AB111,85,2222 (a) A person entitled to priority under s. 409.322; and
AB111,85,2423 (b) Except as otherwise provided in sub. (5), a person that becomes a lien
24creditor before the earlier of the time:
AB111,85,2525 1. The security interest or agricultural lien is perfected; or
AB111,86,2
12. One of the conditions specified in s. 409.203 (2) (c) is met and a financing
2statement covering the collateral is filed.
AB111,86,7 3(2) Buyers that receive delivery. Except as otherwise provided in sub. (5), a
4buyer, other than a secured party, of tangible chattel paper, documents, goods,
5instruments, or a security certificate takes free of a security interest or agricultural
6lien if the buyer gives value and receives delivery of the collateral without knowledge
7of the security interest or agricultural lien and before it is perfected.
AB111,86,11 8(3) Lessees that receive delivery. Except as otherwise provided in sub. (5),
9a lessee of goods takes free of a security interest or agricultural lien if the lessee gives
10value and receives delivery of the collateral without knowledge of the security
11interest or agricultural lien and before it is perfected.
AB111,86,16 12(4) Licensees and buyers of certain collateral. A licensee of a general
13intangible or a buyer, other than a secured party, of accounts, electronic chattel
14paper, general intangibles, or investment property other than a certificated security
15takes free of a security interest if the licensee or buyer gives value without knowledge
16of the security interest and before it is perfected.
AB111,86,22 17(5) Purchase-money security interest. Except as otherwise provided in ss.
18409.320 and 409.321, if a person files a financing statement with respect to a
19purchase-money security interest before or within 20 days after the debtor receives
20delivery of the collateral, the security interest takes priority over the rights of a
21buyer, lessee, or lien creditor which arise between the time the security interest
22attaches and the time of filing.
AB111,87,2 23409.318 No interest retained in right to payment that is sold; rights and
24title of seller of account or chattel paper with respect to creditors and
25purchasers
. (1) Seller retains no interest. A debtor that has sold an account,

1chattel paper, payment intangible, or promissory note does not retain a legal or
2equitable interest in the collateral sold.
AB111,87,7 3(2) Deemed rights of debtor if buyer's security interest unperfected. For
4purposes of determining the rights of creditors of, and purchasers for value of an
5account or chattel paper from, a debtor that has sold an account or chattel paper,
6while the buyer's security interest is unperfected, the debtor is deemed to have rights
7and title to the account or chattel paper identical to those the debtor sold.
AB111,87,13 8409.319 Rights and title of consignee with respect to creditors and
9purchasers
. (1) Consignee has consignor's rights. Except as otherwise provided
10in sub. (2), for purposes of determining the rights of creditors of, and purchasers for
11value of goods from, a consignee, while the goods are in the possession of the
12consignee, the consignee is deemed to have rights and title to the goods identical to
13those the consignor had or had power to transfer.
AB111,87,18 14(2) Applicability of other law. For purposes of determining the rights of a
15creditor of a consignee, law other than this chapter determines the rights and title
16of a consignee while goods are in the consignee's possession if, under this subchapter,
17a perfected security interest held by the consignor would have priority over the rights
18of the creditor.
AB111,87,23 19409.320 Buyer of goods. (1) Buyer in ordinary course of business. Except
20as otherwise provided in sub. (5), a buyer in ordinary course of business, other than
21a person buying farm products from a person engaged in farming operations, takes
22free of a security interest created by the buyer's seller, even if the security interest
23is perfected and the buyer knows of its existence.
AB111,88,2 24(2) Buyer of consumer goods. Except as otherwise provided in sub. (5), a buyer
25of goods from a person who used or bought the goods for use primarily for personal,

1family, or household purposes takes free of a security interest, even if perfected, if the
2buyer buys:
AB111,88,33 (a) Without knowledge of the security interest;
AB111,88,44 (b) For value;
AB111,88,55 (c) Primarily for the buyer's personal, family, or household purposes; and
AB111,88,66 (d) Before the filing of a financing statement covering the goods.
AB111,88,10 7(3) Effectiveness of filing for sub. (2). To the extent that it affects the priority
8of a security interest over a buyer of goods under sub. (2), the period of effectiveness
9of a filing made in the jurisdiction in which the seller is located is governed by s.
