CODE OF VIRGINIA

PRIORITY OF SECURITY INTERESTS IN TRANSFERRED COLLATERAL (§ 8.9A-325)

a. Subordination of security interest in transferred collateral. Except as
otherwise provided in subsection (b), a security interest created by a debtor is
subordinate to a security interest in the same collateral created by another
person if:

   1. the debtor acquired the collateral subject to the security interest created
   by the other person;

   2. the security interest created by the other person was perfected when the
   debtor acquired the collateral; and

   3. there is no period thereafter when the security interest is unperfected.

b. Limitation of subsection (a) subordination. Subsection (a) subordinates a
security interest only if the security interest:

   1. otherwise would have priority solely under § 8.9A-322 (a) or §
   8.9A-324; or

   2. arose solely under § 8.2-711 (3) or § 8.2A-508 (5).

HISTORY: 2000, c. 1007.