Court Opinion

ID: 6397416
Source: CourtListenerOpinion
Date Created: 2022-06-25 00:26:15.776004+00
Date Added: 2024-06-11T15:50:57.237297
License: Public Domain

FINKELHOR, J.,
Plaintiffs filed a complaint of a secured party against defendants, pursuant to a mortgage contract for the purchase of real property, to enforce an alleged security agreement covering equipment and inventory located within the property. Attached to the complaint is the mortgage agreement, a judgment note and a financing statement covering inventory and equipment.
Defendant has filed preliminary objections in the nature of a demurrer and alleges that a financing statement, standing alone, does not meet the prerequisites of a security agreement as set forth in the Uniform Commercial Code.
The issue is whether the financing statement, noted above, in conjunction with the other documents, establishes a security agreement between the parties.
Section 9-203(l)(b) of the Uniform Commercial Code of April 6, 1953, P.L. 3, as amended, 12A P.S. §9-203, provides that “a security interest is not enforceable against the debtor or third parties unless . . . (b) the debtor has signed a security agreement which contains a description of the collateral. ...” Section 9-204 provides that “a security interest cannot attach until there is agreement. . . that it attach and value is given and the debtor has rights in the collateral.”
White and Summers* in their treatise on the Uniform Commercial Code note: “No court has yet found that a financing statement standing alone meets the requirements of 9-203(l)(b) as a security agreement.” In re Penn Housing Corp., 367 F. Supp. 661 (W.D.Pa. 1973).
*496In the Penn Housing case plaintiffs claim was supported not only by a financing statement, but by a series of 11 promissory notes and a letter from the debtor acknowledging the debt and a pledge of security. Based upon these supportive items, the District Court found a valid security agreement. In the instant proceedings, the financing statement is not reinforced by similar documents.
Therefore, after a careful review of the documents and the complaint, a security interest has not been established and defendants’ prehminary objections are sustained.
ORDER
And now, December 19, 1979, upon defendants’ prehminary objections to plaintiffs’ complaint, it is hereby ordered, adjudged and decreed that said prehminary objections are sustained and the complaint dismissed.

 White & Summers, Uniform Commercial Code 790, §23-3.