment for claims fore wages . . .

5. Transfers by government agencies . . .

6. Certain isolated sales of accounts or chattel paper . . .

7. Insurance Policies . . .

8. Judgments . . .

9. Rights of setoff . . . (see setoff)

10. Real Estate interests . . .

11. Tort Claims . . .

12 Bank accounts . . .”

UCC-104 states : “Construction against implicit repeal. This code being a general act intended as a unified coverage of its subject matter, no part of it shall be deemed to be impliedly repealed by subsequent legislation in such construction be reasonably avoided”.

Nothing in the UCC has ever been repealed, nor can it ever be. In the event of conflict between a deleted section and a current section, the deleted section controls. If this is examined one will see that it cannot be the other way. Potentially countless commercial transactions can be consummated based on the current UCC at any time. To “cancel” any portion of the UCC at a later point is to throw into upheaval and chaos all commercial agreements that were based on the deleted portion, an act that would carry unimaginably astronomical liability to the many actors who attempted to effect such change.

Now, we must define the United States. This was covered in course number 2. But for purposes in this particular area, we must define it for a better understanding applied to this procedure.

Commercial Lien

A commercial lien is a non-judicial claim or charge against property of a Lien Debtor for payment of a debt or discharge of a duty or obligation. A lien has the effect of permanently seizing property in three months, ninety days, upon failure of the lien debtor to rebut the Affidavit of Claim of Lien. The commercial grace of a lien is provided by the three-month delay of the execution process, allowing resolution either verbally, in writing, or by jury trial within the 90 day grace period. A Distress (to be defined in Blacks 6th) bonded by an affidavit of information becomes a finalized matured commercial lien and accounts receivable ninety days from the date of filing. The Lien Right of a Lien must be expressed in the form of an Affidavit sworn true, correct and complete, with positive identification of the Affiant. The swearing is based on one’s own commercial liability.

A commercial lien differs from a true bill in commerce only in that ordinarily a true bill in commerce is private, whereas a lien is the same bill publicly declared, usually filed in the office of the County Recorder, and, like all such declarations, when uncontested by categorical point-for-point rebuttal of the affidavit, is a Security (15 USC) and an accounts-receivable.

A commercial lien differs from a non-commercial lien in that it contains a declaration of a one-to-one correspondence between an item or service purchased or offenses committed, and a debt owed. A commercial lien does not require a court process for its establishment. However, a commercial lien can be challenged via the Seventh Amendment jury trial, but may not be removed by anyone except the Lien Claimant or a jury trial, properly constituted, convened, and concluded by due process of law. It cannot be removed by summary process, i.e. a judges discretion. A commercial lien (or distress) can exist in ordinary commerce without dependence on a judicial process, and is therefore not a common law instrument unless challenged in a court of common law, whereupon it converts to a common law lien. A commercial lien must always contain an Affidavit in support of Claim of Lien and cannot be removed without a complete rebuttal of the Liens Claimant affidavit point-by-point, in order to overthrow the one-to-one correspondence of the commercial lien. Also, no common law process can remove a commercial lien unless that common law process guarantees and results in a complete rebuttal of the lien claimants Affidavit categorically and point-for-point in order to overthrow the one-to-one correspondence of the commercial lien.

What is a True Bill in Commerce?

This is a ledgering or bookkeeping/accounting, with every entry established. This is your first Affidavit, certified and sworn on the responsible party’s commercial liability as true, correct, and complete, not meant to mislead. It must contain a one-to one correspondence between an item or service purchased or offenses committed and the corresponding debt owed. This commercial relationship is what is known as “Just compensation” (5th Amendment to the Constitution), in relationship between the Government and the American people, a true bill is called a warrant (4th Amendment to the Constitution), and the direct taking of property by legislative act, ( e.g. IRS and the like) is called a “Bill of Pains and Penalties” (Constitution, Art. I, Section 10, Clause I, and Article I, Section 9, Clause 3 -“Bill of Attainder).

There is one other matter we must define before we start putting all these pieces of the puzzle together into a workable tool for our benefit. That is the Uniform Commercial Code itself.

