South Dakota Codified Laws
Chapter 09 - Secured Transactions
Section 57A-9-323 - Dating of perfection from time of advance--Subordination of security interest to interest of lien creditor--Rights of buyer of goods--Lessee of goods.

57A-9-323. Dating of perfection from time of advance--Subordination of security interest to interest of lien creditor--Rights of buyer of goods--Lessee of goods.
(a) Except as otherwise provided in subsection (c), for purposes of determining the priority of a perfected security interest under §57A-9-322(a)(1), perfection of the security interest dates from the time an advance is made to the extent that the security interest secures an advance that:
(1)Is made while the security interest is perfected only:
(A)Under §57A-9-309 when it attaches; or
(B)Temporarily under §57A-9-312(e), (f), or (g); and
(2)Is not made pursuant to a commitment entered into before or while the security interest is perfected by a method other than under §57A-9-309 or 57A-9-312(e), (f), or (g).
(b) Except as otherwise provided in subsection (c), a security interest is subordinate to the rights of a person that becomes a lien creditor to the extent that the security interest secures an advance made more than forty-five days after the person becomes a lien creditor unless the advance is made:
(1)Without knowledge of the lien; or
(2)Pursuant to a commitment entered into without knowledge of the lien.
(c) Subsections (a) and (b) do not apply to a security interest held by a secured party that is a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor.
(d) Except as otherwise provided in subsection (e), a buyer of goods other than a buyer in ordinary course of business takes free of a security interest to the extent that it secures advances made after the earlier of:
(1)The time the secured party acquires knowledge of the buyer's purchase; or
(2)Forty-five days after the purchase.
(e) Subsection (d) does not apply if the advance is made pursuant to a commitment entered into without knowledge of the buyer's purchase and before the expiration of the forty-five-day period.
(f) Except as otherwise provided in subsection (g), a lessee of goods, other than a lessee in ordinary course of business, takes the leasehold interest free of a security interest to the extent that it secures advances made after the earlier of:
(1)The time the secured party acquires knowledge of the lease; or
(2)Forty-five days after the lease contract becomes enforceable.
(g) Subsection (f) does not apply if the advance is made pursuant to a commitment entered into without knowledge of the lease and before the expiration of the forty-five-day period.

Source: SL 2000, ch 231.

Structure South Dakota Codified Laws