2000 Minnesota Statutes

     336.9-315 Secured party's rights on disposition of 
  collateral and in proceeds. 

    (a)    Disposition of collateral:  continuation of 
 security interest or agricultural lien; proceeds.  Except as 
 otherwise provided in this article and in section 336.2-403(2): 

    (1) a security interest or agricultural lien continues in 
 collateral notwithstanding sale, lease, license, exchange, or 
 other disposition thereof unless the secured party authorized 
 the disposition free of the security interest or agricultural 
 lien; and 

    (2) a security interest attaches to any identifiable 
 proceeds of collateral. 

    (b)    When commingled proceeds identifiable.  Proceeds 
 that are commingled with other property are identifiable 
 proceeds: 

    (1) if the proceeds are goods, to the extent provided by 
 section 336.9-336; and 

    (2) if the proceeds are not goods, to the extent that the 
 secured party identifies the proceeds by a method of tracing, 
 including application of equitable principles, that is permitted 
 under law other than this article with respect to commingled 
 property of the type involved. 

    (c)    Perfection of security interest in proceeds.  A 
 security interest in proceeds is a perfected security interest 
 if the security interest in the original collateral was 
 perfected. 

    (d)    Continuation of perfection.  A perfected security 
 interest in proceeds becomes unperfected on the 21st day after 
 the security interest attaches to the proceeds unless: 

    (1) the following conditions are satisfied: 

    (A) a filed financing statement covers the original 
 collateral; 

    (B) the proceeds are collateral in which a security 
 interest may be perfected by filing in the office in which the 
 financing statement has been filed; and 

    (C) the proceeds are not acquired with cash proceeds; 

    (2) the proceeds are identifiable cash proceeds; or 

    (3) the security interest in the proceeds is perfected 
 other than under subsection (c) when the security interest 
 attaches to the proceeds or within 20 days thereafter. 

    (e)    When perfected security interest in proceeds 
 becomes unperfected.  If a filed financing statement covers 
 the original collateral, a security interest in proceeds which 
 remains perfected under subsection (d)(1) becomes unperfected at 
 the later of: 

    (1) when the effectiveness of the filed financing statement 
 lapses under section 336.9-515 or is terminated under section 
 336.9-513; or 

    (2) the 21st day after the security interest attaches to 
 the proceeds. 

    HIST: 2000 c 399 art 1 s 35 

*   NOTE:  This section, as added by Laws 2000, chapter 399, 
*article 1, section 35, is effective July 1, 2001.  Laws 2000, 
*chapter 399, article 1, section 130. 

*   NOTE:  Minnesota Statutes 1998, section 336.9-315, which 
*reads as follows, is repealed July 1, 2001.  Laws 2000, chapter 
*399, article 1, section 130. 

*   "336.9-315 Priority when goods are commingled or 
*processed.  

*   (1) If a security interest in goods was perfected and 
*subsequently the goods or a part thereof have become part of a 
*product or mass, the security interest continues in the product 
*or mass if 

*   (a) the goods are so manufactured, processed, assembled or 
*commingled that their identity is lost in the product or mass; 
*or 

*   (b) a financing statement covering the original goods also 
*covers the product into which the goods have been manufactured, 
*processed, or assembled. 

*   In a case to which paragraph (b) applies, no separate 
*security interest in that part of the original goods which has 
*been manufactured, processed, or assembled into the product may 
*be claimed under section 336.9-314.  

*   (2) When under subsection (1) more than one security 
*interest attaches to the product or mass, they rank equally 
*according to the ratio that the cost of the goods to which each 
*interest originally attached bears to the cost of the total 
*product or mass."