355.9 -109 Scope. (1) Except as otherwise provided in subsections (3) and (4) of this section, this article applies to: (a) A transaction, regardless of its form, that creates a security interest in personal property or fixtures by contract; (b) An agricultural lien; (c) A sale of accounts, chattel paper, payment intangibles, or promissory notes; (d) A consignment; (e) A security interest arising under KRS 355.2 -401, 355.2 -505, 355.2 -711(3), or 355.2A -508(5), as provided in KRS 355.9 -110; and (f) A security interest arising unde r KRS 355.4 -210 or 355.5 -118. (2) The application of this article to a security interest in a secured obligation is not affected by the fact that the obligation is itself secured by a transaction or interest to which this article does not apply. (3) This a rticle does not apply to the extent that: (a) A statute, regulation, or treaty of the United States preempts this article; (b) Another statute of this Commonwealth expressly governs the creation, perfection, priority, or enforcement of a security interest created by this Commonwealth or a governmental unit of this Commonwealth; (c) A statute of another state, a foreign country, or a governmental fection, priority, or enforcement of a security interest created by this Commonwealth or a governmental unit of this Commonwealth; (c) A statute of another state, a foreign country, or a governmental unit of another state or a foreign country, other than a statute generally applicable to security interests, expr essly governs creation, perfection, priority, or enforcement of a security interest created by the state, country, or governmental unit; or (d) The rights of a transferee beneficiary or nominated person under a letter of credit are independent and superior under KRS 355.5 -114. (4) This article does not apply to: (a) A landlord's lien, other than an agricultural lien; (b) A lien, other than an agricultural lien, given by statute or other rule of law for services or materials, but KRS 355.9 -333 applies with respect to priority of the lien; (c) An assignment of a claim for wages, salary, or other compensation of an employee, or for workers' compensation benefits payable to an individual; (d) A sale of accounts, chattel paper, payment intangibles, or promissory notes as part of a sale of the business out of which they arose; (e) An assignment of accounts, chattel paper, an individual; (d) A sale of accounts, chattel paper, payment intangibles, or promissory notes as part of a sale of the business out of which they arose; (e) An assignment of accounts, chattel paper, payment intangibles, or promissory notes which is for the purpose of collection only; (f) An assignment of a right to payment under a contract to an assignee that is also obligated to perform under the contract; (g) An assignment of a single account, payment inta ngible, or promissory note to an assignee in full or partial satisfaction of a preexisting indebtedness; (h) A transfer of an interest in or an assignment of a claim under a policy of insurance, other than an assignment by or to a health -care provider of a health - care-insurance receivable and any subsequent assignment of the right to payment, but KRS 355.9 -315 and 355.9 -322 apply with respect to proceeds and priorities in proceeds; (i) An assignment of a right represented by a judgment, other than a judgmen t taken on a right to payment that was collateral; (j) A right of recoupment or set -off, but: 1. KRS 355.9 -340 applies with respect to the effectiveness of rights of recoupment or set -off against deposit accounts; t to payment that was collateral; (j) A right of recoupment or set -off, but: 1. KRS 355.9 -340 applies with respect to the effectiveness of rights of recoupment or set -off against deposit accounts; and 2. KRS 355.9 -404 applies with respect to defenses or claims of an account debtor; (k) The creation or transfer of an interest in or lien on real property, including a lease or rents thereunder, except to the extent that provision is made for: 1. Liens on real property in KRS 355.9 -203 and 355. 9-308; 2. Fixtures in KRS 355.9 -334; 3. Fixture filings in KRS 355.9 -501, 355.9 -502, 355.9 -512, 355.9 -516, and 355.9 -519; and 4. Security agreements covering personal and real property in KRS 355.9 - 604; (l) An assignment of a claim arising in tort, other t han a commercial tort claim, but KRS 355.9 -315 and 355.9 -322 apply with respect to proceeds and priorities in proceeds; (m) An assignment of a deposit account in a consumer transaction, but KRS 355.9 -315 and 355.9 -322 apply with respect to proceeds and pri orities in proceeds; (n) A claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. sec. ion, but KRS 355.9 -315 and 355.9 -322 apply with respect to proceeds and pri orities in proceeds; (n) A claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. sec. 104(a)(1) or (2), as amended from time to time; (o) A claim or right to receive benefits under a special needs trust as described in 42 U.S.C. sec. 1396p(d)(4), as amended from time to time; (p) A right to receive money under a structured settlement as defined by KRS 454.430; or (q) A public -finance transaction or a transfer by a government or governmental unit. Effective: April 2, 2002 History: Amended 2002 Ky. Acts ch. 124, sec. 1, effective April 2, 2002. -- Repealed and reenacted 2001 Ky. Acts ch. 119, sec. 3, effective July 1, 2001. -- Repealed and reenacted 2000 Ky. Acts ch. 408, sec. 29, effective July 1, 2001. -- Amended 1990 Ky. Acts ch. 478, sec. 2, effective July 13, 1990. -- Created 1958 Ky. Acts ch. 77, sec. 9 -109, effective July 1, 1960.
Kentucky Legal Code