2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 9 - Secured Transactions › Part 5 - FILING › Subpart 1 - FILING OFFICE; CONTENTS ANDEFFECTIVENESS OF FINANCING STATEMENT › Section 55-9-516 - What constitutes filing; effectiveness of filing.

(a) Except as otherwise provided in Subsection (b) of this section, communication of a record to a filing office and tender of the filing fee or acceptance of the record by the filing office constitutes filing.
(b) Filing does not occur with respect to a record that the secretary of state refuses to accept because:
(1) the record is not communicated by a method or medium of communication authorized by the filing office;
(2) an amount equal to or greater than the applicable filing fee is not tendered;
(3) the filing office is unable to index the record because:
(A) in the case of an initial financing statement, the record does not provide a name for the debtor;
(B) in the case of an amendment or information statement, the record:
(i) does not identify the initial financing statement as required by Section 55-9-512 or 55-9-518 NMSA 1978, as applicable; or
(ii) identifies an initial financing statement whose effectiveness has lapsed under Section 55-9-515 NMSA 1978;
(C) in the case of an initial financing statement that provides the name of a debtor identified as an individual or an amendment that provides a name of a debtor identified as an individual that was not previously provided in the financing statement to which the record relates, the record does not identify the debtor's surname; or
(D) in the case of a record filed or recorded in the filing office described in Paragraph (1) of Subsection (a) of Section 55-9-501 NMSA 1978, the record does not provide a sufficient description of the real property to which it relates;
(4) in the case of an initial financing statement or an amendment that adds a secured party of record, the record does not provide a name and mailing address for the secured party of record;
(5) in the case of an initial financing statement or an amendment that provides a name of a debtor that was not previously provided in the financing statement to which the amendment relates, the record does not:
(A) provide a mailing address for the debtor; or
(B) indicate whether the name provided as the name of the debtor is the name of an individual or an organization;
(6) in the case of an assignment reflected in an initial financing statement under Subsection (a) of Section 55-9-514 NMSA 1978 or an amendment filed under Subsection (b) of Section 55-9-514 NMSA 1978, the record does not provide a name and mailing address for the assignee; or
(7) in the case of a continuation statement, the record is not filed within the six-month period prescribed by Subsection (d) of Section 55-9-515 NMSA 1978.
(c) For purposes of Subsection (b) of this section:
(1) a record does not provide information if the secretary of state is unable to read or decipher the information; and
(2) a record that does not indicate that it is an amendment or identify an initial financing statement to which it relates, as required by Section 55-9-512, 55-9-514 or 55-9-518 NMSA 1978, is an initial financing statement.
(d) A record that is communicated to the filing office with tender of the filing fee, but that the secretary of state refuses to accept for a reason other than one set forth in Subsection (b) of this section, is effective as a filed record except as against a purchaser of the collateral that gives value in reasonable reliance upon the absence of the record from the files.
History:
1978 Comp., § 55-9-516, enacted by Laws 2001, ch. 139, § 87; 2013, ch. 137, § 16.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
1.
Source.
Subsection (a): Former section 9-403(1); the remainder is new.
2.
What Constitutes Filing.
Subsection (a) deals generically with what constitutes filing of a record, including an initial financing statement and amendments of all kinds (
e.g.
, assignments, termination statements, and continuation statements). It follows former section 9-403(1), under which either acceptance of a record by the filing office or presentation of the record and tender of the filing fee constitutes filing.
3.
Effectiveness of Rejected Record.
Subsection (b) provides an exclusive list of grounds upon which the filing office may reject a record.
See
Section 9-520(a) [55-9-520(a) NMSA 1978]. Although some of these grounds would also be grounds for rendering a filed record ineffective (
e.g.
, an initial financing statement does not provide a name for the debtor), many others would not be (
e.g.
, an initial financing statement does not provide a mailing address for the debtor or secured party of record). Neither this section nor Section 9-520 [55-9-520 NMSA 1978] requires or authorizes the filing office to determine, or even consider, the accuracy of information provided in a record.
A financing statement or other record that is communicated to the filing office but which the filing office refuses to accept provides no public notice, regardless of the reason for the rejection. However, this section distinguishes between records that the filing office rightfully rejects and those that it wrongfully rejects. A filer is able to prevent a rightful rejection by complying with the requirements of subsection (b). No purpose is served by giving effect to records that justifiably never find their way into the system, and subsection (b) so provides.
