Michigan Laws 554.1065 – Perfection of security interests; priority rules in article 9
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Terms Used In Michigan Laws 554.1065
- Assignee: means a person entitled to enforce an assignment of rents. See Michigan Laws 554.1052
- Cash proceeds: means proceeds that are money, checks, deposit accounts, or the like. See Michigan Laws 554.1052
- Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government, or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. See Michigan Laws 554.1052
- Proceeds: means personal property that is received or collected on account of a tenant's obligation to pay rents. See Michigan Laws 554.1052
- Rents: means any of the following:
(i) Sums payable for the right to possess or occupy, or for the actual possession or occupation of, real property of another person. See Michigan Laws 554.1052Security interest: means an interest in property that arises by agreement and secures performance of an obligation. See Michigan Laws 554.1052 State: means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. See Michigan Laws 554.1052 Uniform Commercial Code: A set of statutes enacted by the various states to provide consistency among the states' commercial laws. It includes negotiable instruments, sales, stock transfers, trust and warehouse receipts, and bills of lading. Source: OCC
(1) As used in this section:
(a) “Article 9” means article 9 of the uniform commercial code, 1962 PA 174, MCL 440.9101 to 440.9809, or, to the extent applicable to any particular issue, article 9 of the uniform commercial code as adopted by the state whose laws govern that issue under the choice-of-laws rules contained in article 9 as adopted by this state.
(b) “Conflicting interest” means an interest in proceeds, held by a person other than an assignee, that is either of the following:
(i) A security interest arising under article 9.
(ii) Any other interest if article 9 resolves the priority conflict between that person and a secured party with a conflicting security interest in the proceeds.
(2) An assignee’s security interest in identifiable cash proceeds is perfected if its security interest in rents is perfected. An assignee’s security interest in identifiable noncash proceeds is perfected only if the assignee perfects that interest in accordance with article 9.
(3) Except as otherwise provided in subsection (4), priority between an assignee’s security interest in identifiable proceeds and a conflicting interest is governed by the priority rules in article 9.
(4) An assignee’s perfected security interest in identifiable cash proceeds is subordinate to a conflicting interest that is perfected by control under article 9 but has priority over a conflicting interest that is perfected other than by control.