Auto Mart sells new and used vehicles and finances its inventory through ABC Bank.Finn purchases a new car from Auto Mart and receives good title free and clear of ABC's security interest.Which of the following is false?
A)Finn receives this protection to promote confidence in commercial transactions.
B)ABC is more interested in the proceeds from the sale rather than the inventory.
C)Finn is liable to ABC because ABC has superior title.
D)Finn is a buyer in the ordinary course of business.

Question

Quizplus · Accepted Answer

Finn gets good title to the car free and clear of the ABC's security interest if he is a buyer in the ordinary course of business and without knowledge that the sale is in violation of a security interest.The basic purpose of this exception is to protect those who innocently buy from merchants and thereby to promote confidence in such commercial transactions.The exception also reflects the fact that ABC is more interested in the proceeds from the sale than in the inventory.

Auto Mart Sells New and Used Vehicles and Finances Its