Flashcards Studio
Practice bar questions and get clear AI feedback on every answer.
Question
Under RA 11057 Secs. 3 and 4 (Personal Property Security Act), consider the following scenario: Zenith Agro Corp. (debtor) secures a loan from Summit Bank. The Security Agreement covers 'all present and future personal property' of Zenith, expressly listing inventory (including harvested produce), processing equipment, accounts receivable, and a software license used in farm-management. Summit Bank files a financing statement. Zenith later sells harvested produce to FreshCart Distributors, a buyer with no knowledge of the security interest. Zenith also enters into a factoring arrangement with QuickFlow Factors to sell post-sale receivables arising from the FreshCart sale. (i) Which asset categories fall within the Act's definitional and scope? (ii) Whether the security interest extends to (A) the sold produce, (B) the cash proceeds from the sale, and (C) the post-sale receivables arising from the factoring arrangement.