TITLE 6A
Uniform Commercial Code
CHAPTER 6A-9
Secured Transactions
PART 6A-9-301
Perfection and Priority
SECTION 6A-9-334
§ 6A-9-334 Priority of security interests
in fixtures and crops.
(a) Security interest in fixtures under this chapter. A security
interest under this chapter may be created in goods that are fixtures or may
continue in goods that become fixtures. A security interest does not exist
under this chapter in ordinary building materials incorporated into an
improvement on land.
(b) Security interest in fixtures under real-property
law. This chapter does not prevent creation of an encumbrance upon fixtures
under real property law.
(c) General rule: subordination of security interest in
fixtures. In cases not governed by subsections (d) through (h), 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) Fixtures purchase-money priority. Except as
otherwise provided in subsection (h), 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 20 days thereafter.
(e) Priority of security interest in fixtures over
interests in real property. 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:
(i) Is perfected by a fixture filing before the interest of
the encumbrancer or owner is of record; and
(ii) 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 this chapter and the fixtures are
readily removable:
(i) Factory or office machines;
(ii) Equipment that is not primarily used or leased for use
in the operation of the real property; or
(iii) 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 chapter; or
(4) The security interest is:
(i) Created in a manufactured home in a manufactured-home
transaction; and
(ii) Perfected pursuant to a statute described in §
6A-9-311(a)(2).
(f) Priority based on consent, disclaimer, or right to
remove. 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 an authenticated
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) Continuation of paragraph (f)(2) priority. The
priority of the security interest under paragraph (f)(2) continues for a
reasonable time if the debtor's right to remove the goods as against the
encumbrancer or owner terminates.
(h) Priority of construction mortgage. 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), 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.
(i) Priority of security interest in crops. A
perfected security interest in crops growing on real property 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.
History of Section.
(P.L. 2000, ch. 182, § 6; P.L. 2000, ch. 420, § 6.)