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95 Priority of creditor who receives payment of debt

1. A creditor who receives payment of a debt owing by a debtor through a debtor-initiated payment has priority over a security interest in—
   1. The funds paid:
   2. The intangible that was the source of the payment:
   3. A negotiable instrument used to effect the payment.
2. Subsection (1) applies whether or not the creditor had knowledge of the security interest at the time of the payment.
3. In subsection (1), debtor-initiated payment means a payment made by the debtor through the use of—
   1. A negotiable instrument; or
   2. An electronic funds transfer; or
   3. A debit, a transfer order, an authorisation, or a similar written payment mechanism executed by the debtor when the payment was made.

Example

Person A has a perfected security interest in person B's (a car dealer's) inventory (cars).
Person B sells some of the cars and deposits the cash proceeds into a cheque account.
Person B draws a cheque and pays person C (an unsecured creditor).
Person C's interest in the cheque has priority over person A's security interest in the cheque.

97 Priority of purchaser of investment security

1. The interest of a purchaser of an investment security has priority over a perfected security interest in the investment security if the purchaser—
   1. Gave value for the investment security; and
   2. Acquired the investment security without knowledge of the security interest; and
   3. Took possession of the investment security.
2. For the purposes of subsection (1), the purchaser of an investment security who acquired it under a transaction entered into in the ordinary course of the transferor's business has knowledge only if the purchaser acquired the interest with knowledge that the transaction is a breach of the security agreement to which the security interest relates.

Example

Person A has registered a financing statement in respect of all of person B's shares.
Person C also takes a security interest in all of person B's shares, but does not know about person A's security interest.
Person C perfects its security interest by taking possession of person B's share certificates.
Person C's security interest in person B's shares has priority over person A's security interest in the same shares.