Gallatin National Bank v. Lockovich
United States District Court for the Western District of Pennsylvania
124 B.R. 660 (1991)
John and Clara Lockovich (plaintiffs, in bankruptcy) bought a 22-foot, $32,000 boat from Greene County Yacht Club for personal use, granting a security interest that Greene assigned to Gallatin National Bank (defendant); after the Lockoviches defaulted and filed Chapter 11 bankruptcy, the bankruptcy court found Gallatin's security interest unperfected because it never filed a financing statement, treating Gallatin as an unsecured creditor. Gallatin appealed, arguing the boat was a consumer good subject to automatic perfection of a purchase-money security interest under the UCC, making a financing statement unnecessary.
Whether an item's purchase price is relevant to whether it qualifies as a consumer good under the UCC, automatically perfecting a purchase-money security interest without a financing statement.