§ 25-9-328. Priority of security interests in investment property. - North Carolina Statutes

§25‑9‑328.  Priority of security interests in investment property.

The following rules governpriority among conflicting security interests in the same investment property:

(1)        A security interestheld by a secured party having control of investment property under G.S. 25‑9‑106has priority over a security interest held by a secured party that does nothave control of the investment property.

(2)        Except as otherwiseprovided in subdivisions (3) and (4) of this section, conflicting securityinterests held by secured parties each of which has control under G.S. 25‑9‑106rank according to priority in time of:

a.         If the collateral isa security, obtaining control;

b.         If the collateral isa security entitlement carried in a securities account and:

1.         If the secured partyobtained control under G.S. 25‑8‑106(d)(1), the secured party'sbecoming the person for which the securities account is maintained;

2.         If the secured partyobtained control under G.S. 25‑8‑106(d)(2), the securitiesintermediary's agreement to comply with the secured party's entitlement orderswith respect to security entitlements carried or to be carried in thesecurities account; or

3.         If the secured partyobtained control through another person under G.S. 25‑8‑106(d)(3),the time on which priority would be based under this subdivision if the otherperson were the secured party; or

c.         If the collateral isa commodity contract carried with a commodity intermediary, the satisfaction ofthe requirement for control specified in G.S. 25‑9‑106(b)(2) withrespect to commodity contracts carried or to be carried with the commodityintermediary.

(3)        A security interestheld by a securities intermediary in a security entitlement or a securitiesaccount maintained with the securities intermediary has priority over aconflicting security interest held by another secured party.

(4)        A security interestheld by a commodity intermediary in a commodity contract or a commodity accountmaintained with the commodity intermediary has priority over a conflictingsecurity interest held by another secured party.

(5)        A security interestin a certificated security in registered form which is perfected by takingdelivery under G.S. 25‑9‑313(a) and not by control under G.S. 25‑9‑314has priority over a conflicting security interest perfected by a method otherthan control.

(6)        Conflicting securityinterests created by a broker, securities intermediary, or commodityintermediary which are perfected without control under G.S. 25‑9‑106rank equally.

(7)        In all other cases,priority among conflicting security interests in investment property isgoverned by G.S. 25‑9‑322 and G.S. 25‑9‑323. (1997‑181,s. 5; 2000‑169, s. 1.)