9-312. Priorities Among Conflicting Security Interests in
the Same Collateral.
(1) The rules of priority stated in other sections of this
Part and in the following sections shall govern when applicable:
Section 4-210 with respect to the security interests of
collecting banks in items being collected, accompanying documents
and proceeds; Section 9-103 on security interests related to
other jurisdictions; Section 9-114 on consignments.
(2) A perfected security interest in crops for new value
given to enable the debtor to produce the crops during the
production season and given not more than three months before the
crops become growing crops by planting or otherwise takes
priority over an earlier perfected security interest to the
extent that such earlier interest secures obligations due more
than six months before the crops become growing crops by planting
or otherwise, even though the person giving new value had
knowledge of the earlier security interest.
(3) A perfected purchase money security interest in
inventory has priority over a conflicting security interest in
the same inventory and also has priority in identifiable cash
proceeds received on or before the delivery of the inventory to a
buyer if
(a) the purchase money security interest is perfected at
the time the debtor receives possession of the inventory; and
(b) the purchase money secured party gives notification in
writing to the holder of the conflicting security interest if the
holder had filed a financing statement covering the same types of
inventory (i) before the date of the filing made by the purchase
money secured party, or (ii) before the beginning of the 21 day
period where the purchase money security interest is temporarily
perfected without filing or possession (subsection (5) of Section
9-304); and
(c) the holder of the conflicting security interest
receives the notification within five years before the debtor
receives possession of the inventory; and
(d) the notification states that the person giving the
notice has or expects to acquire a purchase money security
interest in inventory of the debtor, describing such inventory by
item or type.
(4) A purchase money security interest in collateral other
than inventory has priority over a conflicting security interest
in the same collateral or its proceeds if the purchase money
security interest is perfected at the time the debtor receives
possession of the collateral or within ten days thereafter.
(5) In all cases not governed by other rules stated in this
section (including cases of purchase money security interests which do not qualify for the special priorities set forth in subsections (3) and (4) of this section), priority between conflicting security interests in the same collateral shall be determined according to the following rules:
(a) Conflicting security interests rank according to
priority in time of filing or perfection. Priority dates from the
time a filing is first made covering the collateral or the time
the security interest is first perfected, whichever is earlier,
provided that there is no period thereafter when there is neitherfiling nor perfection.
(b) So long as conflicting security interests are
unperfected, the first to attach has priority.
(6) For the purposes of subsection (5) a date of filing or
perfection as to collateral is also a date of filing or
perfection as to proceeds.
(7) If future advances are made while a security interest
is perfected by filing, the taking of possession, or under
Section 8-321 on securities, the security interest has the same
priority for the purposes of subsection (5) with respect to the
future advances as it does with respect to the first advance. If
a commitment is made before or while the security interest is so
perfected, the security interest has the same priority with
respect to advances made pursuant thereto. In other cases a
perfected security Interest has priority from the date the
advance is made.
9-313. Priority of Security Interests in Fixtures.
(1) In this section and in the provisions of Part 4 of this
Article referring to fixture filing, unless the context otherwise
requires (a) goods are "fixtures" when they become so related to
particular real estate that an interest in them arises under real
estate law
(b) a "fixture filing" is the filing in the office where a
mortgage on the real estate would be filed or recorded of a
financing statement covering goods which are or are to become
fixtures and conforming to the requirements of subsection (5) of Section 9-402
(c) a mortgage is a "construction mortgage" to the extent that it secures an obligation incurred for the construction of an
improvement on land including the acquisition cost of the land,
if the recorded writing so indicates.
(2) A security interest under this Article may be created
in goods which are fixtures or may continue in goods which become
fixtures, but no security interest exists under this Article in
ordinary building materials incorporated into an improvement on
land.
(3) This Article does not prevent creation of an
encumbrance upon fixtures pursuant to real estate law.
(4) A perfected security interest in fixtures has priority
over the conflicting interest of an encumbrancer or owner of the
real estate where
(a) the security interest is a purchase money security
interest, the interest of the encumbrancer or owner arises before
the goods become fixtures, the security interest is perfected by
a fixture filing before the goods become fixtures or within ten
days thereafter, and the debtor has an interest of record in the
real estate or is in possession of the real estate; or
(b) the security interest is perfected by a fixture filing
before the interest of the encumbrancer or owner is of record,
the security interest has priority over any conflicting interest
of a predecessor in title of the encumbrancer or owner, and the
debtor has an interest of record in the real estate or is in
possession of the real estate; or
(c) the fixtures are readily removable factory or office
machines or readily removable replacements of domestic appliances
which are consumer goods, and before the goods become fixtures the security interest is perfected by any method permitted by this Article; or
(d) the conflicting interest is a lien on the real estate
obtained by legal or equitable proceedings after the security
interest was perfected by any method permitted by this Article.
(5) A security interest in fixtures, whether or not
perfected, has priority over the conflicting interest of an
encumbrancer or owner of the real estate where
(a) the encumbrancer or owner has consented in writing to
the security interest or has disclaimed an interest in the goods
as fixtures; or
(b) the debtor has a right to remove the goods as against
the encumbrancer or owner. If the debtor's right terminates, the
priority of the security interest continues for a reasonable
time.
(6) Notwithstanding paragraph (a) of subsection (4) but
otherwise subject to subsections (4) and (5), a security interest
in fixtures is subordinate to a construction mortgage recordedbefore the goods become fixtures if the goods become fixtures
before the completion of the construction. To the extent that it
is given to refinance a construction mortgage, a mortgage has
this priority to the same extent as the construction mortgage.
(7) In cases not within the preceding subsections, a
security interest in fixtures is subordinate to the conflicting
Interest of an encumbrancer or Owner of the related real estate
who is not the debtor.
(8) When the secured party has priority over all Owners and
encumbrancers of the real estate, he may, on default, subject to
the provisions of part 5, remove his collateral from the real
estate but he must reimburse any encumbrancer or owner of the
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