10409.316 (1) and (2).
AB111,88,13 11(4) Buyer in ordinary course of business at wellhead or minehead. A buyer
12in ordinary course of business buying oil, gas, or other minerals at the wellhead or
13minehead or after extraction takes free of an interest arising out of an encumbrance.
AB111,88,16 14(5) Possessory security interest not affected. Subsections (1) and (2) do not
15affect a security interest in goods in the possession of the secured party under s.
16409.313.
AB111,88,25 17409.321 Licensee of general intangible and lessee of goods in ordinary
18course of business
. (1) Licensee in ordinary course of business. In this section,
19"licensee in ordinary course of business" means a person that becomes a licensee of
20a general intangible in good faith, without knowledge that the license violates the
21rights of another person in the general intangible, and in the ordinary course from
22a person in the business of licensing general intangibles of that kind. A person
23becomes a licensee in the ordinary course if the license to the person comports with
24the usual or customary practices in the kind of business in which the licensor is
25engaged or with the licensor's own usual or customary practices.
AB111,89,4
1(2) Rights of licensee in ordinary course of business. A licensee in ordinary
2course of business takes its rights under a nonexclusive license free of a security
3interest in the general intangible created by the licensor, even if the security interest
4is perfected and the licensee knows of its existence.
AB111,89,8 5(3) Rights of lessee in ordinary course of business. A lessee in ordinary
6course of business takes its leasehold interest free of a security interest in the goods
7created by the lessor, even if the security interest is perfected and the lessee knows
8of its existence.
AB111,89,13 9409.322 Priorities among conflicting security interests in and
10agricultural liens on same collateral. (1)
General priority rules. Except as
11otherwise provided in this section, priority among conflicting security interests and
12agricultural liens in the same collateral is determined according to the following
13rules:
AB111,89,1814 (a) Conflicting perfected security interests and agricultural liens rank
15according to priority in time of filing or perfection. Priority dates from the earlier of
16the time a filing covering the collateral is first made or the security interest or
17agricultural lien is first perfected, if there is no period thereafter when there is
18neither filing nor perfection.
AB111,89,2019 (b) A perfected security interest or agricultural lien has priority over a
20conflicting unperfected security interest or agricultural lien.
AB111,89,2221 (c) The first security interest or agricultural lien to attach or become effective
22has priority if conflicting security interests and agricultural liens are unperfected.
AB111,89,24 23(2) Time of perfection: proceeds and supporting obligations. For the
24purposes of sub. (1) (a):
AB111,90,2
1(a) The time of filing or perfection as to a security interest in collateral is also
2the time of filing or perfection as to a security interest in proceeds; and
AB111,90,53 (b) The time of filing or perfection as to a security interest in collateral
4supported by a supporting obligation is also the time of filing or perfection as to a
5security interest in the supporting obligation.
AB111,90,9 6(3) Special priority rules: proceeds and supporting obligations. Except as
7otherwise provided in sub. (6), a security interest in collateral which qualifies for
8priority over a conflicting security interest under s. 409.327, 409.328, 409.329,
9409.330, or 409.331 also has priority over a conflicting security interest in:
AB111,90,1010 (a) Any supporting obligation for the collateral; and
AB111,90,1111 (b) Proceeds of the collateral if:
AB111,90,1212 1. The security interest in proceeds is perfected;
AB111,90,1313 2. The proceeds are cash proceeds or of the same type as the collateral; and
AB111,90,1614 3. In the case of proceeds that are proceeds of proceeds, all intervening proceeds
15are cash proceeds, proceeds of the same type as the collateral, or an account relating
16to the collateral.
AB111,90,22 17(4) First-to-file priority rule for certain collateral. Subject to sub. (5) and
18except as otherwise provided in sub. (6), if a security interest in chattel paper, deposit
19accounts, negotiable documents, instruments, investment property, or
20letter-of-credit rights is perfected by a method other than filing, conflicting
21perfected security interests in proceeds of the collateral rank according to priority in
22time of filing.
AB111,90,25 23(5) Applicability of sub. (4). Subsection (4) applies only if the proceeds of the
24collateral are not cash proceeds, chattel paper, negotiable documents, instruments,
25investment property, or letter-of-credit rights.
