John Bought a Television from Jake's Appliance Center for His

question 61

Multiple Choice

John bought a television from Jake's Appliance Center for his personal use.John could not pay cash for it,so he signed a note and gave Jake's a security interest in the television.Jake's did not file a financing statement.About six months later,John sold this television to a neighbor,Jane,who did not know about Jake's security interest in it.John stopped making payments on the note to Jake's,and now Jake's wants to repossess the television from Jane.Can Jake's repossess this television from Jane?

• A) yes, because the security interest survives the sale to Jane
• B) no, because Jane is a buyer in the ordinary course of business, who takes the television free of any security interest
• C) no, because Jane is a buyer of a second-hand consumer good, and she did not have actual or constructive notice of the security interest
• D) no, because Jake's did not perfect the security interest, so it is not valid against third parties like Jane
• E) no, because Jake's security interest did not attach, and thus is not valid against anyone, including Jane

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Definitions:

NATO

The North Atlantic Treaty Organization, a military alliance established in 1949 between North American and European countries to provide collective security against aggression.

Warsaw

The capital and largest city of Poland, known for its historical significance, cultural heritage, and as a symbol of Polish national identity.

Détente

A period of improved relations between the United States and the Soviet Union during the Cold War, beginning in the late 1960s.

Nuclear Arms Reduction

Efforts and agreements aimed at reducing the number and capacity of nuclear weapons globally to prevent nuclear proliferation and decrease the likelihood of nuclear warfare.