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The Purchase Money Priority
Gilmore, Grant
Gilmore, Grant
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Abstract
For many years it has been recognized that a present security interest may be established in property to be acquired by the debtor in the future. When the subsequent acquisition is in turn financed by a purchase money transaction the question arises whether the lien of the original mortgagee or that of the purchase money creditor has priority. Professor Gilmore traces the historical priority given the purchase money interest, the areas in which the priority has been qualified, and the embodiment of the priority in the Uniform Conditional Sales Act. He then describes some of the solutions and raises some of the problems presented by Article 9 of the Uniform Commercial Code, discussing the Code's treatment of the purchase money interest in inventory, collateral other than inventory, and fixtures. He concludes by urging that defects in the Code be repaired in a uniform and careful manner rather than ignored or denied through fear that such repair would hinder general adoption of the Code.