Priority

Question 1

General

Answer 1

We are now dealing w/a situation where the secured party & some 3rd party are claiming the same collateral. Fight Rules.

Question 2

Secured Party v. Secured Party

Answer 2

General Rule = As between 2 perfected secured creditors, the 1st to FILE OR PERFECT whichever occurs 1st, has priority

SPECIAL Rules:

• PMSI jumps ahead to conflict security interest (in goods other than inventory or livestock): 20 days
• Same as above in inventory or livestock: notice 5 years
• Conflicting PMSI = Seller over financer
• Special priority rules for investment property
• Special priority rules for deposit accounts
  
  • Super Sexy (See pg. 24)

Question 3

Secured Party v. Buyer of the Collateral

Answer 3

General Rule: If you buy something w/a security interest on it, the security interest stays on it.

Few Exceptions:

(1) Authorized sales = Secured creditor authorizes debtor to sell
(2) Unauthorized sales = Buyer in the ordinary course of business takes free of a security interested created by his seller even though the security interest is perfected and even though the buyer knows of its existence

See Pg. 27

Question 4

Secured Party v. Judgment Lien Holders

Answer 4

An unsecured creditor who has obtained a judgment and has levied on that judgment is a “lien creditor”

• judgment wins
• Special rules PMSI v. Lien Creditor; Future advances

Question 5

Secured party v. statutory lien claimants

Answer 5

Statutory lien wins (Even perfected secured creditor)