Secured Transactions Flashcards
Whose claim is superior between a prior owner whose property was stolen and a good faith purchaser of that property?
A purchaser of goods can only acquire the title that “his transferor had or had power to transfer.” As a result, a thief, who does not acquire title to goods when he steals them, is unable to transfer title to a purchaser, even if the purchaser buys in good faith and for value.
Can a secured party require direct payments from account debtors after default?
If a debtor defaults on a loan secured by an assignment of nongoods collateral, such as accounts or chattel paper, the creditor is entitled to notify the account debtor to make payment to the creditor, rather than to the debtor. Upon notification, the account debtor must pay the creditor rather than the debtor, even if the debtor was already making collections on the collateral.
A PMSI in inventory has “superpriority” over other security interests in the same inventory, regardless of the time of filing or perfection, if:
(I) the security interest is perfected at the time the debtor gets possession of the inventory, and
(II) other creditors with perfected security interests in the inventory receive authenticated notice of the PMSI before the debtor receives possession of the inventory.
A PMSI in equipment has superpriority over all other creditors in the same equipment if
the creditor perfects within 20 days after the debtor receives possession of the equipment.
conflict between a creditor with a PMSI in collateral and a lien creditor
if the PMSI creditor attaches its security interest before the lien arises, the PMSI creditor will prevail if it files within 20 days after the debtor receives the collateral
priority between a lien creditor and a perfected secured creditor that makes a future advance after the lien creditor levies on the collateral
If a creditor with a prior perfected security interest makes a future advance more than 45 days after the lien arises, the lien creditor will have priority in the future advances unless the future advance was made (i) without knowledge of the lien, or (ii) pursuant to a commitment made without knowledge of the lien.