Subsection (d) deals with the filing office's unjustified refusal to accept a record. Here, the filer is in no position to prevent the rejection and as a general matter should not be prejudiced by it. Although wrongfully rejected records generally are effective, subsection (d) contains a special rule to protect a third-party purchaser of the collateral (
e.g.
, a buyer or competing secured party) who gives value in reliance upon the apparent absence of the record from the files. As against a person who searches the public record and reasonably relies on what the public record shows, subsection (d) imposes upon the filer the risk that a record failed to make its way into the filing system because of the filing office's wrongful rejection of it. (
Compare
section 9-517, under which a mis-indexed financing statement is fully effective.) This risk is likely to be small, particularly when a record is presented electronically, and the filer can guard against this risk by conducting a post-filing search of the records. Moreover, section 9-520(b) requires the filing office to give prompt notice of its refusal to accept a record for filing.
4.
Method or Medium of Communication.
Rejection pursuant to subsection (b)(1) for failure to communicate a record properly should be understood to mean noncompliance with procedures relating to security, signing, or other communication-related requirements that the filing office may impose. Subsection (b)(1) does not authorize a filing office to impose additional substantive requirements. See Section 9-520, Comment 2.
5.
Address for Secured Party of Record.
Under subsection (b)(4) and Section 9-520(a) [55-9-520(a) NMSA 1978], the lack of a mailing address for the secured party of record requires the filing office to reject an initial financing statement. The failure to include an address for the secured party of record no longer renders a financing statement ineffective.
See
Section 9-502(a) [55-9-502(a) NMSA 1978]. The function of the address is not to identify the secured party of record but rather to provide an address to which others can send required notifications,
e.g.
, of a purchase-money security interest in inventory or of the disposition of collateral. Inasmuch as the address shown on a filed financing statement is an "address that is reasonable under the circumstances," a person required to send a notification to the secured party may satisfy the requirement by sending a notification to that address, even if the address is or becomes incorrect.
See
Section 9-102 [55-9-102 NMSA 1978] (definition of "send"). Similarly, because the address is "held out by [the secured party] as the place for receipt of such communications [i.e., communications relating to security interests]," the secured party is deemed to have received a notification delivered to that address.
See
Section 1-202(e) [55-1-202(e) NMSA 1978].
6.
Uncertainty Concerning Individual Debtor's Surname.
Subsection (b)(3)(C) requires the filing office to reject an initial financing statement or amendment adding an individual debtor if the office cannot index the record because it does not identify the debtor's surname (
e.g.
, it is unclear whether the debtor's name surname is Elton or John).
7.
Inability of Filing Office to Read or Decipher Information.
Under subsection (c)(1), if the filing office cannot read or decipher information, the information is not provided by a record for purposes of subsection (b).
8.
Classification of Records.
For purposes of subsection (b), a record that does not indicate it is an amendment or identify an initial financing statement to which it relates is deemed to be an initial financing statement.
See
subsection (c)(2).
9.
Effectiveness of Rejectable but Unrejected Record.
Section 9-520(a) requires the filing office to refuse to accept an initial financing statement for a reason set forth in subsection (b). However, if the filing office accepts such a financing statement nevertheless, the financing statement generally is effective if it complies with the requirements of section 9-502(a) and (b).
See
section 9-520(c). Similarly, an otherwise effective financing statement generally remains so even though the information in the financing statement becomes incorrect.
See
section 9-507(b). (Note that if the information required by subsection (b)(5) is incorrect when the financing statement is filed, section 9-338 applies.)
ANNOTATIONS
The 2013 amendment,
effective July 1, 2013, clarified the rule for filing financing statements when the name of an individual debtor was not previously provided on the record or the record does not contain a sufficient description of real property to which the record relates; in Subparagraph (B) of Paragraph (3) of Subsection (b), after "amendment or", deleted "correction" and added "information"; added Subparagraphs (C) and (D) of Paragraph (3) of Subsection (b); in Subparagraph (B) of Paragraph (5) of Subsection (b), after "indicate whether the", added "name provided as the name of the", and after "name of the debtor is", added "the name of"; and deleted former Subparagraph (C) of Paragraph (5) of Subsection (b), which provided for the filing of financing statements when the debtor is an organization.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
68A Am. Jur. 2d Secured Transactions § 405 et seq.
79 C.J.S. Secured Transactions, § 65 et seq.