                                 CODE OF VIRGINIA

PRIORITIES AMONG CONFLICTING SECURITY INTERESTS IN AND AGRICULTURAL LIENS ON
SAME COLLATERAL (§ 8.9A-322)

a. General priority rules. Except as otherwise provided in this section,
priority among conflicting security interests and agricultural liens in the same
collateral is determined according to the following rules:

   1. Conflicting perfected security interests and agricultural liens rank
   according to priority in time of filing or perfection. Priority dates from the
   earlier of the time a filing covering the collateral is first made or the
   security interest or agricultural lien is first perfected, if there is no
   period thereafter when there is neither filing nor perfection.

   2. A perfected security interest or agricultural lien has priority over a
   conflicting unperfected security interest or agricultural lien.

   3. The first security interest or agricultural lien to attach or become
   effective has priority if conflicting security interests and agricultural
   liens are unperfected.

b. Time of perfection; proceeds and supporting obligations. For the purposes of
subsection (a) (1):

   1. the time of filing or perfection as to a security interest in collateral is
   also the time of filing or perfection as to a security interest in proceeds;
   and

   2. the time of filing or perfection as to a security interest in collateral
   supported by a supporting obligation is also the time of filing or perfection
   as to a security interest in the supporting obligation.

c. Special priority rules: proceeds and supporting obligations. Except as
otherwise provided in subsection (f), a security interest in collateral which
qualifies for priority over a conflicting security interest under §§ 8.9A-327,
8.9A-328, 8.9A-329, 8.9A-330 or § 8.9A-331 also has priority over a conflicting
security interest in:

   1. any supporting obligation for the collateral; and

   2. proceeds of the collateral if:

A. the security interest in proceeds is perfected;

B. the proceeds are cash proceeds or of the same type as the collateral; and

C. in the case of proceeds that are proceeds of proceeds, all intervening
proceeds are cash proceeds, proceeds of the same type as the collateral, or an
account relating to the collateral.

e. Applicability of subsection (d). Subsection (d) applies only if the proceeds
of the collateral are not cash proceeds, chattel paper, negotiable documents,
instruments, investment property, or letter-of-credit rights.

f. Limitations on subsections (a) through (e). Subsections (a) through (e) are
subject to:

   1. subsection (g) and the other provisions of this part;

   2. &#xA7; 8.4-210 with respect to a security interest of a collecting bank;

   3. &#xA7; 8.5A-118 with respect to a security interest of an issuer or
   nominated person; and

   4. &#xA7; 8.9A-110 with respect to a security interest arising under Title 8.2
   or Title 8.2A.

g. Priority under agricultural lien statute. A perfected agricultural lien on
collateral has priority over a conflicting security interest in or agricultural
lien on the same collateral if the statute creating the agricultural lien so
provides.

HISTORY: Code 1950, § 43-27; 1964, c. 219, § 8.9-312; 1966, c. 557; 1973, c.
509; 1983, c. 204; 1984, c. 613; 1996, c. 216; 2000, c. 1007.