§ 55-9-334 — Priority of security interests in fixtures

New Mexico § 55-9-334

• Jurisdiction: New Mexico
• Ch. 55: Uniform Commercial Code
• Art. 9: Secured Transactions

Text

(a) A security interest under Chapter 55, Article 9 NMSA 1978 may be created in goods that are fixtures or may continue in goods that become fixtures. A security interest does not exist under this article in ordinary building materials incorporated into an improvement on land. (b) Chapter 55, Article 9 NMSA 1978 does not prevent creation of an encumbrance upon fixtures under real property law. (c) In cases not governed by Subsections (d) through (h) of this section, a security interest in fixtures is subordinate to a conflicting interest of an encumbrancer or owner of the related real property other than the debtor. (d) Except as otherwise provided in Subsection (h) of this section, a perfected security interest in fixtures has priority over a conflicting interest of an encumbrancer or owner of the real property if the debtor has an interest of record in or is in possession of the real property and: (1) the security interest is a purchase-money security interest; (2) the interest of the encumbrancer or owner arises before the goods become fixtures; and (3) the security interest is perfected by a fixture filing before the goods become fixtures or within twenty days thereafter. (e) A perfected security interest in fixtures has priority over a conflicting interest of an encumbrancer or owner of the real property if: (1) the debtor has an interest of record in the real property or is in possession of the real property and the security interest: (A) is perfected by a fixture filing before the interest of the encumbrancer or owner is of record; and (B) has priority over any conflicting interest of a predecessor in title of the encumbrancer or owner; (2) before the goods become fixtures, the security interest is perfected by any method permitted by Chapter 55, Article 9 NMSA 1978, and the fixtures are readily removable: (A) factory or office machines; (B) equipment that is not primarily used or leased for use in the operation of the real property; or (C) replacements of domestic appliances that are consumer goods; (3) the conflicting interest is a lien on the real property obtained by legal or equitable proceedings after the security interest was perfected by any method permitted by this article; or (4) the security interest is: (A) created in a manufactured home in a manufactured-home transaction; and (B) perfected pursuant to a statute described in Paragraph (2) of Subsection (a) of Section 55-9-311 NMSA 1978. (f) A security interest in fixtures, whether or not perfected, has priority over a conflicting interest of an encumbrancer or owner of the real property if: (1) the encumbrancer or owner has, in a signed record, consented to the security interest or disclaimed an interest in the goods as fixtures; or (2) the debtor has a right to remove the goods as against the encumbrancer or owner. (g) The priority of the security interest under Paragraph (2) of Subsection (f) of this section continues for a reasonable time if the debtor's right to remove the goods as against the encumbrancer or owner terminates. (h) A mortgage is a construction mortgage to the extent that it secures an obligation incurred for the construction of an improvement on land, including the acquisition cost of the land, if a recorded record of the mortgage so indicates. Except as otherwise provided in Subsections (e) and (f) of this section, a security interest in fixtures is subordinate to a construction mortgage if a record of the mortgage is recorded before the goods become fixtures and the goods become fixtures before the completion of the construction. A mortgage has this priority to the same extent as a construction mortgage to the extent that it is given to refinance a construction mortgage.

Legislative History

1978 Comp., § 55-9-334, enacted by Laws 2001, ch. 139, § 54; 2023, ch. 142,