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

Question 61

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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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