                                 CODE OF VIRGINIA

RIGHTS OF SECURED PARTY (§ 29.1-733.24)

A. Subject to subsection B or C, the effect of perfection and nonperfection of a
security interest and the priority of a perfected or unperfected security
interest with respect to the rights of a purchaser or creditor, including a lien
creditor, is governed by Titles 8.1A through 8.10.

B. A security interest perfected under this article has priority over any
statutory lien on the watercraft, except for a mechanics lien for repairs to the
extent of $150 given by &#xA7; 43-33 if the requirements are met, provided the
mechanic furnishes the holder of any such recorded lien who requests it with an
itemized sworn statement of the work done and materials supplied for which the
lien is claimed.

C. If, while a security interest in a watercraft is perfected by any method
under this article, the Department creates a certificate of title that does not
indicate that the watercraft is subject to the security interest or contain a
statement that it may be subject to security interests not indicated on the
certificate:

   1. A buyer of the watercraft, other than a person in the business of selling
   or leasing watercraft of that kind, takes free of the security interest if the
   buyer, acting in good faith and without knowledge of the security interest,
   gives value and receives possession of the watercraft; and

   2. The security interest is subordinate to a conflicting security interest in
   the watercraft that is perfected under &#xA7; 29.1-733.15 after creation of
   the certificate and without the conflicting secured party&#8217;s knowledge of
   the security interest.

HISTORY: 2013, c. 787.