United States – US- U.S.-USA-America

Means: (A) a federal corporation . . . Title 28 USC Section 3002(5) Chapter 176. It is clear that the United States . . . is a corporation . . . 534 FEDERAL SUPPLEMENT 724.

`It is well settled that “United States” et al is a corporation, originally incorporated February 21, 1871 under the name “District of Columbia,” 16 Stat. 419 Chapter 62. It was reorganized June 11, 1878; a bankrupt organization per House Joint Resolution 192 on June 5, 1933, Senate Report 93-549, and Executive Orders 6072, 6102, and 6246; a de facto (define de facto) government, originally the ten square mile tract ceded by Maryland and Virginia and comprising Washington D. C., plus the possessions, territories, forts, and arsenals.

The significance of this is that, as a corporation, the United States has no more authority to implement its laws against “We The People” than does Mac Donald Corporations, except for one thing — the contracts we’ve signed as surety for our strawman with the United States and the Creditor Bankers. These contracts binding us together with the United States and the bankers are actually not with us, but with our artificial entity, or as they term it “person”, which appears to be us but spelled with ALL CAPITAL LETTERS.

All this was done under,

VICE-ADMIRALTY COURTS.

In English Law. Courts established in the queen’s possessions beyond the seas, with jurisdiction over maritime causes, including those relating to prize.

The United States of America is lawfully the possession of the English Crown per original commercial joint venture agreement between the colonies and the Crown, and the Constitution, which brought all the states (only) back under British ownership and rule. The American people, however, had sovereign standing in law, independent to any connection to the states or the Crown. This fact necessitated that the people be brought back, one at a time, under British Rule, and the commercial process was the method of choice in order to accomplish this task. First, through the 14th Amendment and then through the registration of our birth certificate and property. All courts in America are Vice-admiralty courts in the Crowns private commerce.

ACCEPT FOR VALUE AND ACCEPTANCE

By now, you have probably heard the term accept for value. This term, for me, gave me quite a problem in understanding when first encountered. And, most of the people starting in this redemption program seems to have the same problem.

When you look up the word accept in Blacks 4th Edition you find, “To receive with approval or satisfaction; to receive with intent to retain.”

With this in mind, when you get a traffic ticket, a notice of foreclosure or whatever, one’s first instinct is “Oh, No. I’m certainly not going to ‘accept’ that!” Why would anyone want to accept such a thing?

Acceptance. The taking and receiving of anything in good part, and as it were a tacit agreement to a proceeding part, which might have been defeated or avoided if such acceptance had not been made.

Nope, that doesn’t sound much better, now does it?

First, you may not know what the word ‘tacit’ means so let’s look that one up as well. In Blacks 6th it states: 1. “Existing, inferred, or understood without being openly expressed or stated; implied by silence or silent acquiescence, as a tacit agreement or a tacit understanding. 2. Done or made in silence, implied or indicated, but not actually expressed. Manifested by the refrainment from contradiction or objection; inferred from the situation and circumstances, in the absence of express matter.”

From the above, I deduce that if I accept the thing then there is an agreement. I agree with what they have said in the writing, whatever it may be. But, then, if I don’t accept it, don’t say anything, then there is still an agreement because I don’t refute it or contradict what they say in the writing. I know from all my past experience that I certainly don’t want to get into a court battle with anyone. No matter how right you might think you are, what law you think is on your side, you always seem to lose in any court. My, my, what a predicament.

So, why would I want to accept anything for value? How could that phrase possibly be of any help?

Well, let’s look a little further, define more words, and see if we can make any sense out of all this.

Let’s go a little further when we look under Acceptance in Blacks 6th edition. You’ll go on down the page until you get to Types of acceptance. Beneath that heading you’ll see Conditional acceptance;

Conditional acceptance. An agreement to pay the draft or accept the offer on the happening of a condition.

A ‘conditional acceptance’ is in effect a statement that the offeree [this is you] is willing to enter into a bargain differing in some respects from that proposed in the original offer. The conditional acceptance is, therefore, itself a counter offer.”

