CHAPTER 1. GENERAL PROVISIONS
IC 26
TITLE 26. COMMERCIAL LAW
IC 26-1
ARTICLE 1. UNIFORM COMMERCIAL CODE
IC 26-1-1
Chapter 1. General Provisions
IC 26-1-1-101
Short title; application
Sec. 101. (1) IC 26-1 shall be known and may be cited as Uniform
Commercial Code.
(2) IC 26-1 applies to a transaction to the extent that it is governed
by another article of the Uniform Commercial Code.
(Formerly: Acts 1963, c.317, s.1-101.) As amended by P.L.152-1986,
SEC.110; P.L.143-2007, SEC.1.
IC 26-1-1-102
Purposes; rules of construction; variation by agreement
Sec. 102. (1) IC 26-1 shall be liberally construed and applied to
promote its underlying purposes and policies.
(2) Underlying purposes and policies of IC 26-1 are:
(a) to simplify, clarify, and modernize the law governing
commercial transactions;
(b) to permit the continued expansion of commercial practices
through custom, usage, and agreement of the parties;
(c) to make uniform the law among the various jurisdictions.
(3) The effect of provisions of IC 26-1 may be varied by
agreement, except as otherwise provided in IC 26-1 and except that
the obligations of good faith, diligence, reasonableness, and care
prescribed by IC 26-1 may not be disclaimed by agreement, but the
parties may by agreement determine the standards by which the
performance of such obligations is to be measured, if such standards
are not manifestly unreasonable.
(4) The presence in certain provisions of IC 26-1 of the words
"unless otherwise agreed" or words of similar import does not imply
that the effect of other provisions may not be varied by agreement
under subsection (3).
(5) In IC 26-1, unless the context otherwise requires:
(a) words in the singular number include the plural, and in the
plural include the singular;
(b) words of the masculine gender include the feminine and the
neuter, and when the sense so indicates, words of the neuter
gender may refer to any gender.
(Formerly: Acts 1963, c.317, s.1-102.) As amended by P.L.152-1986,
SEC.111.
IC 26-1-1-103
Supplementary general principles of law applicable
Sec. 103. Unless displaced by the particular provisions of IC 26-1,
the principles of law and equity, including the law merchant and the
law relative to capacity to contract, principal and agent, estoppel,
fraud, misrepresentation, duress, coercion, mistake, bankruptcy, or
other validating or invalidating cause, shall supplement the
provisions of IC 26-1.
(Formerly: Acts 1963, c.317, s.1-103.) As amended by P.L.152-1986,
SEC.112.
IC 26-1-1-104
Construction against implicit repeal
Sec. 104. IC 26-1 being a general statute intended as a unified
coverage of its subject matter, no part of it shall be deemed to be
impliedly repealed by subsequent legislation if such construction can
reasonably be avoided.
(Formerly: Acts 1963, c.317, s.1-104.) As amended by P.L.152-1986,
SEC.113.
IC 26-1-1-105
Repealed
(Repealed by P.L.143-2007, SEC.78.)
IC 26-1-1-106
Remedies to be liberally administered
Sec. 106. (1) The remedies provided by IC 26-1 shall be liberally
administered to the end that the aggrieved party may be put in as
good a position as if the other party had fully performed, but neither
consequential or special nor penal damages may be had except as
specifically provided in IC 26-1 or by other rule of law.
(2) Any right or obligation declared by IC 26-1 is enforceable by
action unless the provision declaring it specifies a different and
limited effect.
(Formerly: Acts 1963, c.317, s.1-106.) As amended by P.L.152-1986,
SEC.114.
IC 26-1-1-107
Waiver or renunciation of claim or right after breach
Sec. 107. Any claim or right arising out of an alleged breach can
be discharged in whole or in part without consideration by a written
waiver or renunciation signed and delivered by the aggrieved party.
(Formerly: Acts 1963, c.317, s.1-107.)
IC 26-1-1-108
Severability
Sec. 108. The provisions of IC 26-1 are severable in the manner
provided by IC 1-1-1-8(b).
(Formerly: Acts 1963, c.317, s.1-108.) As amended by P.L.152-1986,
SEC.115.
IC 26-1-1-108.1
Powers of secretary of state; filing; acceptance of payment for fees
Sec. 108.1. (a) The secretary of state may provide that a document
required to be filed under this article with the secretary of state may
be filed by telecopy, facsimile, or other form of electronic
transmission meeting the requirements established by the secretary
of state.
