Comments to Section 4--Continued
(7) Nothing in Comments (5) and (6) is intended to affect the
application of §§ 2-402(2), 9-205, 9-301, or 6-105 of the Uniform
Commercial Code, codified in Chapter 1 of Article I of Title 26 of
the Indiana Code. Section 2-402(2) recognizes the generally
prevailing rule that retention of possession of goods by a seller
may be fraudulent but limits the application of the rule by
negating any imputation of fraud from "retention of possession in
good faith and current course of trade by a merchant-seller for a
commercially reasonable time after a sale or identification."
Section 9-205 explicitly negates any imputation of fraud from the
grant of liberty by a secured creditor to a debtor to use,
commingle, or dispose of personal property collateral or to account
for its proceeds. The section recognizes that it does not relax
prevailing requirements for delivery of possession by a pledgor.
Moreover, the section does not mitigate the general requirement of
§ 9-301(1)(b) that a nonpossessory security interest in personal
property must be accompanied by notice-filing to be effective
against a levying creditor. Finally, like the UFCA this Act does
not pre-empt the statutes governing bulk transfers, such as Article
6 of the Uniform Commercial Code. Compliance with the cited
sections of the Uniform Commercial Code does not, however, insulate
a transfer or obligation from avoidance. Thus a sale by an
insolvent debtor for less than a reasonably equivalent value would
be voidable under this Act notwithstanding compliance with the
Uniform Commercial Code.
