47-9336. Commingled goods


A. In this section, "commingled goods" means goods that are physically united with
other goods in such a manner that their identity is lost in a product or mass.


B. A security interest does not exist in commingled goods as such. However, a
security interest may attach to a product or mass that results when goods become
commingled goods.


C. If collateral becomes commingled goods, a security interest attaches to the
product or mass.


D. If a security interest in collateral is perfected before the collateral becomes
commingled goods, the security interest that attaches to the product or mass under
subsection C is perfected.


E. Except as otherwise provided in subsection F, the other provisions of this
article determine the priority of a security interest that attaches to the product or
mass under subsection C.


F. If more than one security interest attaches to the product or mass under
subsection C, the following rules determine priority:


1. A security interest that is perfected under subsection D has priority over a
security interest that is unperfected at the time the collateral becomes commingled
goods.


2. If more than one security interest is perfected under subsection D, the security
interests rank equally in proportion to the value of the collateral at the time it became
commingled goods.