DOCUMENTING DELIVERY OF INITIAL FINANCING STATEMENTS IN INDIANA
Indiana’s version of the Uniform Commercial Code includes a provision not contained in the Ohio, Illinois or Kentucky versions of revised Article 9. This provision in Indiana relates to the delivery of the initial financing statement to the debtor. No later than thirty days after the financing statement is filed, the creditor must furnish a copy of the financing statement to the debtor. The statute does not specify how the copy of the financing statement must be furnished and does not specify what the creditor must do to prove compliance. Nevertheless, a creditor has the burden of proving that it complied with this requirement, in the event that a question arises.
The statute does not require that the financing statement delivered is a file-marked copy of the financing statement. As a result, one method that a creditor can use to comply with this statute is for the creditor to present a document to be executed by the debtor at closing acknowledging receipt of a copy of the financing statement. The Indiana statute is silent on whether the debtor can waive its right to receive a copy of the financing statement and security agreement. In the event that such a waiver is enforceable, financial institutions should consider including such a waiver provision in its security agreements used in Indiana so that a financial institution can attempt to assert the waiver as a defense in the event that the signed acknowledgement is lost or inadvertently not obtained. However, financial institutions should not rely on any waiver language. The best practice in Indiana is for creditors to obtain signed acknowledgements from the debtors, so that the creditor can establish written proof of compliance with the statutory requirements.