AB111,91,1
1(6) Limitations on subs. (1) to (5). Subsections (1) to (5) are subject to:
AB111,91,22 (a) Subsection (7) and the other provisions of this subchapter;
AB111,91,33 (b) Section 404.210 with respect to a security interest of a collecting bank;
AB111,91,54 (c) Section 405.118 with respect to a security interest of an issuer or nominated
5person; and
AB111,91,76 (d) Section 409.110 with respect to a security interest arising under ch. 402 or
7411.
AB111,91,10 8(7) Priority under agricultural lien statute. A perfected agricultural lien on
9collateral has priority over a conflicting security interest in or agricultural lien on
10the same collateral if the statute creating the agricultural lien so provides.
AB111,91,15 11409.323 Future advances. (1) When priority based on time of advance.
12Except as otherwise provided in sub. (3), for purposes of determining the priority of
13a perfected security interest under s. 409.322 (1) (a), perfection of the security
14interest dates from the time an advance is made to the extent that the security
15interest secures an advance that:
AB111,91,1616 (a) Is made while the security interest is perfected only:
AB111,91,1717 1. Under s. 409.309 when it attaches; or
AB111,91,1818 2. Temporarily under s. 409.312 (5), (6), or (7); and
AB111,91,2119 (b) Is not made pursuant to a commitment entered into before or while the
20security interest is perfected by a method other than under s. 409.309 or 409.312 (5),
21(6), or (7).
AB111,91,25 22(2) Lien creditor. Except as otherwise provided in sub. (3), a security interest
23is subordinate to the rights of a person that becomes a lien creditor to the extent that
24the security interest secures an advance made more than 45 days after the person
25becomes a lien creditor unless the advance is made:
AB111,92,1
1(a) Without knowledge of the lien; or
AB111,92,22 (b) Pursuant to a commitment entered into without knowledge of the lien.
AB111,92,5 3(3) Buyer of receivables. Subsections (1) and (2) do not apply to a security
4interest held by a secured party that is a buyer of accounts, chattel paper, payment
5intangibles, or promissory notes or a consignor.
AB111,92,8 6(4) Buyer of goods. Except as otherwise provided in sub. (5), a buyer of goods
7other than a buyer in ordinary course of business takes free of a security interest to
8the extent that it secures advances made after the earlier of:
AB111,92,99 (a) The time the secured party acquires knowledge of the buyer's purchase; or
AB111,92,1010 (b) Forty-five days after the purchase.
AB111,92,14 11(5) Advances made pursuant to commitment: priority of buyer of goods.
12Subsection (4) does not apply if the advance is made pursuant to a commitment
13entered into without knowledge of the buyer's purchase and before the expiration of
14the 45-day period.
AB111,92,17 15(6) Lessee of goods. Except as otherwise provided in sub. (7), a lessee of goods,
16other than a lessee in ordinary course of business, takes the leasehold interest free
17of a security interest to the extent that it secures advances made after the earlier of:
AB111,92,1818 (a) The time the secured party acquires knowledge of the lease; or
AB111,92,1919 (b) Forty-five days after the lease contract becomes enforceable.
AB111,92,23 20(7) Advances made pursuant to commitment: priority of lessee of goods.
21Subsection (6) does not apply if the advance is made pursuant to a commitment
22entered into without knowledge of the lease and before the expiration of the 45-day
23period.
AB111,93,5 24409.324 Priority of purchase-money security interests. (1) General
25rule: purchase-money priority.
Except as otherwise provided in sub. (7), a perfected

1purchase-money security interest in goods other than inventory or livestock has
2priority over a conflicting security interest in the same goods, and, except as
3otherwise provided in s. 409.327, a perfected security interest in its identifiable
4proceeds also has priority, if the purchase-money security interest is perfected when
5the debtor receives possession of the collateral or within 20 days thereafter.
