In this note, Ryan Hackney examines the Uniform Commercial Code's treatment of so-called "dragnet" clauses in security agreements. Dragnet clauses--devices through which a creditor endeavors to tether collateral not merely to a presently contemplated loan, for which the security agreement is consideration, but to all loans made to a debtor, past and future--are explicitly authorized by the UCC with no meaningful restrictions. 

In taking such a wide stance, Hackney argues, the UCC's drafters have erred. Not only does the UCC's permissive position offer unscrupulous creditors a means by which to trap unwary debtors, it has also prompted many jurisdictions to depart from the drafters' clear intent, undermining the UCC's effort to promote national uniformity in commercial law. While Hackney believes that the current rule may be appropriate for nonconsumer transactions, in which the parties are presumed to be sophisticated, he maintains that the UCC must be amended to provide consumers with protection from the abusive use of dragnet clauses in order to address the legitimate concerns of dissenting jurisdictions.