PPSR – Curing Defects in PPSR Registrations

We aim to deliver Just, Redemptive Outcomes®

This was a webinar presentation presented by on 3 November 2016.

The slides for this presentation are as follows:

Overview

  • Common Defects in PPSR registrations
  • Why you should act immediately if you become aware of defective registration
  • Late / out of time registrations – what are the risks
  • Case study on curing defects in late registration and obtaining a fresh PMSI registered in time

Recap – PPSR Essentials

  • Secured Party
  • Grantor
  • Collateral
  • Security Interest
  • PPS Lease
  • Purchase Money Security Interest

Recap – PPSR Essentials

ppsr-illustration1

Defective PPSR Registrations

Section 164 – Ineffective registrations

  • Definition of “defect” in s 10 “in relation to a registration, includes an irregularity omission or error in the registration”
  • Seriously misleading defect in data of registration
  • Defects in s 165
  • Not necessary to prove anyone was actually misled

Defective PPSR Registrations

Section 165 – Particular Defects

  • Collateral described by serial number – no result if searched by reference to time & serial number only
  • Collateral not described by serial number – no result if searched by reference to time & by grantor’s details (s 153)
  • If a security interest is incorrectly registered as a PMSI

Defective PPSR Registrations

What is a seriously misleading defect in registration data?

  • No Definition in PPSA
  • Objective test
  • Approach in New Zealand & Canada

Defective PPSR Registrations
What is NOT a seriously misleading defect in registration data?

  • Future Revelation Ltd v Medica Radiology & Nuclear Medicine P/L
  • In re Wasabi Energy Limited (Administrators Appointed) ACN 000 090 997

Defective PPSR Registrations

Seriously misleading defects in registration data?

  • KJM Leasing Ltd v Grandstand Brothers Inc. “Grandstand Brothers Inc” v “Grandstrand Bros Inc”
  • Fairbanx Corporation v Royal Bank of Canada “Friction Technology Consultants Inc” v “ Friction Tecnology Constultants Inc”

Why should you act immediately?

What are the Risks?

  • Purchaser may take property free of security interest (s 43)
  • Loss of all security in cases of Insolvency

Case Study –Accolade Wines
Applications pursuant to S 588FM

  • Accolade Wines Australia Limited & Others [2016] NSWSC 1023
  • Inadvertently registered Grantor’s ABN instead of ACN