Priority

Question 1

General Rule

Answer 1

First in time, first in right

Question 2

If collateral is instrument or chattel paper

Answer 2

Perfection by possession has priority over possession by filing

Question 3

PMSI Priority (non-inventory)

Answer 3

A PMSI prevails over an earlier perfected security interest if the PMSI is perfected:
1. when debtor gets possession of the collateral
2. within 20 days of debtor receiving possession

Question 4

PMSI Priority (inventory)

Answer 4

A PMSI prevails over an earlier perfected security interest if the PMSI is perfected:
1. when debtor gets possession of the collateral
2. within 20 days of debtor receiving possession
3. PMSI secured party notifies senior secured party in authenticated record that it is obtaining a PMSI in debtor’s collateral
4. be perfected when debtor receives possession of the inventory (no grace period)