When Security Interest or Agricultural Lien Is Perfected; Continuity of Perfection

  1. Law
  2. Georgia Code
  3. Commercial Code
  4. Secured Transactions
  5. Perfection and Priority
  6. When Security Interest or Agricultural Lien Is Perfected; Continuity of Perfection

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  1. Perfection of security interest. Except as otherwise provided in this Code section and Code Section 11-9-309, a security interest is perfected if it has attached and all of the applicable requirements for perfection in Code Sections 11-9-310 through 11-9-316 have been satisfied. A security interest is perfected when it attaches if the applicable requirements are satisfied before the security interest attaches.
  2. Perfection of agricultural lien. An agricultural lien is perfected if it has become effective and all of the applicable requirements for perfection in Code Section 11-9-310 have been satisfied. An agricultural lien is perfected when it becomes effective if the applicable requirements are satisfied before the agricultural lien becomes effective.
  3. Continuous perfection; perfection by different methods. A security interest or agricultural lien is perfected continuously if it is originally perfected by one method under this article and is later perfected by another method under this article, without an intermediate period when it was unperfected.
  4. Supporting obligation. Perfection of a security interest in collateral also perfects a security interest in a supporting obligation for the collateral.
  5. Lien securing right to payment. Perfection of a security interest in a right to payment or performance also perfects a security interest in a security interest, mortgage, or other lien on personal or real property securing the right.
  6. Security entitlement carried in securities account. Perfection of a security interest in a securities account also perfects a security interest in the security entitlements carried in the securities account.
  7. Commodity contract carried in commodity account. Perfection of a security interest in a commodity account also perfects a security interest in the commodity contracts carried in the commodity account.

(Code 1981, §11-9-308, enacted by Ga. L. 2001, p. 362, § 1.)

Cross references.

- When instruments requiring recording take effect, § 44-2-2.

Law reviews.

- For note examining the conflict between the floating lien in after-acquired property under the Uniform Commercial Code and the voidable preferences provisions of the Bankruptcy Act, see 9 Ga. L. Rev. 685 (1975).

JUDICIAL DECISIONS

Editor's notes.

- In the light of the similarity of the provisions, decisions under former Article 9 are included in the annotations for this Code section. For a table of comparable provisions, see the table at the beginning of the Article.

Perfection, generally.

- Security interest is perfected when it has attached under former § 11-9-204(1) and when all applicable steps required for perfection have been taken under former § 11-9-312(4). Continental Oil Co. Agrico Chem. Co. Div. v. Sutton, 126 Ga. App. 78, 189 S.E.2d 925 (1972) (decided under former Code Section11-9-303).

To perfect a purchase money security interest and for it to be enforceable against debtor and third parties, there must be a written agreement, signed by debtor under former § 11-9-203(1)(b) and filing of financing statement under former § 11-9-302(1). Food Serv. Equip. Co. v. First Nat'l Bank, 121 Ga. App. 421, 174 S.E.2d 216 (1970) (decided under former Code Section11-9-303).

Judgment on note.

- Judgment on debt for unpaid balance on note does not in itself operate to perfect security interest in collateral listed on note, and payee's rights are subordinate to those of lien creditor who has no knowledge of security interest. Fas-Pac, Inc. v. Fillingame, 123 Ga. App. 203, 180 S.E.2d 243 (1971) (decided under former Code Section11-9-303).

Extent of security interest.

- In absence of special circumstances, security interest can attach only to extent of debtor's interest. First Nat'l Bank & Trust Co. v. Smithloff, 119 Ga. App. 284, 167 S.E.2d 190 (1969) (decided under former Code Section11-9-303).

Perfected security interest had priority over attempted reservation of title.

- Peanut growers' attempted reservation of title when the growers delivered peanuts to a peanut company at a peanut broker's direction amounted to a security interest; however, the growers never perfected the growers' security interests. a cooperative bank's security interest in the peanuts was perfected as the growers had filed financing statements and the security interest had attached so that the bank's perfected security interest had priority over the growers' unperfected security interests. Farm Credit of Northwest Fla., ACA v. Easom Peanut Co., 312 Ga. App. 374, 718 S.E.2d 590 (2011), cert. denied, No. S12C0444, 2012 Ga. LEXIS 315 (Ga. 2012).

Cited in Mack Trucks, Inc. v. Ryder Truck Rental, Inc., 110 Ga. App. 68, 137 S.E.2d 718 (1964); Green v. King Edward Employees' Fed. Credit Union, 373 F.2d 613 (5th Cir. 1967); Johnson v. Dempsey, 117 Ga. App. 722, 161 S.E.2d 889 (1968); First Nat'l Bank & Trust Co. v. McElmurray, 120 Ga. App. 134, 169 S.E.2d 720 (1969); Bank of Madison v. Tri-County Livestock Auction Co., 123 Ga. App. 768, 182 S.E.2d 687 (1971); Enterprises Now, Inc. v. Citizens & S. Dev. Corp., 135 Ga. App. 602, 218 S.E.2d 309 (1975); Tuftco Sales Corp. v. Garrison Carpet Mills, Inc., 158 Ga. App. 674, 282 S.E.2d 159 (1981); GTE Leasing Corp. v. Load-It, Inc., 860 F.2d 393 (11th Cir. 1988); Southern Horizons Aviation v. F & M Bank, 231 Ga. App. 55, 497 S.E.2d 637 (1998).

RESEARCH REFERENCES

Am. Jur. 2d.

- 68A Am. Jur. 2d, Secured Transactions, §§ 288-293, 310, 311, 412-448.

C.J.S.

- 6A C.J.S., Assignments, §§ 79, 80, 85. 72 C.J.S., Pledges, § 22.

U.L.A.

- Uniform Commercial Code (U.L.A.) § 9-308.


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