I. Introduction

II. The Hypothetical Case

III. The U.C.C. and Equitable Subrogation ... A. The Bank Has Superior Claims to the Contractor's Assets under the U.C.C. ... B. The Doctrine of Equitable Subrogation ... C. The Tension between the U.C.C. and Equitable Subrogation ... 1. Equitable Subrogation Was Not Replaced by the U .C.C ... 2. Weaknesses of Equitable Subrogation ... 3. Potential Uses of the U.C.C. by Sureties

IV. Analysis of the Hypothetical ... A. Who Gets the Contract Balance? ... 1. Rights under the U.C.C. ... 2. Completion of Performance ... 3. Governing Law ... 4. Conclusions as to Contract Balances ... B. Who Gets the Materials? ... 1. The Bank Has a Perfected Security Interest in the Materials ... 2. The Owner May Have Rights Superior to the Bank's Interest ... 3. The Surety Has No Enforceable Claims to Materials under Equitable Subrogation ... 4. The Surety Has Problems Even If It Filed Its Indemnity Agreement under the U.C.C. ... 5. Conclusion—Materials ... C. Who Gets the Equipment? ... 1. The Bank Has Superior Rights to the Equipment … 2. Equitable Subrogation Does Not Give the Surety Any Rights to Contractor's Equipment ... 3. Filing under the U.C.C. Would Have Given the Surety Rights in the Equipment ... 4. Conclusion—Equipment

V. What Are the Advantages and Disadvantages of Recording the Indemnity Agreement under the U.C.C.? … A. Advantages of Filing under the U.C.C. ... B. Disadvantages of Filing under the U.C.C. ... C. Filing after Default ... D. Filing When Necessary under the Circumstances May Be the Best Solution

VI. Conclusion