Corona Fruits & Veggies, Inc. v. Frozsun Foods, Inc.

Shakespeare asked, “What’s in a name?” We supply an answer only for the Uniform Commercial Code lien priority statutes; Everything when the last name is true and nothing when the last name is false. When a creditor files a UCC-1 financing statement, the debtor’s true last name is crucial because the financing statements are indexed by last names. A subsequent creditor who loans money to a debtor with the same name is put on notice that its lien is secondary.

The trial court here found that Corona Fruits & Veggies, Inc. and Corona Marketing Company (appellants), failed to perfect a security interest in a strawberry crop because its UCC-1 financing statement erroneously listed the debtor’s last name. We affirm. (Cal. U. Com. Code, §§ 9503, subd. (a)(4)(A), 9506, subd. (b).)

Facts and Procedural History

In 2001, appellants subleased farm land to a strawberry farmer (debtor) who went by the last name of “Munoz.” The sublease, as well as other documents given to appellants, stated that debtor’s name was “Armando Munoz Juarez.” That was and is his full true name. But he signed the sublease “Armando Munoz.”

Appellants advanced money for payroll and farm production expenses.…