Gigantic Motor Company (GMC) buys equipment for use as inventory, borrowing S200

Question

Gigantic Motor Company (GMC) buys equipment for use as inventory, borrowing S200,000 from Central Park Bank for a security interest in the equipment. Ten days later, GMC borrows $100,000 from Wonderland Bank, also for a security interest in the equipment. GMC later defaults on the loans Suppose that Wonderland Bank perfects its security interest on the day GMC borrow the funds. Central Park Bank doesn't get around to perfecting its security interest until a month after GMC borrows the funds. When GMC defaults, the party with priority to the collateral on GMC's default would be Neither party, since GCM owes money to both of them based on actual security agreements Central Park Bank and Wonderland Bank, in proportion to the GMC's debt to each OWonderland Bank, because it perfected its security agreement first Central Park Bank, because it got its security agreement first

Explanation / Answer

1. Wonderland Bank, because it perfected its security agreement first

The loan was taken based on a security Interest and the according to the law iof there is a defaulter in that case the security interest will be used to reimbuirse the claim ammount and in this case as Wonderland Bank was able to perfect the agreement before the loan was defaulted hence they will have the priority.

2. He will probably succeed. Since peaboy mutual funds, Inc failed to provide notice of the termination of the agency relationship to Mr. Bullwinkle, it will be liable for Boris's conduct even though he was no longer is agent.

In this case the organization is liable because when an agent is terminated the clients should be conveyed the same information as well in order to avoid such issues where the terminated agent may take advantage of the situation.

3. All litigation and other actions by creditors against the debtor and/or his property are suspended.

Under the United States Bankruptcy code section 362 as soon as bankruptcy is declared automatiuc stay is injuncted that creates such prohibitions.

4. Timmy only, because he is the principal

Under the contract and agency law, in such cases the Principal is liable to pay and not the agent because the agent is just a representative and has no right.

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