AB111,93,14 6(2) Inventory purchase-money priority. Subject to sub. (3) and except as
7otherwise provided in sub. (7), a perfected purchase-money security interest in
8inventory has priority over a conflicting security interest in the same inventory, has
9priority over a conflicting security interest in chattel paper or an instrument
10constituting proceeds of the inventory and in proceeds of the chattel paper, if so
11provided in s. 409.330, and, except as otherwise provided in s. 409.327, also has
12priority in identifiable cash proceeds of the inventory to the extent that the
13identifiable cash proceeds are received on or before the delivery of the inventory to
14a buyer, if:
AB111,93,1615 (a) The purchase-money security interest is perfected when the debtor receives
16possession of the inventory;
AB111,93,1817 (b) The purchase-money secured party sends an authenticated notification to
18the holder of the conflicting security interest;
AB111,93,2019 (c) The holder of the conflicting security interest receives the notification
20within 5 years before the debtor receives possession of the inventory; and
AB111,93,2321 (d) The notification states that the person sending the notification has or
22expects to acquire a purchase-money security interest in inventory of the debtor and
23describes the inventory.
AB111,94,3
1(3) Holders of conflicting inventory security interests to be notified.
2Subsection (2) (b) to (d) applies only if the holder of the conflicting security interest
3had filed a financing statement covering the same types of inventory:
AB111,94,54 (a) If the purchase-money security interest is perfected by filing, before the
5date of the filing; or
AB111,94,86 (b) If the purchase-money security interest is temporarily perfected without
7filing or possession under s. 409.312 (6), before the beginning of the 20-day period
8thereunder.
AB111,94,14 9(4) Livestock purchase-money priority. Subject to sub. (5) and except as
10otherwise provided in sub. (7), a perfected purchase-money security interest in
11livestock that are farm products has priority over a conflicting security interest in
12the same livestock, and, except as otherwise provided in s. 409.327, a perfected
13security interest in their identifiable proceeds and identifiable products in their
14unmanufactured states also has priority, if:
AB111,94,1615 (a) The purchase-money security interest is perfected when the debtor receives
16possession of the livestock;
AB111,94,1817 (b) The purchase-money secured party sends an authenticated notification to
18the holder of the conflicting security interest;
AB111,94,2019 (c) The holder of the conflicting security interest receives the notification
20within 6 months before the debtor receives possession of the livestock; and
AB111,94,2321 (d) The notification states that the person sending the notification has or
22expects to acquire a purchase-money security interest in livestock of the debtor and
23describes the livestock.
AB111,95,3
1(5) Holders of conflicting livestock security interests to be notified.
2Subsection (4) (b) to (d) applies only if the holder of the conflicting security interest
3had filed a financing statement covering the same types of livestock:
AB111,95,54 (a) If the purchase-money security interest is perfected by filing, before the
5date of the filing; or
AB111,95,86 (b) If the purchase-money security interest is temporarily perfected without
7filing or possession under s. 409.312 (6), before the beginning of the 20-day period
8thereunder.
AB111,95,15 9(6) Software purchase-money priority. Except as otherwise provided in sub.
10(7), a perfected purchase-money security interest in software has priority over a
11conflicting security interest in the same collateral, and, except as otherwise provided
12in s. 409.327, a perfected security interest in its identifiable proceeds also has
13priority, to the extent that the purchase-money security interest in the goods in
14which the software was acquired for use has priority in the goods and proceeds of the
15goods under this section.
AB111,95,17 16(7) Conflicting purchase-money security interests. If more than one security
17interest qualifies for priority in the same collateral under sub. (1), (2), (4), or (6):
AB111,95,2018 (a) A security interest securing an obligation incurred as all or part of the price
19of the collateral has priority over a security interest securing an obligation incurred
20for value given to enable the debtor to acquire rights in or the use of collateral; and
AB111,95,2121 (b) In all other cases, s. 409.322 (1) applies to the qualifying security interests.
AB111,95,25 22409.325 Priority of security interests in transferred collateral. (1)
23Subordination of security interest in transferred collateral. Except as
24otherwise provided in sub. (2), a security interest created by a debtor is subordinate
25to a security interest in the same collateral created by another person if:
AB111,96,2
1(a) The debtor acquired the collateral subject to the security interest created
2by the other person;
AB111,96,43 (b) The security interest created by the other person was perfected when the
4debtor acquired the collateral; and
AB111,96,55 (c) There is no period thereafter when the security interest is unperfected.
AB111,96,7 6(2) Limitation of sub. (1) subordination. Subsection (1) subordinates a security
7interest only if the security interest:
AB111,96,88 (a) Otherwise would have priority solely under s. 409.322 (1) or 409.324; or
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