PPSL Chapter 7-13 Final Study Flashcards

Who wins? Buyer vs unperfected Secured Party?

S. 20(b) says unperfected SI is subordinate to a buyer who gives value and is without knowledge.

What if there is temporary perfection? Who wins? Buyer or temp SP?

SS. 5(2), 26 and 51 - s. 5(2) relocation of property, a buyer of goods who acquires without knowledge gets priority when property relocation; s.26 instrument or certified security given to buyer by SP is temp perfected but subordinate to 30(5) - buyer who

Who wins in SP vs Buyer?

SP will win, unless the SP had authorized sale of the collateral (s.28(1)(a)says SP cannot claim the collateral from 3rd party if the SP authorized the dealing (nemo dat).

Who/when will a buyer have priority? (S.30) But also authorized sales s.28

1. Ordinary course buyer rule (s.30(2)) (OCB) - B prevails if goods sold in OCB.
2. Garage Sale Exception (s.30(3&4)) [consumer buyer rule]
3. Temporary perfection rules (s.30(5))
4. Buyer without knowledge (s.30(6))

What is covered by the ordinary course buyer rule?

Only covers goods sold or leased in ordinary course of biz of seller; buyer takes in ord course of biz of seller, then buyer takes goods without SI unless buyer knows sale = breach of SA. Be aware the B takes free of perfected/ unperfected SI given by S

What are the requirements in order for the ordinary course buyer priority rule to apply? What's the exception? (Cameco case)

1. Must be buyer or lessee of goods (+sale) 2. Must have been in the ordinary course of business of the seller Focus on the particular seller; 3. The SI must have been granted by the seller; 4. Buyer must have not had knowledge that the sale was in breach

What constitutes a sale worthy of the OCB rule?

A sale, in the OCB, includes a sale to the public at large, of the type normally made by the vendor in a particular business where the basic business dealings between buyer and seller are carried out under normal terms and consistent with general commerci

What is the garage sale exception?

If buyer is acquiring goods, then consumer buyer takes free from perfected or unperfected SI if for value less than $1k. MUST be consumer goods (only covers goods acquired by the buyer for personal, family, and household purposes).

Are the temporary perfection rules effective against a buyer?

No, not one without knowledge - buyer takes free from any SI that is temp perfected (the 15 day period only effective against trustee or another SP)

When will the buyer of equipment take free of any SI?

When the equipment is a serial number good and the SP didn't register

When will a perfected future advance SI take priority over a writ creditor (s.35)

only have priority over a writ creditor (judgement creditor) to the extent that the advances were made BEFORE the SP had knowledge (actual) of the writ, put differently SP won't have priority over writ creditor WRT future advances made after SP obtains kn