Charles owns an office equipment store. Recently, he bought $100,000 of new inventory items for his business from Office Suppliers, Inc. (OSI). Charles paid for the entire new inventory purchase from OSI by taking a loan from Easy Business Credit (EBC). Charles signed a promissory note giving EBC a security interest in the office equipment inventory. EBC did not officially file papers to perfect the security interest.
Later, Charles needed cash for working capital for a new business venture, so he borrowed money from Central Bank, giving Central Bank (CB) a security interest in his office supply inventory. CB filed and perfected this security interest immediately.
Charles now cannot pay any of his debts, so both EBC and CB attempt to foreclose on Charles' office inventory.
Analyze and describe who, between EBC and CB, has priority and why?
Discuss your rationale, justification specifically and in detail.