47-9323. Future advances

421 words·~2 min read·/az/title-47/47-9323

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

A. Except as otherwise provided in subsection C of this section, for purposes of determining the priority of a perfected security interest under section 47-9322, subsection A, paragraph 1, perfection of the security interest dates from the time an advance is made to the extent that the security interest secures an advance that:

1. Is made while the security interest is perfected only:

(a)Under section 47-9309 when it attaches; or

(b)Temporarily under section 47-9312, subsection E, F or G; and

2. Is not made pursuant to a commitment entered into before or while the security interest is perfected by a method other than under section 47-9309 or section 47-9312, subsection E, F or G.

B. Except as otherwise provided in subsection C of this section, a security interest is subordinate to the rights of a person that becomes a lien creditor to the extent that the security interest secures an advance made more than forty-five days after the person becomes a lien creditor unless the advance is made:

1. Without knowledge of the lien; or

2. Pursuant to a commitment entered into without knowledge of the lien.

C. Subsections A and B of this section do not apply to a security interest held by a secured party that is a buyer of accounts, chattel paper, payment intangibles or promissory notes or a consignor.

D. Except as otherwise provided in subsection E of this section, a buyer of goods other than a buyer in ordinary course of business takes free of a security interest to the extent that it secures advances made after the earlier of:

1. The time the secured party acquires knowledge of the buyer's purchase; or

2. Forty-five days after the purchase.

E. Subsection D of this section does not apply if the advance is made pursuant to a commitment entered into without knowledge of the buyer's purchase and before the expiration of the forty-five day period.

F. Except as otherwise provided in subsection G of this section, a lessee of goods, other than a lessee in ordinary course of business, takes the leasehold interest free of a security interest to the extent that it secures advances made after the earlier of:

1. The time the secured party acquires knowledge of the lease; or

2. Forty-five days after the lease contract becomes enforceable.

G. Subsection F of this section does not apply if the advance is made pursuant to a commitment entered into without knowledge of the lease and before the expiration of the forty-five day period.