Kathy Has a Horse Farm Where She Raises Thoroughbred Horses

Essay

Kathy has a horse farm where she raises thoroughbred horses to race.She had negotiated a loan of $25 000 from Commerce Bank to buy a new truck for the business.The bank took a security interest in all her present and future assets in a general security agreement.The bank registered its security interest in February 2010.A few months later, Kathy negotiated a loan in the amount of $200 000 from Canada Trust for the purpose of buying horses and equipment.Canada Trust took a security interest in all of Kathy's present and future assets under a general security agreement.Kathy spent the money to buy the horses, and they were delivered on June 15, 2010.Canada Trust registered its security interest by filing a financing statement on July 15, 2010.Kathy defaults on her obligations to Canada Trust and the bank.Both the bank and Canada Trust claim that its security interest has first priority.Who is entitled to Kathy's assets?