Practice question
A bank itself holds a security interest in its customer’s deposit account. Another creditor merely registers a competing account interest earlier and argues the ordinary timing rule invariably defeats the deposit-taking bank. Which is correct under Section 18(a)?
- Every registered interest defeats every control-based interest
- The deposit-taking institution’s specified security interest has the statutory priority over competing interests perfected by any method
- Deposit accounts can never be collateral
- Registration automatically transfers the account to the other creditor
- No special deposit-account priority exists
Legal references
- RA 11057, Section 18(a): https://lawphil.net/statutes/repacts/ra2018/ra_11057_2018.html
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