(b) The secretary of state may accept payment of a filing fee for
a document filed by electronic transmission by credit card, debit
card, charge card, or similar method. However, if the filing fee is
paid by credit card, debit card, charge card, or similar method, the
liability is not finally discharged until the secretary of state receives
payment or credit from the institution responsible for making the
payment or credit.
(c) The secretary of state may contract with a bank or credit card
vendor for acceptance of bank or credit cards. However, if there is a
vendor transaction charge or discount fee, whether billed to the
secretary of state or charged directly to the secretary of state's
account, the secretary of state or the credit card vendor may collect
from the person using the bank or credit card a fee that may not
exceed the highest transaction charge or discount fee charged to the
secretary of state by the bank or credit card vendor during the most
recent collection period. The fee may be collected regardless of any
agreement between the bank and a credit card vendor or regardless
of any internal policy of the credit card vendor that may prohibit this
type of fee. The fee is a permitted additional charge under
IC 24-4.5-3-202.
As added by P.L.11-1996, SEC.33.
IC 26-1-1-108.2
Effect on Electronic Signatures in Global and National Commerce
Act
Sec. 108.2. This article modifies, limits, and supersedes the
Electronic Signatures in Global and National Commerce Act (15
U.S.C. 7001 et seq.).
However, this article does not:
(a) modify, limit, or supersede 15 U.S.C. 7001(c); or
(b) authorize the electronic delivery of a notice described in 15
U.S.C. 7003(b).
As added by P.L.143-2007, SEC.2.
IC 26-1-1-109
Repealed
(Repealed by P.L.16-1983, SEC.23(a).)
IC 26-1-1-201
General definitions
Sec. 201. Subject to additional definitions contained in IC 26-1-2
through IC 26-1-10 which are applicable to specific provisions, and
unless the context otherwise requires, in IC 26-1:
(1) "Action" in the sense of a judicial proceeding includes
recoupment, counterclaim, setoff, suit in equity, and any other
proceedings in which rights are determined.
(2) "Aggrieved party" means a party entitled to resort to a
remedy.
(3) "Agreement" means the bargain of the parties in fact as
found in their language or by implication from other
circumstances including course of dealing or usage of trade or
course of performance as provided in IC 26-1-1-205. Whether
an agreement has legal consequences is determined by the
provisions of IC 26-1, if applicable; otherwise by the law of
contracts (IC 26-1-1-103). (Compare "Contract".)
(4) "Bank" means a person engaged in the business of banking
and includes a savings bank, savings and loan association,
credit union, and trust company.
(5) "Bearer" means the person:
(A) in control of a negotiable electronic document of title; or
(B) in possession of a negotiable instrument, a negotiable
tangible document of title, or a certificated security payable
to bearer or endorsed in blank.
(6) "Bill of lading" means a document of title evidencing the
receipt of goods for shipment issued by a person engaged in the
business of directly or indirectly transporting or forwarding
goods. The term does not include a warehouse receipt. The term
includes an airbill. "Airbill" means a document serving for air
transportation as a bill of lading does for marine or rail
transportation, and includes an air consignment note or air
waybill.
(7) "Branch" includes a separately incorporated foreign branch
of a bank.
(8) "Burden of establishing" a fact means the burden of
persuading the triers of fact that the existence of the fact is more
probable than its nonexistence.
(9) "Buyer in ordinary course of business" means a person that
buys goods in good faith without knowledge that the sale
violates the rights of another person in the goods, and in the
ordinary course from a person, other than a pawnbroker, in the
business of selling goods of that kind. A person buys goods in
the ordinary course of business if the sale to the person
comports with the usual or customary practices in the kind of
business in which the seller is engaged or with the seller's own
usual or customary practices. A person that sells oil, gas, or
other minerals at the wellhead or minehead is a person in the
business of selling goods of that kind. A buyer in ordinary
course of business may buy for cash, by exchange of other
property, or on secured or unsecured credit, and may require
goods or documents of title under a preexisting contract for
sale. Only a buyer that takes possession of the goods or has a
right to recover the goods from that seller under IC 26-1-2 may
be a buyer in ordinary course of business. A person that
acquires goods in a transfer in bulk or as security for or total or
partial satisfaction of a money debt is not a buyer in ordinary
course of business.
(10) "Conspicuous". A term or clause is conspicuous when it is
so written that a reasonable person against whom it is to operate
ought to have noticed it. A printed heading in capitals (as:
NONNEGOTIABLE BILL OF LADING) is conspicuous.
