12A:9-325 Priority of security interests in transferred collateral.
12A:9-325. Priority of Security Interests in Transferred Collateral.
(a) Subordination of security interest in transferred collateral. Except as otherwise provided in subsection (b), a security interest created by a debtor is subordinate to a security interest in the same collateral created by another person if:
(1) the debtor acquired the collateral subject to the security interest created by the other person;
(2) the security interest created by the other person was perfected when the debtor acquired the collateral; and
(3) there is no period thereafter when the security interest is unperfected.
(b) Limitation of subsection (a) subordination. Subsection (a) subordinates a security interest only if the security interest:
(1) otherwise would have priority solely under 12A:9-322 (a) or 12A:9-324; or
(2) arose solely under 12A:2-711(3) or 12A:2A-508(5).
L.2001, c.117, s.1; amended 2001, c.386, s.41.