OK. That sounds a little better. If I accept their offer with a conditional acceptance, I now have a counter offer to make back to them. Now, the ball is in their court. If they do not answer, they then accept your offer by tacit agreement and you win. Now this sounds much better. But, we’re not through yet. Let’s look at power of acceptance. In Blacks 6th edition it says:

Power of acceptance. Capacity of offeree [that’s you again, the offeree] upon acceptance of terms of offer, to create a binding contract.

So, if I accept your offer, with conditional acceptance, then place my own terms in which I do accept your offer, then we now have a binding contract. The offeror (a municipality or corporation) must now come back with a rebuttal to prove my terms and conditions in error. We will go into detail on this in the 5th Course – Contracts, but first you need to accept these contracts by claiming the fictitious entity the state created when you were born.

REDEMPTION

Did you know the UNITED STATES actually defines the fictitious entity spelled like your name with upper case letters as a “corporation”? The definition is in 15 USCA (United States Code Annotated) section 44;

“Corporation” shall be deemed to include any company, trust, so-called Massachusetts trust, or association, incorporated or unincorporated, which is organized to carry on business for its own profit or that of its members,….”

So if the state has created this “unincorporated corporation” then does it have authority over it? Yes it does. And until you give them notice otherwise, they will always have authority over it. That is what a UCC-1 Financing Statement does, it gives public notice that you, the secured party, have a claim against the debtor, the unincorporated corporation. Now when you file this notice, you take this entity “out of the state”, out of the jurisdiction of a fictitious entity and into the private venue, your kingdom, and thus the entity becomes “foreign” to the state and now it becomes an unincorporated foreign corporation to the state. Sounds like an oxymoron, but then again, I am using THEIR terminology!

Financing Statement: A document setting out a secured party’s security interest in goods. A document designed to notify third parties, generally prospective buyers or lenders, that there may be an enforceable security interest in the property of the debtor; It is merely evidence of the creation of a security interest, and usually is not itself a security agreement; The financing statement is filed by the security holder with the Secretary of State, or similar public body, and as such becomes public record.

Security Agreement: An agreement which creates or provides for a security interest between the debtor and a secured party. UCC-9- 105(h); An agreement granting a creditor a security interest in personal property, which security interest is normally perfected either by the creditor taking possession of the collateral or by filing financing statements in the proper public records.

Security interest: Interest in property obtained pursuant to security agreement; A form of interest in property which provides that the property may be sold on default in order to satisfy the obligation for which the security interest is given; Often “lien” is used as a synonym, although lien most commonly refers only to interests providing security that are created by operation of law, not through agreement of the debtor and creditor.

A security agreement must exist to file a UCC-1 Financing Statement, but does this mean it must be in writing and attached to the UCC-1? Possibly, but what if it is a verbal agreement? Since your strawman corporation cannot speak how can it write or sign its name? You can create one and attach it, but you probably don’t need it. In fact, one can still do all of the administrative procedures without filing a UCC-1, because you are the secured party and creditor whether you file or not. Filing the UCC-1 is actually more for your benefit than for anyone else because it makes this esoteric, intangible subject more real to you and gives you confidence, and that gain alone is worth every bit of the effort expended.

Some of the states give you a hard time when filing the financing statement as they claim you are “contracting with yourself”. To prevent this, you create a separation between you and your strawman corporation so that “they” can tell the difference (as if they didn’t know!). One of the things you can do is to apply for a tradename for your corporation. Once this is filed, you will start receiving promotions in the mail advertising credit card machines that you can use in your “new business”. You will not need them, but it indicates that the “corporate system” now recognizes your strawman as a “fictitious entity doing buisiness for profit” – a corporation.

Drill: File your tradename and UCC-1 Financing Statement

1. Go to the website for your state and pull off an Application for Trade Name and a UCC-1 Financing Statement form. You should be able to go to your Secretary of States site, such as SOSAZ would be for Arizona, or just call for the website.

2. Fill out the Application for Trade Name and send it into the SOS (Secretary of State) of your state along with the application fee. Mark “person” for the section of what kind of business it is. They get confused if you mark anything else.

3. When you get the Trade Name certificate back, make a copy as an attachment for the UCC-1 Financing Statement that you will be doing next.

