Malone v. Maxwell

WHITE, Judge.

This appeal concerns the question of whether a security agreement incorporating a “future advances” clause also secures a separate open account between the parties for purposes of the KRS 355.6-103(3) security interest exemption from the Bulk Sales Act.

The facts are quite simple and largely uncontroverted. On September 26, 1973, Robert G. King signed a promissory note and accompanying security agreement which was subsequently assigned to appellant Malone and Hyde, Inc. As defined in the security agreement, the term “secured party” included an assignee, such as Malone and Hyde,…