Subject-Matter Index

Priority

bona fide purchaser for value without notice

holder of security interest who purchases legal interest in collateral has priority over competing equitable interest—if purchaser already has equitable interest without notice of competing equitable interest, entitled to perfect his equitable interest and acquire priority—acquiring actual notice or competing interest before obtaining legal interest then irrelevant: Hammerschmidt v. Barclays Bank PLC (Royal Ct.), 2005–06 GLR 104

competing equitable interests

normally, first in time prevails—interest under constructive trust in bank account used as collateral for security interest takes priority over equitable assignment of collateral, unless holder of security interest becomes bona fide purchaser for value of legal interest without notice of equitable interest, or other exceptional circumstances apply, e.g. rule in Dearle v. Hall: Hammerschmidt v. Barclays Bank PLC (Royal Ct.), 2005–06 GLR 104

rule in Dearle v. Hall makes priority depend on date notice given to holder of legal interest of creation of equitable interest—of limited application (not to be extended) to circumstances in which successive assignments of equitable interests in same property to different assignees—cannot therefore apply to resolve priority where competing priorities in same interest and only one assignee: Hammerschmidt v. Barclays Bank PLC (Royal Ct.), 2005–06 GLR 104

person with interest in collateral

Security Interests (Guernsey) Law 1993, s.14(1)(d) gives no additional protection to person with interest in collateral if not debtor or holder of security interest, e.g. beneficiary under constructive trust over collateral—priority then to be decided “without regard to the Law”—s.4 only concerns “priority between security interests”: Hammerschmidt v. Barclays Bank PLC (Royal Ct.), 2005–06 GLR 104