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New York University Law Review



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Uniform Commercial Code, U.C.C., first-to-file, U.C.C Artcle 9 § 9-312(5)


Before the Uniform Commercial Code, a second secured party could not perfect his interest over a prior unperfected interest if he had knowledge of that prior interest. The Code, in contrast, promulgates a basic "first-to-file" priority rule in section 9-312(5). In this sharp departure from prior law, the knowledge factor is omitted. Other sections of Article 9, however, allude to certain aspects of the pre-Code knowledge requirements. Mr. Felsenfeld analyses the difficulties and incongruities which may arise from this lack of explicitness with regard to knowledge of prior security interests. He concludes that the courts may and should reconcile such disparities in accordance with basic Code policy, and suggests logical and practical interpretations to fill the void.