## Facts

- Global One made a $1 million loan to Christopher Hanson’s insurance agency and took a security interest in Hanson’s interests in two annuity contracts issued by Fidelity & Guaranty (contracts L9E00015 and L9E00016).
- Wells Fargo, acting as collateral agent for Global One, filed two Missouri UCC financing statements naming the debtor as “Christopher J. Hanson.”
- Each financing statement contained broad collateral language covering all of the debtor’s assets and proceeds and then specifically referenced an annuity contract.
- The first financing statement misstated both the annuity contract number (LE900015 instead of L9E00015) and the issuer (listed Lincoln Benefit Life instead of Fidelity & Guaranty).
- The second financing statement correctly stated the contract number L9E00016 but again misstated the issuer as Lincoln Benefit Life.
- ProGrowth later loaned Hanson money, took a security interest in the same annuity contracts, and filed a financing statement accurately identifying both contract numbers and the issuer.
- ProGrowth brought a declaratory judgment action to determine priority among the competing secured creditors.
- The district court granted summary judgment to ProGrowth, concluding Wells Fargo/Global One’s financing statements were “seriously misleading” and ineffective to perfect as to the annuities.

## Issues

1. Whether Missouri UCC financing statements that correctly name the debtor and include an “all assets” description, but contain errors in specific annuity contract details, are “seriously misleading” and therefore ineffective to perfect a security interest in the annuities.
2. Whether Wells Fargo/Global One’s earlier filings perfected first and therefore had priority over ProGrowth’s later, accurate filing.

## Decision

- The Eighth Circuit reversed the summary judgment for ProGrowth.
- The court held Wells Fargo/Global One’s financing statements were not “seriously misleading” when viewed as a whole.
- The court held the “all assets” collateral description provided sufficient notice to subsequent creditors that the debtor’s property, including the annuities, might be encumbered.
- Because the earlier filings were effective to perfect, Wells Fargo/Global One’s security interests had priority over ProGrowth’s later-filed interest.

## Legal Principles

- A UCC financing statement primarily serves a notice function; it need only indicate the collateral sufficiently to alert later creditors to inquire further.
- Under the Missouri UCC, a generic “all assets” description is permitted in a financing statement and can be sufficient to perfect a security interest.
- “Seriously misleading” is assessed by evaluating the financing statement in its entirety; errors in specific collateral details do not necessarily defeat perfection when the filing otherwise gives adequate notice.
- Subsequent creditors who are alerted by a broad financing statement bear the responsibility to investigate the nature and scope of prior security interests.

## Conclusion

The Eighth Circuit held that earlier-filed Missouri UCC financing statements describing collateral as “all assets” were effective to perfect despite incorrect annuity issuer information and one incorrect contract number, so the earlier secured creditors retained priority over a later creditor that filed a more accurate statement.


ProGrowth Bank, Inc. v. Wells Fargo Bank, N.A., 558 F.3d 809 (8th Cir. 2009)