§ 25-9-338. Priority of security interest or agricultural lien perfected by filed financing statement providing certain incorrect information. - North Carolina Statutes

§ 25‑9‑338. Priority of security interest or agricultural lien perfected by filed financingstatement providing certain incorrect information.

If a security interest oragricultural lien is perfected by a filed financing statement providinginformation described in G.S. 25‑9‑516(b)(5) which is incorrect atthe time the financing statement is filed:

(1)        The securityinterest or agricultural lien is subordinate to a conflicting perfectedsecurity interest in the collateral to the extent that the holder of theconflicting security interest gives value in reasonable reliance upon theincorrect information; and

(2)        A purchaser, otherthan a secured party, of the collateral takes free of the security interest oragricultural lien to the extent that, in reasonable reliance upon the incorrectinformation, the purchaser gives value and, in the case of tangible chattelpaper, tangible documents, goods, instruments, or a security certificate,receives delivery of the collateral. (2000‑169, s. 1; 2006‑112, s. 54.)