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New York Consignment Case Illustrates Danger Of After-Acquired Property Clauses

LexisNexis (August 1, 2017, 1:35 PM EDT) -- A New York bankruptcy case decided in 2014 has begun to draw the attention of secured lenders who routinely use supergeneric collateral descriptions, such as "All Personal Property Now Owned or Hereafter Acquired by the Debtor,"  in their financing statements.  The New York case holds that the consignor of a  $9.5 million dollar Botticelli painting had priority to the masterpiece over the consignee's secured lender who claimed it as collateral. (The lender had assigned its secured position to the consignee's trustee in bankruptcy.)  

The federal district...
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