FAQs – Personal Property Securities
Search for frequently asked questions relating to the Personal Property Securities Act 2009. Click on the question below to view answer.
Only when the grantor is providing security over all of its personal property. This is similar to granting a fixed and floating charge which was previously registered with ASIC pursuant to the Corporations Act 2001 (Cwlth).
Depending on the client’s circumstances, it may not be appropriate where the client is purchasing a single piece of equipment such as a photocopier on finance for the client to give a charge over all of their all present and after acquired property. In this example the collateral class should be described as ‘other goods’ and not all present and after acquired property. You can find more information about collateral classes on the PPSR website.
What can be done where a security interest has not been registered within the required 15 days for a PMSI or 20 days for all other security interests?
A registration can still be made out of time. However super priority will be lost where a PMSI is registered out of time and a six month rule applies to all registrations made out of time so that priority will be lost where an insolvency event occurs within the period of six months from registration.
See section 588FM of the Corporations Act 2001 (Cwlth). There have been a number of cases which have considered this section. See In the matter of Barclays Bank plc  NSWSC 1095. In this case an extension of time was sought for registration of a security interest pursuant to section 588FM of the Corporations Act 2001 (Cwlth). See also In the matter of Cardinia Nominees Pty Ltd  NSWSC 32 (1 February 2013). In this case it was unclear from the wording of a charge dated 3 August 2012 which party was responsible for registering the charge on the PPSR. The charge was finally registered on 7 September 2012 but this was outside the 20 days allowed for registration. An order was made extending the date of registration pursuant to section 588FM Corporations Act 2001 (Cwlth) to 7 September 2012.
This means if the personal property is sold then the secured party can claim the proceeds from the sale.
Section 46 of the PPSA deals with taking free of any security interest where the personal property is acquired from a seller in the ordinary course of the seller’s business.
This section does not apply to ‘serial numbered goods where the buyer holds the goods as inventory.
‘Serial number’ is defined in section 10 as:
A serial number by which the regulations require or permit the collateral to be described by registration.
The PPS regulations 2010 provide that for consumer property serial numbered goods include aircraft, intangible property ie a design, patent etc, motor vehicles and watercraft. Refer to regulation 2.2.
A client wishes to grant a loan and the security for the loan will include some personal property. What clause do you suggest be included in the security agreement relating to the Personal Property Securities Act 2009 (Cwlth) (PPSA)?
Consider using the PPSA model clause for general security agreements developed by five international law firms which can be downloaded from: http://www.allens.com.au/pubs/pdf/ppsamodelclauses.pdf