Personal Property Securities Act 2009 (Cth) A new regime

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New Regime The 6 elements of the new regime: 1.Security Interest 2.Collateral 3.Attachment 4.Enforceability 5.Perfection 6.Enforcement

Security Interest A “Security Interest” is:  an interest  in relation to personal property  provided for by a transaction  that secures the payment or performance of an obligation

Deemed Security Interests  The interest of a transferee in an account or chattel paper  The interest of a consignor who delivers goods to a consignee under a consignment  The interests of a lessor or bailor of goods under a PPS lease

Lessons to be learned from New Zealand Graham v Portacom New Zealand Limited (2004) 10 TCLR 983

Lessons to be learned from New Zealand Waller v New Zealand Bloodstock Limited [2006] 2 NZLR 629

Collateral The personal property to which the “security interest” applies, for the purpose of securing the payment or performance of an obligation, is called the “collateral” Secured PartyGrantor $$ Collateral

Attachment A security interest attaches to collateral when:  the grantor has rights in the collateral, or the power to transfer rights in the collateral to the secured party; and  either: -the secured party gives some value for the security interest; or -the grantor does an act by which the security interest arises

Enforceability A security interest is enforceable against a third party in respect of collateral if: the security interest is attached to the collateral; and:  the secured party possesses the collateral;  the secured party has control of collateral; or  the parties have entered into a security agreement.

Priority Priority, the general position is:  a “perfected” security interest has priority over an unperfected security interest  Priority between perfected interests in determined on a first-in-time basis  priority between unperfected interests is determined on a first-in-time basis

Exception to Priority: PMSIs Purchase Money Security Interest – the Super Priority Include: - a security interest in collateral where securing all or part of the purchase price - an interest under a PPS Lease - an interest under a commercial consignment

The scary law part

PPSA & Real Estate Abandoned goods under leases - Security over Tenant’s fitout Landlord contributions Lease of fitted out premises Security Deposits

The Register ITSA estimated volumes of register activity per year  Registrations 1.1 million  Amendments 0.25 million  Cancellations 1 million  Searches 6 million

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