Also known as: perfecting security interests in fixtures · perfected security interest in fixtures · fixture filing · UCC § 9-334
Written by attorneys · grounded in primary & secondary sources — see below
A filing of a financing statement in the real property records that covers goods that are or will become fixtures and satisfies the statutory content requirements. The filing perfects the security interest against the debtor and supplies the notice needed to obtain priority over conflicting real property encumbrances when the debtor has a recorded interest or possession and the additional statutory conditions are met.
Paula Pierce buys industrial knitting machines on credit from Prime Logistics and bolts them to the floor of her leased factory. Prime Logistics takes a purchase-money security interest and records a fixture filing in the county real property records within twenty days after installation. When Paula defaults, Prime Logistics prevails over the landlord's prior mortgage because the purchase-money status and timely fixture filing satisfy the priority conditions.
Preston Pratt finances server racks and cooling units through Peak Performance for his data-center lease. Peak Performance perfects by a fixture filing recorded in the real property records eighteen days after the units are bolted and plumbed into the building. When Preston defaults, Peak Performance obtains priority over the building owner's later mortgage because the filing occurred within the twenty-day period after the goods became fixtures.
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Patrick Phan installs custom lighting grids and rails in a leased soundstage and finances them through Progressive Healthcare. Progressive Healthcare records a fixture filing in the real property records before the landlord's mortgage is recorded. When Patrick defaults, Progressive Healthcare takes priority over the landlord's interest because the fixture filing preceded the mortgage of record.
Yes. Article 9 expressly permits a security interest to be created in goods that are or become fixtures and to continue after affixation, provided the goods are not ordinary building materials incorporated into an improvement.
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A security interest in fixtures is subordinate to a conflicting interest of an encumbrancer or owner unless the secured party satisfies one of the special priority rules, such as a timely purchase-money fixture filing or a fixture filing made before the encumbrancer's interest is of record.
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A standard central-office financing statement perfects the interest against the debtor but does not give priority over real property encumbrances. A fixture filing in the real property records is required to invoke the special priority rules against mortgages and owners.
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No. Even a purchase-money security interest must also be perfected by a fixture filing before the goods become fixtures or within twenty days thereafter to obtain priority over a prior encumbrance.
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