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Tennessee Code Title 47. Commercial Instruments and Transactions § 47-9-323

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(a) When priority based on time of advance.  Except as otherwise provided in subsection (c), for purposes of determining the priority of a perfected security interest under § 47-9-322(a)(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 § 47-9-309 when it attaches;  or

(B) temporarily under § 47-9-312(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 § 47-9-309 or § 47-9-312(e), (f), or (g).

(b) Lien creditor.  Except as otherwise provided in subsection (c), 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 45 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) Buyer of receivables.  Subsections (a) and (b) 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) Buyer of goods.  Except as otherwise provided in subsection (e), 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) 45 days after the purchase.

(e) Advances made pursuant to commitment:  priority of buyer of goods.  Subsection (d) 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 45-day period.

(f) Lessee of goods.  Except as otherwise provided in subsection (g), 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) 45 days after the lease contract becomes enforceable.

(g) Advances made pursuant to commitment:  priority of lessee of goods.  Subsection (f) 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 45-day period.

Cite this article: FindLaw.com - Tennessee Code Title 47. Commercial Instruments and Transactions § 47-9-323 - last updated January 01, 2020 | https://codes.findlaw.com/tn/title-47-commercial-instruments-and-transactions/tn-code-sect-47-9-323.html


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