priority Flashcards
1
Q
Priority rules - secured v secured
A
- 1st to file or perfect wins (whichever occurs first)
- Between 2 unperfected, 1st to attach wins
- special rule - PMSI in goods not inventory or livestock (usually equipment) - PSMI has priority over a conflicting security interest in the same goods/proceeds IF PMSI is perfected at the time debtor receives possession of the collateral or within 20 days thereafter.
- special rule - PMSI v PMSI - seller-financed PMSI wins over financer-financed PMSI
- Other special priority - Control/time obtaining control/putting dep acct in own name/bank
2
Q
Priority rules - secured v unsecured
A
secured wins over unsecured
3
Q
Priority rules - secured v buyer
A
- General rule: sec int rides w/collateral
- Authorized sale exception: If sale is authorized by the secured party free of sec int, buyer takes from of sec int.
- Unauthorized sale: Buyer in the ordinary course of business takes free of a sec int created by the seller EVEN THOUGH the sec int is perfected and EVEN THOUGH the buyer knows if its existence
- Buyers not in the ordinary course of business take subject to perfected sec inst
- Special rule for consumer to consumer sales: Buyer takes free of sec int EVEN THOUGH perfected if he buys w/o knowledge of the sec int UNLESS secured party has filed a financing statement covering such goods. Must be consumer goods that Buyer must buy for value.
4
Q
Priority rules - secured v judgment lien holders
A
Unperfected sec int v JLH = JLH wins
perfected sec int v JLH = perfected sec int wins
Special rule: PMSI v lien creditor - PMSI wins over lien creditor
5
Q
Priority rules - secured v statutory lien claimants
A
statutory lien claimant wins over secured