CO Code § 4-9-108 (2021)
2021 Colorado Code|Title 4 - Uniform Commercial Code|Article 9 - Secured Transactions|Part 1 - General Provisions|§ 4-9-108. Sufficiency of Description

  Except as otherwise provided in subsections (c), (d), (e), and (f) of this section, a description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.    Except as otherwise provided in subsection (d) of this section, a description of collateral reasonably identifies the collateral if it identifies the collateral by:   Specific listing;    Category, including a category determined by use of a numerical or other code included in forms and formats adopted from time to time by the secretary of state;    Except as otherwise provided in subsection (e) of this section, a type of collateral defined in this title;    Quantity;    Computational or allocational formula or procedure; or    Except as otherwise provided in subsection (c) of this section, any other method, if the identity of the collateral is objectively determinable.       A description of collateral as “all the debtor's assets” or “all the debtor's personal property” or using words of similar import does not reasonably identify the collateral.    Except as otherwise provided in subsection (e) of this section, a description of a security entitlement, securities account, or commodity account is sufficient if it describes:   The collateral by those terms or as investment property; or    The underlying financial asset or commodity contract.       A description only by type of collateral defined in this title is an insufficient description of:   A commercial tort claim;    In a consumer transaction, consumer goods, a security entitlement, a securities account, or a commodity account; or    A deposit account.       Any description in the security agreement of personal property that includes consumer goods is sufficient as to the consumer goods only if it specifically identifies and itemizes such consumer goods.     History. Source: L. 2001: Entire article R&RE, p. 1330, § 1, effective July 1.    Editor's note:    The provisions of this section are similar to former §§ 4-9-110 and 4- 9-115 (3) as they existed prior to 2001.    Colorado legislative change: Colorado added the phrase “including a category determined by use of a numerical or other code included in forms and formats adopted from time to time by the secretary of state;” in subsection (b)(2), added a new paragraph (3) to subsection (e), and added a new subsection (f).     OFFICIAL COMMENT   1. Source. Former Sections 9-110, 9-115(3).   2. General Rules. Subsection (a) retains substantially the same formulation as former Section 9-110. Subsection (b) expands upon subsection (a) by indicating a variety of ways in which a description might reasonably identify collateral. Whereas a provision similar to subsection (b) was applicable only to investment property under former Section 9-115(3), subsection (b) applies to all types of collateral, subject to the limitation in subsection (d). Subsection (b) is subject to subsection (c), which follows prevailing case law and adopts the view that an “all assets” or “all personal property” description for purposes of a security agreement is not sufficient. Note, however, that under Section 9-504, a financing statement sufficiently indicates the collateral if it “covers all assets or all personal property.”   The purpose of requiring a description of collateral in a security agreement under Section 9-203 is evidentiary. The test of sufficiency of a description under this section, as under former Section 9-110, is that the description do the job assigned to it: make possible the identification of the collateral described. This section rejects any requirement that a description is insufficient unless it is exact and detailed (the so-called “serial number” test).   3. After-Acquired Collateral. Much litigation has arisen over whether a description in a security agreement is sufficient to include after-acquired collateral if the agreement does not explicitly so provide. This question is one of contract interpretation and is not susceptible to a statutory rule (other than a rule to the effect that it is a question of contract interpretation). Accordingly, this section contains no reference to descriptions of after-acquired collateral.   4. Investment Property. Under subsection (d), the use of the wrong Article 8 terminology does not render a description invalid (e.g., a security agreement intended to cover a debtor's “security entitlements” is sufficient if it refers to the debtor's “securities”). Note also that given the broad definition of “securities account” in Section 8-501, a security interest in a securities account also includes all other rights of the debtor against the securities intermediary arising out of the securities account. For example, a security interest in a securities account would include credit balances due to the debtor from the securities intermediary, whether or not they are proceeds of a security entitlement. Moreover, describing collateral as a securities account is a simple way of describing all of the security entitlements carried in the account.   5. Consumer Investment Property; Commercial Tort Claims. Subsection (e) requires greater specificity of description in order to prevent debtors from inadvertently encumbering certain property. Subsection (e) requires that a description by defined “type” of collateral alone of a commercial tort claim or, in a consumer transaction, of a security entitlement, securities account, or commodity account, is not sufficient. For example, “all existing and after-acquired investment property” or “all existing and after-acquired security entitlements,” without more, would be insufficient in a consumer transaction to describe a security entitlement, securities account, or commodity account. The reference to “only by type” in subsection (e) means that a description is sufficient if it satisfies subsection (a) and contains a descriptive component beyond the “type” alone. Moreover, if the collateral consists of a securities account or commodity account, a description of the account is sufficient to cover all existing and future security entitlements or commodity contracts carried in the account. See Section 9-203(h), (i).   Under Section 9-204, an after-acquired collateral clause in a security agreement will not reach future commercial tort claims. It follows that when an effective security agreement covering a commercial tort claim is entered into the claim already will exist. Subsection (e) does not require a description to be specific. For example, a description such as “all tort claims arising out of the explosion of debtor's factory” would suffice, even if the exact amount of the claim, the theory on which it may be based, and the identity of the tortfeasor(s) are not described. (Indeed, those facts may not be known at the time.)   ANNOTATION   Law reviews. For article, “The Revolution in Consumer Credit Legislation”, see 45 Den. L.J. 679 . For comment on In re Lehner appearing below, see 48 Den. L.J. 146 (1971). For article, “Secured Transactions — Part I: Attachment, Perfection and Priorities”, see 11 Colo. Law. 2939 (1982).   Annotator's note. Since § 4-9-108 is similar to § 4-9-110 as it existed prior to the 2001 repeal and reenactment of this article, relevant cases construing that provision have been included in the annotations to this section.   This section is intended to demand specificity only in the security agreement. In re Lehner, 303 F. Supp. 317 (D. Colo. 1969 ), aff'd per curiam and reh'g denied, 427 F.2d 357 (10th Cir. 1970).   The sufficiency of the description in the financing statement is to be determined by § 4-9-402 (1) . In re Lehner, 303 F. Supp. 317 (D. Colo. 1969 ), aff'd per curiam and reh'g denied, 427 F.2d 357 (10th Cir. 1970).   The use of the term “consumer goods” fails to satisfy this section. In re Lehner, 303 F. Supp. 317, (D. Colo. 1969 ), aff'd per curiam and reh'g denied, 427 F.2d 357 (10th Cir. 1970).   Collateral description in lease for use of landlord's building created an enforceable security interest in debtor's personal property where the lease described the collateral as all of the debtor's personal property and identified the location of the property. The collateral description in debtor's lease reasonably identified the secured collateral as all of the debtor's property at the jewelry store, including the scrap gold, merchandise, and business equipment and fixtures sold at a liquidation sale. This description is reasonably identified and objectively determinable under subsection (b)(6). In re Estate of Wheeler, 2013 COA 101 , 410 P.3d 483.   Applied in Young v. Golden State Bank, 39 Colo. App. 45, 560 P.2d 855 (1977).