Alvin Smith bought a car from XYZ Autos Inc.,a car dealership,for the price of $15 000.Alvin paid $5000 cash and entered into a conditional sales contract to finance the remaining $10 000.Alvin had obtained the $5000 from his bank and executed a chattel mortgage for $9000 in favour of his bank.This represented $5000 for the deposit and $4000 in existing indebtedness.After Alvin obtained the car,he provided the bank with a description and its serial number.The bank completed the chattel mortgage with this information and registered a financing statement under the prevailing personal property security legislation.XYZ Autos Inc.similarly registered a financing statement,but did this three days later than the bank.Alvin subsequently defaulted under both securities.Which of the creditors has priority to the car,and why?

Question

Quizplus · Accepted Answer

The Answer of Alvin Smith bought a car from XYZ Autos Inc.,a car dealership,for the price of $15 000.Alvin paid $5000 cash and entered into a conditional sales contract to finance the remaining $10 000.Alvin had obtained the $5000 from his bank and executed a chattel mortgage for $9000 in favour of his bank.This represented $5000 for the deposit and $4000 in existing indebtedness.After Alvin obtained the car,he provided the bank with a description and its serial number.The bank completed the chattel mortgage with this information and registered a financing statement under the prevailing personal property security legislation.XYZ Autos Inc.similarly registered a financing statement,but did this three days later than the bank.Alvin subsequently defaulted under both securities.Which of the creditors has priority to the car,and why?

Alvin Smith Bought a Car from XYZ Autos Inc