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355.9-328 Priority of security interests in investment property.
The following rules govern priority among conflicting security interests in the same
investment property:
(1) A security interest held by a secured party having control of investment property
under KRS 355.9-106 has priority over a security interest held by a secured party
that does not have control of the investment property.
(2) Except as otherwise provided in subsections (3) and (4) of this section, conflicting
security interests held by secured parties each of which has control under KRS
355.9-106 rank according to priority in time of:
(a) If the collateral is a security, obtaining control;
(b) If the collateral is a security entitlement carried in a securities account and:
1.
If the secured party obtained control under KRS 355.8-106(4)(a), the
secured party's becoming the person for which the securities account is
maintained;
2.
If the secured party obtained control under KRS 355.8-106(4)(b), the
securities intermediary's agreement to comply with the secured party's
entitlement orders with respect to security entitlements carried or to be
carried in the securities account; or
3.
If the secured party obtained control through another person under KRS
355.8-106(4)(c), the time on which priority would be based under this
paragraph if the other person were the secured party; or
(c) If the collateral is a commodity contract carried with a commodity
intermediary, the satisfaction of the requirement for control specified in KRS
355.9-106(2)(b) with respect to commodity contracts carried or to be carried
with the commodity intermediary.
(3) A security interest held by a securities intermediary in a security entitlement or a
securities account maintained with the securities intermediary has priority over a
conflicting security interest held by another secured party.
(4) A security interest held by a commodity intermediary in a commodity contract or a
commodity account maintained with the commodity intermediary has priority over a
conflicting security interest held by another secured party.
(5) A security interest in a certificated security in registered form which is perfected by
taking delivery under KRS 355.9-313(1) and not by control under KRS 355.9-314
has priority over a conflicting security interest perfected by a method other than
control.
(6) Conflicting security interests created by a broker, securities intermediary, or
commodity intermediary which are perfected without control under KRS 355.9-106
rank equally.
(7) In all other cases, priority among conflicting security interests in investment
property is governed by KRS 355.9-322 and 355.9-323.
Effective: July 1, 2001
History: Repealed and reenacted 2001 Ky. Acts ch. 119, sec. 10, effective July 1, 2001.
-- Created 2000 Ky. Acts ch. 408, sec. 68, effective July 1, 2001.
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