2900

LAWS OF MARYLAND

Ch. 824

(b)  An unpaid transferee of the chattel paper
has a security interest in the goods against the transferor.
Such security interest is prior to a security interest
asserted under paragraph (a) to the extent that the
transferee of the chattel paper was entitled to priority
under § 9-308[.];

(c)  An unpaid transferee of the account has a
security interest in the goods against the transferor. Such
security INTEREST is subordinate to a security interest
asserted under paragraph (a)[.]; AND

(d)  A security interest of an unpaid transferee
asserted under paragraph (b) or (c) must be perfected for
protection against creditors of the transferor and
purchasers of the returned or repossessed goods.

9-307.

(1)  A buyer in ordinary course of business (subsection
(9) of § 1-201) other than a person buying farm products
from a person engaged in farming operations takes free of a
security interest created by his seller even though the
security interest is perfected and even though the buyer
knows of its existence.

(2)  In the case of consumer goods having an original
purchase price not in excess of $500 [and in the case of
farm equipment having an original purchase price not in
excess of $500 (other than fixtures, see § 9-313)], a buyer
takes free of a security interest even though perfected if
he buys without knowledge of the security interest, for
value and for his own personal, family or household purposes
[or his own farming operations] unless prior to the purchase
the secured party has filed a financing statement covering
such goods.

9-308.

[A purchaser of chattel paper or a nonnegotiable
instrument who gives new value and takes possession of it in
the ordinary course of his business and without knowledge
that the specific paper or instrument is subject to a
security interest has priority over a security interest
which is perfected under § 9-304 (permissive filing and
temporary perfection). A purchaser of chattel paper who
gives new value and takes possession of it in the ordinary
course of his business has priority over a security interest
in chattel paper which is claimed merely as proceeds of
inventory subject to a security interest (§ 9-306), even
though he knows that the specific paper is subject to the
security interest.]

A PURCHASER OF CHATTEL PAPER OR AN INSTRUMENT WHO GIVES
NEW VALUE AND TAKES POSSESSION OF IT IN THE ORDINARY COURSE
OF HIS BUSINESS HAS PRIORITY OVER A SECURITY INTEREST IN THE
CHATTEL PAPER OR INSTRUMENT