Personal Property Securities Act What have we learnt so far? T1300 RLS LEGAL Wresultslegal.com.au Presented by Karl Hill | Managing Director BRISBANE | SYDNEY | MELBOURNE CANBERRA | ADELAIDE | PERTH

Introduction  Trade credit perspective  Rights of Rot creditors  PMSI’s  “All moneys clauses”  Processed and co-mingled  Hirers and lessors  Transitional provisions  Registration

‘ Personal Property’

Registration

TRADE CREDITORS’ RIGHTS Retention of title (RoT) Hirers and lessors of property Charges over personal property

Retention of title “We’re not all that worried about PPS. The only impact to us is retention of title. We’re the owner of the goods anyway, so there won’t be any other security interest we need to compete with. If anything, we’ll just register if we’re concerned that a debtor is going to end up in trouble.” National credit manager, large corporate client

The good news 1.RoT claim is a ‘PMSI’ which creates a ‘Super Priority’. 2.Greater rights in respect of processed and co-mingled goods.

PMSI interest creates SUPER PRIORITY.

PMSI and ‘all moneys’ clauses

EXPANDED RIGHTS OF RoT CREDITORS Processed goods Co-mingled goods Accessions

Hirers and lessors PPSA catches hire or lease agreements if they are for: (a)a term of a year or more; (b)an indefinite term; or (c)a term of up to a year that is automatically renewable.

Transitional Provisions Single or multiple “Security Agreement(s)” Priority rules

Conclusion  Purpose – to formalise and clarify competing rights  Real –v– personal property  RoT creditors are amongst the potential winners  Transitional provisions  Have a clear plan in place for what and how to register (and if you haven’t registered yet, do so)  Have your terms and conditions reviewed (if you haven’t already)