UCC-1: Can It Be Refused?

§ 14-118.6. Filing false lien or encumbrance.

(a) It shall be unlawful for any person to present for filing in a public record or a private record generally available to the public a false lien or encumbrance against the real or personal property of a public officer, a public employee, or an immediate family member of the public officer or public employee on account of the performance of the public officer or public employee’s official duties, knowing or having reason to know that the lien or encumbrance is false or contains a materially false, fictitious, or fraudulent statement or representation. For purposes of this subsection, the term “immediate family member” means a spouse or a child. Any person who violates this subsection shall be guilty of a Class I felony.”

These are all the people upon whom you may not file a UCC notice of security interest. Note that yourself is not listed.

“(b) In the case of a lien or encumbrance presented to the register of deeds for filing, if the register of deeds has a reasonable suspicion that the lien or encumbrance is false, the register of deeds may refuse to file the lien or encumbrance. Neither the register of deeds nor any other entity shall be liable for filing or refusing to file a lien or encumbrance under this section. If the filing of the lien or encumbrance is denied, the register of deeds shall allow the filing of a Notice of Denied Lien or Encumbrance Filing on a form adopted by the Secretary of State, for which no filing fee shall be collected. The Notice of Denied Lien or Encumbrance Filing shall not itself constitute a lien or encumbrance. If the filing of the lien or encumbrance is denied, any interested person may file a special proceeding in the county where the filing was denied within ten (10) business days of the filing of the Notice of Denied Lien or Encumbrance Filing asking the court to find that the proposed filing has a statutory or contractual basis and to order that the document be filed. If, after hearing, upon a minimum of five (5) days’ notice and opportunity to be heard to all interested persons and all persons claiming an ownership interest in the property, the court finds that there is a statutory or contractual basis for the proposed filing, the court shall order the document filed. A lien or encumbrance filed upon order of the court under this subsection shall have a priority interest as of the time of the filing of the Notice of Denied Lien or Encumbrance Filing. If the court finds that there is no statutory or contractual basis for the proposed filing, the court shall order that the proposed filing is null and void and that it shall not be filed, indexed, or recorded and a copy of that order shall be filed by the register of deeds that originally denied the filing. The review by the judge under this subsection shall not be deemed a finding as to any underlying claim of the parties involved. If a special proceeding is not filed under this subsection within ten (10) business days of the filing of the Notice of Denied Lien or Encumbrance Filing, the lien or encumbrance is deemed null and void.

(c) Upon being presented with an order duly issued by a court of this State declaring that a filed lien or encumbrance is false, and therefore null and void, the register of deeds that received the filing, in addition to filing the order, shall conspicuously mark on the first page of the original record previously filed the following statement: “THE CLAIM ASSERTED IN THIS DOCUMENT IS FALSE AND IS NOT PROVIDED FOR BY THE GENERAL LAWS OF THIS STATE.”

(d) In addition to any criminal penalties provided for in this section, a violation of this section shall constitute a violation of G.S. 75-1.1.”

BUT…

“(e) Subsections (b) and (c) of this section shall not apply to filings under Article 9 of Chapter 25 of the General Statutes or under Chapter 44A of the General Statutes. (2012-150, s. 4; 2013-170, s. 1; 2013-410, s. 27.8.)”

Even if the register of deeds believes your filings to be false, he/she may not refuse to file them. I do not condone filing false papers of any kind. However, the register of deeds is not in a position to refuse a notice of your interest in the legal entity created for your own use.

Addendum 1/31/15:

Theoretically, I would:
1) Create a Trust indenture:
a) Indicate a trustee and beneficiaries

b) Indicate the trust res (ie. fund the trust by putting ANY property in it. Remember that property is ANYTHING that can be the subject of ownership.)

c) Have the trust document notarized, but do not allow the notary to copy it. It remains a private document. Now it stands as proof of the entity. Being created in private, with all parties being private, it is a non-resident alien.

2) Separately, create a financing agreement in which the artificial person (legal entity), pledges all its property to the trust.

3) Now the trust (of which I may or may not be trustee) has controlling interest in the person. I see no reason why this process is deemed unallowable… the laws on the books do not forbid it. A real human man or woman can control an artificial entity, and that is well established.

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Beneficial Interest = Personal Property

When one signs a Deed of Trust upon buying a house/land, one essentially assigns his/her beneficial interest in the real estate to the lender. Beneficial interest in real estate is considered personal property, not real estate or real property.

“Chapter 44A.

Statutory Liens and Charges.

Article 1.

Possessory Liens on Personal Property.

§ 44A-1. Definitions.

As used in this Article:

(1) “Legal possessor” means

a. Any person entrusted with possession of personal property by an owner thereof, or

b. Any person in possession of personal property and entitled thereto by operation of law.”

Keep in mind that the definition of “property” is “Anything that is capable of being owned”.

It’s easy to find articles describing a beneficial interest as real property– here is one example I found in a brief search.

http://www.ccim.com/cire-magazine/articles/protect-your-assets-land-trust

“(3) “Owner” means

a. Any person having legal title to the property, or

b. A lessee of the person having legal title, or

c. A debtor entrusted with possession of the property by a secured party, or

d. A secured party entitled to possession, or

e. Any person entrusted with possession of the property by his employer or principal who is an owner under any of the above.”

You are “a” above when you buy a house. You retain legal title. The rest is also interesting in terms of using a UCC financing statement to gain status of “secured party”.

Are You A Landowner?

Not if you occupy the house/dwelling as a living space!

“Chapter 38A.

Landowner Liability.

§ 38A-1. Purpose.

The purpose of this Chapter is to encourage owners of land to make land and water areas available to the public at no cost for educational and recreational purposes by limiting the liability of the owner to persons entering the land for those purposes. (1995, c. 308, s. 1.)

§ 38A-2. Definitions.

(3) “Land” means real property, land, and water, but does not mean a dwelling and the property immediately adjacent to and surrounding such dwelling that is generally used for activities associated with occupancy of the dwelling as a living space.”

ALWAYS read the definitions. Sneaky.

Today’s Tidbit: Making Someone Subject to Jurisdiction

From NCGS 26, “Suretyship”.

Interesting way to phrase this:
“…provided the principal is found to be or can be made subject to the jurisdiction of the court”. Jurisdiction can be intentionally obtained if it is not already held.

Ҥ 26-12. Joinder of debtor by surety.

(a) As used in this section, “surety” includes guarantors, accommodation makers, accommodation indorsers, or others who undertake liability on the obligation and for the accommodation of another.

(b) When any surety is sued by the holder of the obligation, the court, on motion of the surety may join the principal as an additional party defendant, provided the principal is found to be or can be made subject to the jurisdiction of the court. Upon such joinder the surety shall have all rights, defenses, counterclaims, and setoffs which would have been available to him if the principal and surety had been originally sued together. (1959, c. 1121.)”