COMMENTS TO OFFICIAL TEXT
Prior Uniform Statutory Provision: None.
Purposes:
1. To state when a secured party claiming an interest in goods installed in or affixed to other goods is entitled to priority over a party with a security interest in the whole.
2. This Section changes prior law in that the secured party claiming an interest in a part (e.g., a new motor in an old car) is entitled to priority and has a right to remove even though under other rules of law the part now belongs to the whole. The Section adopts the same policy as that stated in Section 9-313 for fixtures.
3. This Section does not apply to goods which, for example, are so commingled in a manufacturing process that their original identity is lost. That type of situation is covered in Section 9-315. Section 9-315 should also be consulted for the effect of a financing statement which claims both component parts and the resulting product.
Cross References:
Sections 9-204(1), 9-303 and 9-312(1) and Part 5.
Point 2: Section 9-313.
Point 3: Section 9-315.
Definitional Cross References:
"Collateral". Section 9-105.
"Creditor". Section 1-201.
"Debtor". Section 9-105.
"Goods". Section 9-105.
"Knowledge". Section 1-201.
"Person". Section 1-201.
"Purchaser". Section 1-201.
"Secured party". Section 9-105.
"Security interest". Section 1-201.
"Value". Section 1-201.
"Writing". Section 1-201.