When there are multiple competing secured parties 9-322(a) outlines three basic rules:

  1. 9-322(a)(3) – If nobody is perfected, then the first to attach wins.
  2. 9-322(a)(2) – If one party is perfected and another is not, the perfected party wins.
  3. Finally, 9-322(a)(1) – “First to file or perfect” rule – If both parties are perfected, then the first party who filed an effective financing statement, or perfected, first, that party will win.

So, the analysis that we need to run is:

  1. Have the parties attached? When
  2. Have the parties perfected? When
  3. Is there a filing? If so, when?


Priority continues unless there is a gap in the filing or perfection. See 9-322(a)(1). In other words, a secured party can tack multiple perfection methods to ensure that there is no lapse in perfection. For instance, if a secured party perfects by possession, they can file a financing statement and release possession. The date of perfection for priority reasons goes back to the time when perfection occurred by possession.

It is important to note that this analysis needs to be conducted for each piece of collateral. For instance, different types of collateral have grace periods where perfection remains for a temporary period of time.

Non-Essential Information

If a searcher relies on incorrect non-essential information in an effective filing statement (was approved, but shouldn’t have been), then the financing statement will be subordinate to the reliant searcher. Same thing with a certificate of file. 9-338(1) and (2).


Proceeds are separate from the original collateral and thus a fresh analysis must apply for proceeds. The only difference is that the date in the first to file or perfect rule focuses on the original collateral.


The content contained in this article may contain inaccuracies and is not intended to reflect the opinions, views, beliefs, or practices of any academic professor or publication. Instead, this content is a reflection on the author’s understanding of the law and legal practices.

Will Laursen

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