409.3245 Priority of production-money security interests and agricultural liens.

(1) Except as otherwise provided in subs. (3), (4), and (5), if the requirements of sub. (2) are satisfied, a perfected production-money security interest in production-money crops has priority over a conflicting security interest in the same crops to the extent of the production-money obligation secured by the production-money security interest and, except as otherwise provided in s. 409.327, also has priority in their identifiable proceeds.

(2) A production-money security interest has priority under sub. (1) if:

(a) The production-money security interest is perfected by filing when the production-money secured party first gives new value to enable the debtor to produce the crops;

(b) The production-money secured party sends an authenticated notification by certified mail to the holder of the conflicting security interest not less than 20 or more than 30 days before the production-money secured party first gives new value to enable the debtor to produce the crops if the holder had filed a financing statement covering the crops before the date of the filing made by the production-money secured party; and

(c) The notification states that the production-money secured party has or expects to acquire a production-money security interest in the debtor's crops and provides a description of the crops, the name and mailing address of the production-money secured party giving the notice, the name and mailing address of the debtor, the name and mailing address of the lender to whom notice is being sent, the date on which the transaction would take place, and the maximum amount of new value to be provided.

(3) Except as otherwise provided in sub. (4) or (5), if more than one security interest qualifies for priority in the same collateral under sub. (1), the security interests rank according to priority in time of filing under s. 409.322 (1).

(4) To the extent that a person holding a perfected security interest in production-money crops that are the subject of a production-money security interest gives new value to enable the debtor to produce the production-money crops and the value is in fact used for the production of the production-money crops, the security interests rank according to priority in time of filing under s. 409.322 (1).

(5) To the extent that a person holds both an agricultural lien and a production-money security interest in the same collateral securing the same obligations, the rules of priority applicable to agricultural liens govern priority.

History: 2001 a. 10.