Language in the body of a form is conspicuous if it is in larger
or other contrasting type or color. But in a telegram any stated
term is conspicuous. Whether a term or clause is conspicuous
or not is for decision by the court.
(11) "Contract" means the total legal obligation which results
from the parties' agreement as affected by this Act and any
other applicable rules of law. (Compare "Agreement".)
(12) "Creditor" includes a general creditor, a secured creditor,
a lien creditor and any representative of creditors, including an
assignee for the benefit of creditors, a trustee in bankruptcy, a
receiver in equity, and an executor or administrator of an
insolvent debtor's or assignor's estate.
(13) "Defendant" includes a person in the position of defendant
in a cross-action or counterclaim.
(14) "Delivery" means the following:
(A) With respect to an electronic document of title,
voluntary transfer of control.
(B) With respect to instruments, tangible documents of title,
chattel paper, or certificated securities, voluntary transfer of
possession.
(15) "Document of title" means a record that:
(A) in the regular course of business or financing, is treated
as adequately evidencing that the person in possession or
control of the record is entitled to receive, control, hold, and
dispose of the record and the goods it covers; and
(B) purports to be issued by or addressed to a bailee and
purports to cover goods in the bailee's possession which are
either identified or are fungible portions of an identified
mass.
The term includes a bill of lading, transport document, dock
warrant, dock receipt, warehouse receipt, or order for delivery
of goods. An electronic document of title means a document of
title evidenced by a record consisting of information stored in
an electronic medium. A tangible document of title means a
document of title evidenced by a record consisting of
information that is inscribed on a tangible medium.
(16) "Fault" means wrongful act, omission, or breach.
(17) "Fungible" with respect to goods or securities means goods
or securities of which any unit is, by nature or usage of trade,
the equivalent of any other like unit. Goods which are not
fungible shall be deemed fungible for the purposes of IC 26-1
to the extent that under a particular agreement or document
unlike units are treated as equivalents.
(18) "Genuine" means free of forgery or counterfeiting.
(19) "Good faith", except as otherwise provided by IC 26-1-4 or
IC 26-1-5.1, means honesty in fact and the observance of
reasonable commercial standards of fair dealing.
(20) "Holder" means:
(A) the person in possession of a negotiable instrument that
is payable either to bearer or to an identified person if the
identified person is in possession of the instrument;
(B) the person in possession of a negotiable tangible
document of title if the goods are deliverable either to bearer
or to the order of the person in possession; or
(C) the person in control of a negotiable electronic document
of title.
(21) To "honor" is to pay or to accept and pay or where a credit
so engages to purchase or discount a draft complying with the
terms of the credit.
(22) "Insolvency proceedings" includes any assignment for the
benefit of creditors or other proceedings intended to liquidate
or rehabilitate the estate of the person involved.
(23) A person is "insolvent" who either has ceased to pay the
person's debts in the ordinary course of business or cannot pay
the person's debts as they become due or is insolvent within the
meaning of the federal bankruptcy law.
(24) "Money" means a medium of exchange authorized or
adopted by a domestic or foreign government and includes a
monetary unit of account established by an intergovernmental
organization or by agreement between two (2) or more nations.
(25) A person has "notice" of a fact when:
(a) the person has actual knowledge of it;
(b) the person has received a notice or notification of it; or
(c) from all the facts and circumstances known to the person
at the time in question, the person has reason to know that it
exists.
A person "knows" or has "knowledge" of a fact when the person
has actual knowledge of it. "Discover" or "learn" or a word or
phrase of similar import refers to knowledge rather than to
reason to know. The time and circumstances under which a
notice or notification may cease to be effective are not
determined by IC 26-1.
(26) A person "notifies" or "gives" a notice or notification to
another by taking such steps as may be reasonably required to
inform the other in ordinary course whether or not such other
actually comes to know of it. A person "receives" a notice or
notification when:
(a) it comes to the person's attention; or
(b) it is duly delivered at the place of business through which
the contract was made or at any other place held out by the
person as the place for receipt of such communications.
(27) Notice, knowledge, or a notice of notification received by
an organization is effective for a particular transaction from the
time when it is brought to the attention of the individual
conducting that transaction and, in any event, from the time
when it would have been brought to the person's attention if the
organization had exercised due diligence. An organization
exercises due diligence if it maintains reasonable routines for
communicating significant information to the person conducting
the transaction and there is reasonable compliance with the
routines. Due diligence does not require an individual acting for
the organization to communicate information unless such
communication is part of the person's regular duties or unless
the person has reason to know of the transaction and that the
transaction would be materially affected by the information.
