§ 41-09-42 — (9-322) Priorities among conflicting security interests in and agricultural liens on same collateral

North Dakota § 41-09-42

• Jurisdiction: North Dakota
• Title 41: Uniform Commercial Code
• Ch. 41-09: Secured Transactions

Text

liens on same collateral.
1. Except as otherwise provided in this section, priority among conflicting security
interests and agricultural liens in the same collateral is determined according to the
following rules:
a. Conflicting perfected security interests and agricultural liens rank according to
priority in time of filing or perfection. Priority dates from the earlier of the time a
filing covering the collateral is first made or the security interest or agricultural lien
is first perfected, if there is no period thereafter when there is neither filing nor
perfection.
b. A perfected security interest or agricultural lien has priority over a conflicting
unperfected security interest or agricultural lien.
c. The first security interest or agricultural lien to attach or become effective has
priority if conflicting security interests and agricultural liens are unperfected.
2. For the purposes of subdivision a of subsection 1:
a. The time of filing or perfection as to a security interest in collateral is also the time
of filing or perfection as to a security interest in proceeds; and

b. The time of filing or perfection as to a security interest in collateral supported by a
supporting obligation is also the time of filing or perfection as to a security interest
in the supporting obligation.
3. Except as otherwise provided in subsection 6, a security interest in collateral which
qualifies for priority over a conflicting security interest under section 41-09-47,
41-09-48, 41-09-49, 41-09-50, or 41-09-51 also has priority over a conflicting security
interest in:
a. Any supporting obligation for the collateral; and
b. Proceeds of the collateral if:
(1) The security interest in proceeds is perfected;
(2) The proceeds are cash proceeds or of the same type as the collateral; and
(3) In the case of proceeds that are proceeds of proceeds, all intervening
proceeds are cash proceeds, proceeds of the same type as the collateral, or
an account relating to the collateral.
4. Subject to subsection 5 and except as otherwise provided in subsection 6, if a security
interest in chattel paper, deposit accounts, negotiable documents, instruments,
investment property, or letter-of-credit rights is perfected by a method other than filing,
conflicting perfected security interests in proceeds of the collateral rank according to
priority in time of filing.
5. Subsection 4 applies only if the proceeds of the collateral are not cash proceeds,
chattel paper, negotiable documents, instruments, investment property, or
letter-of-credit rights.
6. Subsections 1 through 5 are subject to:
a. Subsection 7 and the other provisions of this part;
b. Section 41-04-22 with respect to a security interest of a collecting bank;
c. Section 41-05-18 with respect to a security interest of an issuer or nominated
person; and
d. Section 41-09-10 with respect to a security interest arising under chapter 41-02 or
41-02.1.
7. A perfected agricultural lien on collateral has priority over the conflicting rights of a lien
creditor and over a conflicting security interest in or agricultural lien on the same
collateral if the statute creating the agricultural lien so provides.