Basic Uniform Commercial Code

Good


UCC § 9-102(a) recognizes four different types of goods:

  1. Farm Product

    "Farm products" means goods, other than standing timber, with respect to which the debtor is engaged in a farming operation and which are:

    1. crops grown, growing, or to be grown, including:
      1. crops produced on trees, vines, and bushes; and
      2. aquatic goods produced in aquacultural operations;
    2. livestock, born or unborn, including aquatic goods produced in aquacultural operations;
    3. supplies used or produced in a farming operation; or
    4. products of crops or livestock in their unmanufactured states.

    If processed, farm products turn to inventory.

  2. Inventory

    "Inventory" means goods, other than farm products, which:

    1. are leased by a person as lessor;
    2. are held by a person for sale or lease or to be furnished under a contract of service;
    3. are furnished by a person under a contract of service; or
    4. consist of raw materials, work in process, or materials used or consumed in a business.
  3. Consumer Good

    "Consumer goods" means goods that are used or bought for use primarily for personal, family, or household purposes.

  4. Equipment

    "Equipment" means goods other than inventory, farm products, or consumer goods.

Something must fall into one of these categories to be a good.

In borderline cases, when a good is used for both business and personal reasons, it is classified according to its principal use.

  • If split exactly 50/50, it is not a consumer good, as that requires "primarily" consumer use. 50% is not primarily.

Generally, changes in use after taking the secured interest, cannot unperfect the secured creditor's right.