(28) "Organization" includes a corporation, government or
governmental subdivision or agency, business trust, estate, trust,
partnership or association, two (2) or more persons having a
joint or common interest, or any other legal or commercial
entity.
(29) "Party", as distinct from "third party", means a person who
has engaged in a transaction or made an agreement within
IC 26-1.
(30) "Person" includes an individual or an organization. (See
IC 26-1-1-102.)
(31) "Presumption" or "presumed" means that the trier of fact
must find the existence of the fact presumed unless and until
evidence is introduced which would support a finding of its
nonexistence.
(32) "Purchase" includes taking by sale, discount, negotiation,
mortgage, pledge, lien, security interest, issue or reissue, gift, or
any other voluntary transaction creating an interest in property.
(33) "Purchaser" means a person who takes by purchase.
(33a) "Registered mail" includes certified mail.
(33b) "Record", except as used in IC 26-1-1.5-2 and
IC 26-1-2.1-309, means information that is inscribed on a
tangible medium or that is stored in an electronic or other
medium and is retrievable in perceivable form.
(34) "Remedy" means any remedial right to which an aggrieved
party is entitled with or without resort to a tribunal.
(35) "Representative" includes an agent, an officer of a
corporation or association, and a trustee, executor, or
administrator of an estate, or any other person empowered to act
for another.
(36) "Rights" includes remedies.
(37) "Security interest" means an interest in personal property
or fixtures which secures payment or performance of an
obligation. The term also includes any interest of a consignor
and a buyer of accounts, chattel paper, a payment intangible, or
a promissory note in a transaction that is subject to IC 26-1-9.1.
The special property interest of a buyer of goods on
identification of such goods to a contract for sale under
IC 26-1-2-401 is not a security interest, but a buyer may also
acquire a security interest by complying with IC 26-1-9.1.
Except as otherwise provided in IC 26-1-2-505, the right of a
seller or lessor of goods under IC 26-1-2 or IC 26-1-2.1 to retain
or acquire possession of the goods is not a "security interest",
but a seller or lessor may also acquire a "security interest" by
complying with IC 26-1-9.1. The retention or reservation of title
by a seller of goods notwithstanding shipment or delivery to the
buyer (IC 26-1-2-401) is limited in effect to a reservation of a
"security interest". Whether a transaction creates a lease or
security interest is determined by the facts of each case.
However, a transaction creates a security interest if the
consideration the lessee is to pay the lessor for the right to
possession and use of the goods is an obligation for the term of
the lease not subject to termination by the lessee and:
(a) the original term of the lease is equal to or greater than
the remaining economic life of the goods;
(b) the lessee is bound to renew the lease for the remaining
economic life of the goods or is bound to become the owner
of the goods;
(c) the lessee has an option to renew the lease for the
remaining economic life of the goods for no additional
consideration or nominal additional consideration upon
compliance with the lease agreement; or
(d) the lessee has an option to become the owner of the
goods for no additional consideration or nominal additional
consideration upon compliance with the lease agreement.
A transaction does not create a security interest merely because
it provides that:
(a) the present value of the consideration the lessee is
obligated to pay the lessor for the right to possession and use
of the goods is substantially equal to or is greater than the
fair market value of the goods at the time the lease is entered
into;
(b) the lessee assumes risk of loss of the goods, or agrees to
pay taxes, insurance, filing, recording, or registration fees,
or service or maintenance costs with respect to the goods;
(c) the lessee has an option to renew the lease or to become
the owner of the goods;
(d) the lessee has an option to renew the lease for a fixed
rent that is equal to or greater than the reasonably
predictable fair market rent for the use of the goods for the
term of the renewal at the time the option is to be performed;
or
(e) the lessee has an option to become the owner of the
goods for a fixed price that is equal to or greater than the
reasonably predictable fair market value of the goods at the
time the option is to be performed.
For purposes of this subsection:
(x) Additional consideration is not nominal if:
(i) when the option to renew the lease is granted to the
lessee the rent is stated to be the fair market rent for the
use of the goods for the term of the renewal determined at
the time the option is to be performed; or
(ii) when the option to become the owner of the goods is
granted to the lessee the price is stated to be the fair
market value of the goods determined at the time the
option is to be performed.
Additional consideration is nominal if it is less than the
lessee's reasonably predictable cost of performing under the
lease agreement if the option is not exercised.
