2894

LAWS OF MARYLAND

Ch. 824

9-205.

A security interest is not invalid or fraudulent
against creditors by reason of liberty in the debtor to use,
commingle or dispose of all or part of the collateral
(including returned or repossessed goods) or to collect or
compromise accounts[, contract rights] or chattel paper, or
to accept the return of goods or make repossessions, or to
use, commingle or dispose of proceeds, or by reason of the
failure of the secured party to require the debtor to
account for proceeds or replace collateral. This section
does not relax the requirements of possession where
perfection of a security interest depends upon possession of
the collateral by the secured party or by a bailee.

9-301.

(1)  Except as otherwise provided in subsection (2) an
unperfected security interest is subordinate to the rights
of

(a)  Persons entitled to priority under § 9-312;

(b)  A person who becomes a lien creditor
[without knowledge of the security interest and] before [it]
THE SECURITY INTEREST is perfected;

(c)  In the case of goods, instruments,
documents, and chattel paper, a person who is not a secured
party and who is a transferee in bulk or other buyer not in
ordinary course of business, OR IS A BUYER OF FARM PRODUCTS
IN ORDINARY COURSE OF BUSINESS, to the extent that he gives
value and receives delivery of the collateral without
knowledge of the security interest and before it is
perfected;

(d)  In the case of accounts[, contract rights,]
and general intangibles, a person who is not a secured party
and who is a transferee to the extent that he gives value
without knowledge of the security interest and before it is
perfected.

(2)  If the secured party files with respect to a
purchase-money security interest before or within ten days
after the DEBTOR RECEIVES POSSESSION OF THE collateral
[comes into possession of the debtor], he takes priority
over the rights of a transferee in bulk or of a lien
creditor which arise between the time the security interest
attaches and the time of filing.

(2A) If the secured party files with respect to a
non-purchase-money security interest before or within ten
days after the security interest attaches, he takes priority
over the rights of a transferee in bulk or of a lien
creditor which arise between the time the security interest
attaches and the time of filing.