2007 Minnesota Statutes

336.9-330 PRIORITY OF PURCHASER OF CHATTEL PAPER OR INSTRUMENT.
(a) Purchaser's priority: security interest claimed merely as proceeds. A purchaser of
chattel paper has priority over a security interest in the chattel paper which is claimed merely as
proceeds of inventory subject to a security interest if:
(1) in good faith and in the ordinary course of the purchaser's business, the purchaser gives
new value and takes possession of the chattel paper or obtains control of the chattel paper under
section 336.9-105; and
(2) the chattel paper does not indicate that it has been assigned to an identified assignee
other than the purchaser.
(b) Purchaser's priority: other security interests. A purchaser of chattel paper has priority
over a security interest in the chattel paper which is claimed other than merely as proceeds of
inventory subject to a security interest if the purchaser gives new value and takes possession of
the chattel paper or obtains control of the chattel paper under section 336.9-105 in good faith,
in the ordinary course of the purchaser's business, and without knowledge that the purchase
violates the rights of the secured party.
(c) Chattel paper purchaser's priority in proceeds. Except as otherwise provided in
section 336.9-327, a purchaser having priority in chattel paper under subsection (a) or (b) also
has priority in proceeds of the chattel paper to the extent that:
(1) section 336.9-322 provides for priority in the proceeds; or
(2) the proceeds consist of the specific goods covered by the chattel paper or cash proceeds
of the specific goods, even if the purchaser's security interest in the proceeds is unperfected.
(d) Instrument purchaser's priority. Except as otherwise provided in section 336.9-331(a),
a purchaser of an instrument has priority over a security interest in the instrument perfected by a
method other than possession if the purchaser gives value and takes possession of the instrument
in good faith and without knowledge that the purchase violates the rights of the secured party.
(e) Holder of purchase-money security interest gives new value. For purposes of
subsections (a) and (b), the holder of a purchase-money security interest in inventory gives new
value for chattel paper constituting proceeds of the inventory.
(f) Indication of assignment gives knowledge. For purposes of subsections (b) and (d), if
chattel paper or an instrument indicates that it has been assigned to an identified secured party
other than the purchaser, a purchaser of the chattel paper or instrument has knowledge that the
purchase violates the rights of the secured party.
History: 2000 c 399 art 1 s 50