(y) "Reasonably predictable" and "remaining economic life
of the goods" are to be determined with reference to the facts
and circumstances at the time the transaction is entered into.
(z) "Present value" means the amount as of a date certain of
one (1) or more sums payable in the future, discounted to the
date certain. The discount is determined by the interest rate
specified by the parties if the rate is not manifestly
unreasonable at the time the transaction is entered into.
Otherwise, the discount is determined by a commercially
reasonable rate that takes into account the facts and
circumstances of each case at the time the transaction was
entered into.
(38) "Send" in connection with any writing or notice means to
deposit in the mail or deliver for transmission by any other
usual means of communication with postage or cost of
transmission provided for and properly addressed and, in the
case of an instrument, to an address specified thereon or
otherwise agreed or, if there be none, to any address reasonable
under the circumstances. The receipt of any writing or notice
within the time at which it would have arrived if properly sent
has the effect of a proper sending.
(39) "Signed" includes any symbol executed or adopted by a
party with present intention to authenticate a writing.
(40) "Surety" includes guarantor.
(41) "Telegram" includes a message transmitted by radio,
teletype, cable, any mechanical method of transmission, or the
like.
(42) "Term" means that portion of an agreement which relates
to a particular matter.
(43) "Unauthorized" signature means one made without actual,
implied, or apparent authority and includes a forgery.
(44) "Value". Except as otherwise provided with respect to
negotiable instruments and bank collections (IC 26-1-3.1-303,
IC 26-1-4-208, and IC 26-1-4-209) a person gives value for
rights if the person acquires them:
(a) in return for a binding commitment to extend credit or for
the extension of immediately available credit whether or not
drawn upon and whether or not a chargeback is provided for
in the event of difficulties in collection;
(b) as security for or in total or partial satisfaction of a
preexisting claim;
(c) by accepting delivery pursuant to a preexisting contract
for purchase; or
(d) generally, in return for any consideration sufficient to
support a simple contract.
(45) "Warehouse receipt" means a document of title issued by
a person engaged in the business of storing goods for hire.
(46) "Written" or "writing" includes printing, typewriting, or
any other intentional reduction to tangible form.
(Formerly: Acts 1963, c.317, s.1-201.) As amended by P.L.93-1985,
SEC.3; P.L.120-1987, SEC.46; P.L.3-1990, SEC.93; P.L.189-1991,
SEC.2; P.L.222-1993, SEC.1; P.L.57-2000, SEC.12; P.L.143-2007,
SEC.3; P.L.135-2009, SEC.1.
IC 26-1-1-202
Prima facie evidence by third party documents
Sec. 202. A document in due form purporting to be a bill of
lading, policy or certificate of insurance, official weigher's or
inspector's certificate, consular invoice, or any other document
authorized or required by the contract to be issued by a third party
shall be prima facie evidence of its own authenticity and genuineness
and of the facts stated in the document by the third party.
(Formerly: Acts 1963, c.317, s.1-202.)
IC 26-1-1-203
Obligation of good faith
Sec. 203. Every contract or duty within IC 26-1 imposes an
obligation of good faith in its performance or enforcement.
(Formerly: Acts 1963, c.317, s.1-203.) As amended by P.L.152-1986,
SEC.116.
IC 26-1-1-204
Time; reasonable time; "seasonably"
Sec. 204. (1) Whenever IC 26-1 requires any action to be taken
within a reasonable time, any time which is not manifestly
unreasonable may be fixed by agreement.
(2) What is a reasonable time for taking any action depends on the
nature, purpose, and circumstances of such action.
(3) An action is taken "seasonably" when it is taken at or within
the time agreed or, if no time is agreed, at or within a reasonable
time.
(Formerly: Acts 1963, c.317, s.1-204.) As amended by P.L.152-1986,
SEC.117.
IC 26-1-1-205
Course of dealing, course of performance, and usage of trade
Sec. 205. (1) A course of dealing is a sequence of previous
conduct between the parties to a particular transaction which is fairly
to be regarded as establishing a common basis of understanding for
interpreting their expressions and other conduct.
(2) A course of performance is a sequence of conduct between the
parties to a particular transaction that exists if the:
(a) agreement of the parties with respect to the transaction
involves repeated occasions for performance by a party; and
(b) other party, with knowledge of the nature of the
performance and opportunity for objection to it, accepts the
performance or acquiesces in it without objection.
