Question

M3D1

Carrie financed the purchase of a lawn mower from Riding Galore and signed a promissory note and security agreement covering the purchase. Riding Galore did not file a financing statement. Carrie, in need of money, had a garage sell. Mickey bought Carrie’s lawn mower. Mickey was unaware of the history, with respect to the security agreement, of the lawn mower.

Mickey also bought a big screen TV from Better Buy Store. The TV, while in inventory at Better Buy Store, was subject to a security interest in favor of City Bank. City Bank had perfected its security interest by filing. Mickey, by coincidence, knew of this security interest when he purchased the TV.

Neither Carrie nor Best Buy Store paid their secured creditors. Those secured creditors want to repossess the collateral that is now in the possession of Mickey. In a lawsuit between Riding Galore vs. Mickey, what is the likely outcome? In the lawsuit of City Bank vs. Mickey, what is the likely outcome?

Answer 1

Answer:-

Given that Carrie and Riding Galore, marked a promissory note and security agreement covering the purchase of a lawn mower, however they didn't record the financing statement.

In another case, Better Buy Store's TV has dependent upon a security enthusiasm for favor of City Bank that is idealized the security enthusiasm by recording. At the point when both the banks wanted to repossess the collateral, it is the ownership of Mickey.

In a lawsuit between Riding Galore and Mickey, Mickey will win the lawsuit as Riding Galore doesn't have any financing proof as he didn't fill the financing statement.

In the other case, in a lawsuit between City Bank and Mickey, City Bank will win the lawsuit as City Bank has the proof of the security premium because it had consummated the security enthusiasm by documenting.

Please please like the answer......