VA Bar Creditors Rights 2

Question 1

Under UCC Article 9, a security interest in equipment is perfected when the secured party files a financing statement in the correct office AND:

Accepted Answer

The secured party has given value and the debtor has rights in the collateral

Answer

Perfection requires attachment (value given, debtor has rights, security agreement) plus the perfection step such as filing.

Question 2

A purchase-money security interest (PMSI) in goods other than inventory or livestock has priority over a conflicting security interest if perfected:

Accepted Answer

Within 20 days after the debtor receives possession of the collateral

Answer

UCC § 9-324(a) gives a PMSI in non-inventory goods superpriority if perfected within 20 days after delivery.

Question 3

Under UCC Article 9, which method of perfection is generally NOT available for a security interest in a negotiable instrument?

Accepted Answer

Automatic perfection upon attachment

Answer

Negotiable instruments are perfected by filing or possession; automatic perfection does not apply to them.

Question 4

Debtor grants Bank A a security interest in all inventory on January 1 (unperfected). On February 1, Debtor grants Bank B a security interest in the same inventory and Bank B immediately files. Bank A files on March 1. Who has priority?

Accepted Answer

Bank B, because it filed first

Answer

Under the first-to-file-or-perfect rule of UCC § 9-322, Bank B wins by filing first.

Question 5

Under Virginia law, a judgment lien on real property is created when:

Accepted Answer

An abstract of judgment is recorded in the circuit court clerk's office where the land is located

Answer

In Virginia, a judgment lien on real estate attaches when the judgment is docketed in the circuit court where the property is located.

(VA Bar) Virginia Bar Exam Practice Test

(VA Bar) Virginia Bar Exam Practice Test

VA Bar Creditors Rights 2