Tennessee Code Annotated

Title 47: Commercial Instruments and Transactions

Chapter 9: Secured Transactions

Part 3: Perfection and Priority

TCA 47-9-317: Interests that take priority over or take free of security interest or agricultural lien.

(a)  Conflicting security interests and rights of lien creditors.  A security interest or agricultural lien is subordinate to the rights of:

     (1)  A person entitled to priority under § 47-9-322; and

     (2)  Except as otherwise provided in subsection (e), a person that becomes a lien creditor before the earlier of the time:

          (A)  The security interest or agricultural lien is perfected; or

          (B)  One (1) of the conditions specified in § 47-9-203(b)(3) is met and a financing statement covering the collateral is filed.

(b)  Buyers that receive delivery.  Except as otherwise provided in subsection (e), a buyer, other than a secured party, of tangible chattel paper, tangible documents, goods, instruments, or a security certificate takes free of a security interest or agricultural lien if the buyer gives value and receives delivery of the collateral without knowledge of the security interest or agricultural lien and before it is perfected.

(c)  Lessees that receive delivery.  Except as otherwise provided in subsection (e), a lessee of goods takes free of a security interest or agricultural lien if the lessee gives value and receives delivery of the collateral without knowledge of the security interest or agricultural lien and before it is perfected.

(d)  Licensees and buyers of certain collateral.  A licensee of a general intangible or a buyer, other than a secured party, of accounts, electronic chattel paper, electronic documents, general intangibles, or investment property other than a certificated security takes free of a security interest if the licensee or buyer gives value without knowledge of the security interest and before it is perfected.

(e)  Purchase-money security interest.  Except as otherwise provided in §§ 47-9-320 and 47-9-321, if a person files a financing statement with respect to a purchase-money security interest before or within thirty (30) days after the debtor receives delivery of the collateral, the security interest takes priority over the rights of a buyer, lessee, or lien creditor which arise between the time the security interest attaches and the time of filing.

History: [Acts 2000, ch. 846, § 1; 2008, ch. 686, § 1; 2008, ch. 814, §§ 35, 36.]