A "buyer in the ordinary course of business" who purchases goods from a merchant takes those goods free of any perfected or unperfected security interest in that merchant's inventory.

Question

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This is known as the "buyer in the ordinary course of business" exception under the Uniform Commercial Code. It allows a buyer who purchases goods in the normal course of the seller's business, and who does not have knowledge of any security interest in those goods, to take free and clear of any security interest in the seller's inventory.

A "Buyer in the Ordinary Course of Business" Who Purchases