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Cal. Com. Code § 9320

Perfection and Priority

Known as the Uniform Commercial Code

The act spans §§ 1101–12107 (623 sections).

Applied in 2 court decisions — leading case 151 Cal. App. 4th 901 - Quartz of Southern California, Inc. v. Mullen Bros. (2007)

Most recently applied in Coker Equipment Co., Inc. v. Citiwest Structures (California), Inc. (February 2010)

Added by Stats. 1999, Ch. 991, Sec. 35

(a) Except as otherwise provided in subdivision (e), a buyer in ordinary course of business takes free of a security interest created by the buyer’s seller, even if the security interest is perfected and the buyer knows of its existence.

(b) Except as otherwise provided in subdivision (e), a buyer of goods from a person who used or bought the goods for use primarily for personal, family, or household purposes takes free of a security interest, even if perfected, if all of the following conditions are satisfied:

(1) The buyer buys without knowledge of the security interest.

(2) The buyer buys for value.

(3) The buyer buys primarily for the buyer’s personal, family, or household purposes.

(4) The buyer buys before the filing of a financing statement covering the goods.

(c) To the extent that it affects the priority of a security interest over a buyer of goods under subdivision (b), the period of effectiveness of a filing made in the jurisdiction in which the seller is located is governed by subdivisions (a) and (b) of Section 9316.

(d) A buyer in ordinary course of business buying oil, gas, or other minerals at the wellhead or minehead or after extraction takes free of an interest arising out of an encumbrance.

(e) Subdivisions (a) and (b) do not affect a security interest in goods in the possession of the secured party under Section 9313.

Official source: California Legislative Information. Reproduced from public-domain California statutes; confirm against the official source for the current text. Not legal advice.