Priorities. PC Contractors, Inc, was an excavating business in Kansas City, Missouri. Union Bank ...

Priorities
The court held, among other things, that the equipment belonged to Dean, but Union appealed to a state intermediate appellate court, which reversed this judgment. The appellate court held that the payment of a purchase price does not control when a buyer acquires rights in collateral sufficient to support the attachment of a creditor's security interest. Instead, for a security interest to attach, a debtor must have some degree of control or authority over collateral placed in the debtor's possession. Thus, in this case, PC Contractors' failure to pay the purchase price is not determinative of whether it had rights in the collateral. Rather, the determining factor is whether PC Contractors had control over the Equipment. . . . Here, PC Contractors had possession of the Equipment and exercised control over it by using it in its business. For that reason, Union Bank's security interest attached to the Equipment. Article 9's maxim, first in time, first in right,' applies here. Union Bank's perfected security interest takes priority over Dean Machinery's unperfected interest in the Equipment.

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