Note:
Philip T. Billard, Bankrupting the Proceeds Section: Recent Interpretations of Section 9-306(4)(d) of the Uniform Commercial Code, 55 TEXAS L. REV. 891 (1977).
 

Abstract:
This Note discusses the questions left open by conflicting Ninth and Seventh Circuit interpretations of the Uniform Commercial Code section 9-306(4)(d), which establishes a perfected security interest in all cash and bank accounts of the debtor, if other cash proceeds have been commingled or deposited in a bank account. The Seventh Circuit held in Fitzpatrick v. Philco Finance Corp. that cash proceeds refers only to cash proceeds derived from the sale of collateral subject to the creditor’s security interest. The Ninth Circuit, on the other hand, held in In re Gibson Products that cash proceeds refers to all cash receipts from whatever source derived. Billiard examines the support for these two conflicting interpretations in light of the statutory construction. He further questions the legal and practical consequences of each of the interpretations. Ultimately he finds the Seventh Circuits approach more persuading and promising.