(3) A usage of trade is any practice or method of dealing having
such regularity of observance in a place, vocation or trade as to
justify an expectation that it will be observed with respect to the
transaction in question. The existence and scope of such a usage are
to be proved as facts. If it is established that such a usage is
embodied in a written trade code or similar writing the interpretation
of the writing is for the court.
(4) A course of dealing or course of performance between parties
and any usage of trade in the vocation or trade in which they are
engaged or of which they are or should be aware give particular
meaning to and supplement or qualify terms of an agreement.
(5) Except as provided in subsection (8), the express terms of an
agreement and an applicable course of dealing, course of
performance, or usage of trade shall be construed wherever
reasonable as consistent with each other. If such a construction is
unreasonable:
(a) express terms prevail over course of dealing and course of
performance;
(b) course of performance prevails over course of dealing and
usage of trade; and
(c) course of dealing prevails over usage of trade.
(6) An applicable usage of trade in the place where any part of
performance is to occur shall be used in interpreting the agreement
as to that part of the performance.
(7) Evidence of a relevant usage of trade offered by one party is
not admissible unless and until the party has given the other party
such notice as the court finds sufficient to prevent unfair surprise to
the latter.
(8) Subject to IC 26-1-2-209, a course of performance is relevant
to show a waiver or modification of any term inconsistent with the
course of performance.
(Formerly: Acts 1963, c.317, s.1-205.) As amended by P.L.143-2007,
SEC.4.
IC 26-1-1-206
Statute of frauds for kinds of personal property not otherwise
covered
Sec. 206. (1) Except in the cases described in subsection (2), a
contract for the sale of personal property is not enforceable by way
of action or defense beyond five thousand dollars ($5,000) in amount
or value of remedy unless there is some writing which indicates that
a contract for sale has been made between the parties at a defined or
stated price, reasonably identifies the subject matter, and is signed by
the party against whom enforcement is sought or by his authorized
agent.
(2) Subsection (1) does not apply to contracts for the sale of goods
(IC 26-1-2-201) nor to security agreements (IC 26-1-9.1-201).
(Formerly: Acts 1963, c.317, s.1-206.) As amended by P.L.152-1986,
SEC.118; P.L.247-1995, SEC.2; P.L.57-2000, SEC.13.
IC 26-1-1-207
Performance or acceptance under reservation of rights
Sec. 207. (1) A party who, with explicit reservation of rights,
performs or promises performance or assents to performance in a
manner demanded or offered by the other party does not thereby
prejudice the rights reserved. Such words as "without prejudice",
"under protest" or the like are sufficient.
(2) Subsection (1) does not apply to an accord and satisfaction.
(Formerly: Acts 1963, c.317, s.1-207.) As amended by P.L.222-1993,
SEC.2.
IC 26-1-1-208
Option to accelerate at will
Sec. 208. A term providing that one party or his successor in
interest may accelerate payment or performance or require collateral
or additional collateral "at will" or "when he deems himself insecure"
or in words of similar import shall be construed to mean that he shall
have power to do so only if he in good faith believes that the
prospect of payment or performance is impaired. The burden of
establishing lack of good faith is on the party against whom the
power has been exercised.
(Formerly: Acts 1963, c.317, s.1-208.)
IC 26-1-1-301
Choice of law
Sec. 301. (1) Except as otherwise provided in this section, if a
transaction bears a reasonable relation to Indiana and also to another
state or nation, the parties may agree that the law either of Indiana or
of the other state or nation shall govern their rights and duties.
(2) In the absence of an agreement under subsection (1), and
except as provided in subsection (3), IC 26-1 applies to transactions
bearing an appropriate relation to Indiana.
(3) If any of the following provisions specifies the applicable law,
that provision governs, and a contrary agreement is effective only to
the extent permitted by the law so specified:
(a) IC 26-1-2-402.
(b) IC 26-1-2.1-105 and IC 26-1-2.1-106.
(c) IC 26-1-4-102.
(d) IC 26-1-4.1-507.
(e) IC 26-1-5.1-116.
(f) IC 26-1-8.1-110.
(g) IC 26-1-9.1-301 through IC 26-1-9.1-307.
As added by P.L.143-2007, SEC.5.
IC 26-1-1-302
Subordination
Sec. 302. (1) An obligation may be issued as subordinated to
performance of another obligation of the person obligated, or a
creditor may subordinate the creditor's right to performance of an
obligation by agreement with either the person obligated or another
creditor of the person obligated.
(2) Subordination does not create a security interest as against
either the common debtor or a subordinated creditor.
As added by P.L.143-2007, SEC.6.