§ 11-9-315. Secured Party’s Rights on Disposition of Collateral and in Proceeds

1. Disposition of collateral; continuation of security interest or agricultural lien; proceeds.    Except as otherwise provided in this article and in subsection (2) of Code Section 11-2-403:
   1. A security interest or agricultural lien continues in collateral notwithstanding sale, lease, license, exchange, or other disposition thereof unless the secured party authorized the disposition free of the security interest or agricultural lien; and
   2. A security interest attaches to any identifiable proceeds of collateral.
2. When commingled proceeds identifiable.    Proceeds that are commingled with other property are identifiable proceeds:
   1. If the proceeds are goods, to the extent provided by Code Section 11-9-336; and
   2. If the proceeds are not goods, to the extent that the secured party identifies the proceeds by a method of tracing, including application of equitable principles, that is permitted under law other than this article with respect to commingled property of the type involved.
3. Perfection of security interest in proceeds.    A security interest in proceeds is a perfected security interest if the security interest in the original collateral was perfected.
4. Continuation of perfection.    A perfected security interest in proceeds becomes unperfected on the twenty-first day after the security interest attaches to the proceeds unless:
   1. The following conditions are satisfied:
      1. A filed financing statement covers the original collateral;
      2. The proceeds are collateral in which a security interest may be perfected by filing in the office in which the financing statement has been filed; and
      3. The proceeds are not acquired with cash proceeds;
   2. The proceeds are identifiable cash proceeds; or
   3. The security interest in the proceeds is perfected other than under subsection (c) of this Code section when the security interest attaches to the proceeds or within 20 days thereafter.
5. When perfected security interest in proceeds becomes unperfected.    If a filed financing statement covers the original collateral, a security interest in proceeds which remains perfected under paragraph (1) of subsection (d) of this Code section becomes unperfected at the later of:
   1. When the effectiveness of the filed financing statement lapses under Code Section 11-9-515 or is terminated under Code Section 11-9-513; or
   2. The twenty-first day after the security interest attaches to the proceeds.

History. Code 1981, § 11-9-315 , enacted by Ga. L. 2001, p. 362, § 1.

Law reviews.

For article discussing the classification of a continuing security interest in changing collateral as an unenforceable preference under Section 60a of the Bankruptcy Act, see 1 Ga. L. Rev. 257 (1967).

For note discussing creditor’s remedy of direct collection of accounts and instruments owed to the defaulting debtor, see 3 Ga. L. Rev. 198 (1968).

For comment on Sherrock v. Commercial Credit Corp., 290 A.2d 648 (Del. S. Ct. 1972), see 10 Ga. St. B.J. 110 (1973).

For article, “The Revisions to Article IX of the Uniform Commercial Code,” see 15 Ga. St. B.J. 120 (1977).

For article, “The Good Faith Purchase Idea and the Uniform Commercial Code,” see 15 Ga. L. Rev. 605 (1981).

For article, “Preparing the Georgia Farmer (or Other Smaller Entrepreneur) for Bankruptcy,” see 22 Ga. State Bar J. 186 (1986).

For annual survey article on commercial law, see 50 Mercer L. Rev. 193 (1998).