4. Fill out the UCC-1 Financing Statement according to the example below and attach your Trade Name certificate to it as well as a copy of your birth certificate. A Security Agreement is not necessary as this is a private agreement between you and your corporation commonly referred to as a strawman. You must put the HOSPITAL where you were born as the address for the DEBTOR as this is where the corporation was created by the state. It is important to list all of the contracts that you have signed for your strawman such as the Drivers License, Social Security Number, Marriage license, Passport, etc.

5. Also reserve a number that will become your TREASURY POSTED REGISTERED ACCOUNT. This account will be set up at the US Department of Treasury with the private man entitled US Secretary of Treasury. It is important you refer to this man by his name such as “Paul O’Neill”, as you cannot deal with a fiction while in the private venue. The number will consist of the registered number that is printed on the red registered mail sticker you get from the Post Office, plus your social security number with NO dashes. Example is RR26511985 & 111223333.

6. File your UCC-1 with the SOS with the applicable fees.

Commercial Security Agreement

This non-negotiable and non-transferable Security Agreement is made and entered this day of ______________ , 2001 by and between JOHN HENRY DOE, hereinafter “Debtor”, Organization Number 570-50-8194 John Henry Doe, hereinafter “Secured Party”, Creditor Identification Number 544327911. The Parties, hereinafter “Parties”, are identified as follows:

DEBTOR:

JOHN HENRY DOE, a Legal Entity

SAINT MARY’S HOSPITAL

TUCSON, ARIZONA 85746

Organization Number: (Social Security Number)

Secured Party:

John Henry Doe, a man

Mailing Location: c/o 4741 W, Camino Tierra

Tucson, Arizona 85746

Creditor Identification Number: 544327911

AGREEMENT

NOW, THEREFORE, the Parties agree as follows:

Debtor hereby grants Secured Party, who deems herself insecure, a security interest in the Collateral described generally herein or specifically on attached Schedule A, hereinafter referred to as “Collateral”, to secure all Debtor’s property, as well as all income from every source, and all direct and indirect, absolute or contingent, due or to become due, now existing or hereafter arising, presumed or actual, parole or expressed public indebtedness and liabilities held by Debtor, to Secured Party in consideration for Secured Party providing certain things and accommodations for Debtor, including but not limited to:

1. the Secured Party signing by accommodation, without immediate consideration, for the Debtor when necessary where the signature of the Debtor will be required, while retaining the right to make sufficient claims to secured such indebtedness until satisfied in whole;

2. the Secured Party issuing a binding commitment to extend credit or to extend immediately available credit, whether or not drawn upon and whether or not reimbursed in the event of difficulties in collection; and

3. the Secured Party providing the security for payment of all sums due or owing, or to become due or owing, by the Debtor on every public contract entered by the Debtor.

Debtor declares it is a legal entity recognized as such, and has rights and privileges recognized under the laws of the United States, as has been the case since its creation in 1966. All legal means to protect the security interest being established by this Agreement, will be used by the Debtor when necessary; and all support needed by the Secured Party to protect his security interest in the collateral identified herein, will be provided by the Debtor.

Execution of this Security Agreement incorporates a promise that the Debtor will execute such commercial forms, including but not limited to such Financing Statements as may be necessary, to assure the Secured Party’s interest is perfected. The security interest established by this Agreement will continue until the Secured Party is relieved of all liability associated with said services provided to the Debtor, and until all owing and due consideration to the Secured Party has been delivered, regardless of whether the Collateral identified in this Agreement is in the possession of the Debtor or the Secured Party.

Debtor warrants that Secured Party’s claim against the Collateral is enforceable according to the terms and conditions expressed therein, and according to all applicable laws promulgated for the purpose of protecting the interests of a creditor against a debtor. Debtor also warrants that it holds good and marketable title to the Collateral, free and clear of all actual and lawful liens and encumbrances except for the interest established herein, and except for such substantial interest as may have been privately established by agreement of the parties with full attention to the elements necessary to establish a valid contract under international contract law. Public encumbrances belonging to the Debtor, against the Collateral, shall remain secondary to this Agreement, unless registered prior to the registration of Secured Party’s interest in the same Collateral, as is well-established in international commercial law.

