If a security interest or agricultural lien is perfected by a filed financing statement providing information described in subdivision (5) of subsection (b) of section 42a-9-516 which is incorrect at the time the financing statement is filed:
(1) The security interest or agricultural lien is subordinate to a conflicting perfected security interest in the collateral to the extent that the holder of the conflicting security interest gives value in reasonable reliance upon the incorrect information; and
(2) A purchaser, other than a secured party, of the collateral takes free of the security interest or agricultural lien to the extent that, in reasonable reliance upon the incorrect information, the purchaser gives value and, in the case of tangible chattel paper, tangible documents, goods, instruments or a security certificate, receives delivery of the collateral.
(P.A. 01-132, S. 58; P.A. 04-64, S. 71.)
History: P.A. 04-64 added references to “tangible” chattel paper and documents in Subdiv. (2) to conform to revisions made to article 7 by the same act.