## Facts

- Associated Receivables provided operating funds to Randy Vincent, doing business as “Summit Staffing,” and received a security interest in accounts receivable and related collateral.
- Associated Receivables filed a UCC financing statement listing “Randy A. Vincent” as debtor and “Summit Staffing” as an additional debtor, both at the same Lakeland, Florida address.
- Summit Staffing Polk County, Inc. later incorporated and continued the same staffing business at the same address, continuing to obtain financing and assign receivables to Associated Receivables.
- No new security agreement or amended financing statement was executed or filed after incorporation.
- The disputed collateral was accounts receivable owed by Cutrale Citrus that arose after the corporation’s incorporation.
- After the debtor filed Chapter 7, the trustee searched Florida’s UCC records under the corporate name and reported finding no secured interest; Associated Receivables’ search methodology revealed the earlier financing statement.
- Associated Receivables sought relief from the automatic stay to enforce its interest in the receivables; the trustee opposed and asserted priority as a hypothetical lien creditor under 11 U.S.C. § 544(a).
- Both sides moved for summary judgment on whether Associated Receivables held a perfected security interest enforceable against the trustee.

## Issues

1. Whether a pre-incorporation financing statement that did not state the corporation’s exact legal name, but listed “Summit Staffing” at the same address, was “seriously misleading” under Florida’s UCC and therefore ineffective to perfect the security interest against the Chapter 7 trustee.
2. Whether, under the filing-office “standard search logic” safe harbor, a financing statement is not seriously misleading if a search under the debtor’s correct name would disclose the filing.
3. Whether the trustee’s strong-arm powers under 11 U.S.C. § 544(a) gave the estate priority over the creditor’s claimed interest in post-incorporation accounts receivable.

## Decision

- The court denied the trustee’s motion for summary judgment.
- The court granted Associated Receivables’ motion for summary judgment, holding the security interest in accounts receivable was perfected and had priority over the trustee.
- The court granted Associated Receivables’ amended motion for relief from the automatic stay to proceed against the Cutrale receivables.

## Legal Principles

- Under Florida Article 9, a financing statement may be ineffective if the debtor name is sufficiently incorrect to be “seriously misleading.”
- A debtor-name error is not “seriously misleading” if, using the filing office’s standard search logic, a search under the debtor’s correct name would disclose the financing statement (safe-harbor rule).
- Article 9 is a notice-filing system; the central question is whether the public record provides reasonable notice to searchers using standard search procedures.
- A Chapter 7 trustee’s hypothetical lien-creditor status under 11 U.S.C. § 544(a) defeats unperfected security interests but does not defeat a properly perfected security interest.

## Conclusion

Because the Florida filing-office search logic disclosed the financing statement when searched under the corporate debtor’s correct name, the filing was not seriously misleading and Associated Receivables’ interest in the accounts receivable was perfected, defeating the trustee’s § 544(a) claim and justifying stay relief.


In re Summit Staffing Polk County, Inc., 305 B.R. 347 (Bankr. M.D. Fla. 2003)