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complaint, asking the court to declare that its purchase money security
interest in the tractor had priority over Bank’s security interest. Does it?
In the Matter of Prior Brothers, Inc., 29 Wn.App. 905, 632 P.2d 522,
Web 1981 Wash.App. Lexis 2507 (Court of Appeals of Washington)
27.7 Buyer in the Ordinary Course of Business Heritage Ford Lincoln
Mercury, Inc. (Heritage) was in the business of selling new cars.
Heritage entered into an agreement with Ford Motor Credit Company
(Ford), whereby Ford extended a continuing line of credit to Heritage to
purchase vehicles. Heritage granted Ford a purchase money security
interest in all motor vehicles it owned and thereafter acquired and in all
proceeds from the sale of such motor vehicles. Ford immediately filed
its financing statement with the secretary of state. When the dealership
experienced financial trouble, two Heritage officers decided to double
finance certain new cars by issuing dealer papers to themselves and
obtaining financing for two new cars from First National Bank & Trust
Company of El Dorado (Bank). The loan proceeds were deposited in the
dealership’s account to help with its financial difficulties. The cars were
available for sale. When the dealership closed its doors and turned over
the car inventory to Ford, Bank alleged that it had priority over Ford
because the Heritage officers were buyers in the ordinary course of
business. Who wins? First National Bank and Trust Company of El
Dorado v. Ford Motor Credit Company, 231 Kan. 431, 646 P.2d 1057,
Web 1982 Kan. Lexis 280 (Supreme Court of Kansas)
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ACC 543 Week 5 Individual Textbook Exercise (47.2, 47.3,
47.6, 50.1, 50.6, 50.7, 45.2, 45.5, 45.6, 45.7)
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