Hempstead Bank v. Andy's Car Rental System, Inc.

The major question presented upon this appeal, which is one of first impression, is whether an automobile wholesaler who purchases used automobiles from an automobile leasing or rental company qualifies as a “ buyer in ordinary course of business ”, as that term is defined by subdivision (9) of section 1-201 of the Uniform Commercial Code (hereinafter referred to as U. C. C.), and, therefore, purchases free of a third party’s validly perfected security interest in the automobiles, pursuant to section 9-307 of the U. C. C.

‘1 ‘ Buyer in ordinary course of business ’ means a person who in good…