GENERAL PROVISIONS

Possession of Collateral. Collateral or evidence of Collateral may remain in the possession of the Debtor, to be kept at the address given in this Agreement by the Debtor or such other place(s) approved by Secured Party, and notice of changes in location must be made to the Secured Party within ten (10) days of such relocation. Debtor agrees not to otherwise remove the Collateral except as is expected in the ordinary course of business, including sale of inventory, exchange, and other acceptable reasons for removal. When in doubt as to the legal ramifications for relocation, Debtor agrees to acquire prior written authorization from the Secured Party. Debtor may possess all tangible personal property included in Collateral, and have beneficial use of all other Collateral, and may use it in any lawful manner not inconsistent with this Agreement, except that Debtor’s right to possession and beneficial use may also apply to Collateral that is in the possession of the Secured Party if such possession is required by law to perfect Secured Party’s interest in such Collateral. If Secured Party, at any time, has possession of any part of the Collateral, whether before or after an Event of Default, Secured Party shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral, if Secured Party takes such action for that purpose as deemed appropriate by the Secured Party under the circumstances.

Proceeds and Products from Collateral.Unless waived by Secured Party, all proceeds and products from the disposition of the Collateral, for whatever reason, shall be held in trust for Secured Party and shall not be commingled with any other accounts or funds without the consent of the Secured Party. Notice of such proceeds shall be delivered to Secured Party immediately upon receipt. Except for inventory sold or accounts collected in the ordinary course of Debtor’s public business, Debtor agrees not to sell, offer to sell, or otherwise transfer or dispose of the Collateral; nor to pledge, mortgage, encumber, or otherwise permit the Collateral to be subject to a lien, security interest, encumbrance, or charge, other than the security interested established by this Agreement, without the prior written consent of the Secured Party.

Maintenance of Collateral. Debtor agrees to maintain all tangible Collateral in good condition and repair, and not to commit or permit damage to or destruction of the Collateral or any part of the Collateral. Secured Party and his designated representatives and agents shall have the right at all reasonable times to examine, inspect, and audit the Collateral wherever located. Debtor shall immediately notify Secured Party of all cases involving the return, rejection, repossession, loss, or damage of or to the Collateral; of all requests for credit or adjustment of Collateral, or dispute arising with respect to the Collateral; and generally of all happenings and events affecting the Collateral or the value or the amount of the Collateral.

Compliance with Law.Debtor shall comply promptly with all laws, ordinances, and regulations of all governmental authorities applicable to the production, disposition, or use of the Collateral. Debtor may contest in good faith any such law, ordinance, or regulation without compliance during a proceeding, including appropriate appeals, so long as Secured Party’s interest in the Collateral, in Secured Party’s opinion, is not jeopardized. Secured Party may, at his option, intervene in any situation that appears to place the Collateral in jeopardy.

Public Disputes.Debtor agrees to pay all applicable taxes, assessments, and liens upon the Collateral when due; provided that such taxes, assessments, and liens are proved to be superior to the lawful claim established by this Agreement and subsequently perfected by the Secured Party by appropriate registration. In the event Debtor elects to dispute such taxes, assessments, and liens, Secured Party’s interest must be protected at all times, at the sole opinion of the Secured Party, who may, at his option, intervene in any situation that appears to jeopardize Secured Party’s interest in the Collateral. Debtor may elect to continue pursuit of dispute of such taxes, assessments, and liens, only upon production of a surety bond by public claimant(s), in favor of the Secured Party, sufficient to protect Secured Party from loss, including all costs and fees associated with such dispute. Should public judgment against the Debtor result from such dispute, Debtor agrees to satisfy such judgment from its accounts established and managed by the United States or its subdivisions, agents, officers, or affiliates, so as not to adversely affect the Secured Party’s interest in the Collateral.

Indemnification. Debtor hereby indemnifies Secured Party from all harm as expressed in the attached Indemnity Bond, incorporated herein as if fully set forth within this Security Agreement.　

(Blog Master Note: Next Post I’ll continue with this sample of a Commercial Security Agreement)