409.204 After-acquired property; future advances.

(1) After-acquired collateral. Except as otherwise provided in sub. (2), a security agreement may create or provide for a security interest in after-acquired collateral.

(2) When after-acquired property clause not effective. A security interest does not attach under a term constituting an after-acquired property clause to:

(a) Consumer goods, other than an accession when given as additional security, unless the debtor acquires rights in them within 10 days after the secured party gives value; or

(b) A commercial tort claim.

(3) Future advances and other value. A security agreement may provide that collateral secures, or that accounts, chattel paper, payment intangibles, or promissory notes are sold in connection with, future advances or other value, whether or not the advances or value are given pursuant to commitment.

History: 2001 a. 10.

A security agreement covering money lent “and all other obligations and liabilities" will not extend to obligations arising out of contract violations unless they were clearly within the intent of the parties. John Miller Supply Co. v. Western State Bank, 55 Wis. 2d 385, 199 N.W.2d 161 (1972).

Priorities of “future advances" under previously perfected security interests and article 9 of the U.C.C. 58 MLR 759.

Security interests in after-acquired property under the uniform commercial code. Skilton, 1974 WLR 925.

NOTE: The above annotated materials cite to the pre-2001 Wis. Act 10 version of s. 409.204.