PERSONAL PROPERTY SECURITIES ACT 2009 - SECT 73 Priority between security interests and declared statutory interests

PERSONAL PROPERTY SECURITIES ACT 2009 - SECT 73

Interests arising under a law etc. in the ordinary course of business

  (1)   An interest (the priority interest ) in collateral has priority over a security interest in the collateral if:

  (a)   the priority interest arises (by being created, arising or being provided for):

  (i)   under a law of the Commonwealth, a State or a Territory, unless the person who owns the collateral in which the priority interest is granted agrees to the interest; or

  (ii)   by operation of the general law; and

  (b)   the priority interest arises in relation to providing goods or services in the ordinary course of business; and

  (c)   the person who holds the priority interest provided those goods or services; and

  (d)   no law of the Commonwealth, a State or a Territory provides for the priority between the priority interest and the security interest; and

Example: A law of the Commonwealth, a State or a Territory to which subsection   (2) applies is a law that provides for the priority between the priority interest and the security interest.

  (e)   the person who holds the priority interest acquired the interest without actual knowledge that the acquisition constitutes a breach of the security agreement that provides for the security interest.

Note:   The priority interest might be an interest to which this Act would otherwise not apply (see subsection   8(2)).

Statutory interests declared by law

  (2)   The priority between an interest in collateral (the statutory interest ) that arises, by being created, arising or being provided for, under a law of the Commonwealth, a State or a Territory (the relevant jurisdiction ) and a security interest in the same collateral is to be determined in accordance with that law if, and only if:

  (a)   that law declares that this subsection applies to statutory interests of that kind; and

  (b)   the statutory interest arises after the declaration comes into effect.

Note:   The statutory interest might be an interest to which this Act would otherwise not apply (see subsection   8(2)).

  (3)   However, for the purposes of subsection   (2), as it applies to a law of the Commonwealth:

  (a)   the Minister may, by an instrument made under subsection   (4), make the declaration required by paragraph   (2)(a); and

  (b)   the priority mentioned in subsection   (2) may be determined in accordance with that instrument.

  (4)   The Minister may make a legislative instrument containing a declaration, or determining priority, or both, for the purposes of subsection   (3).

  (5)   Subsection   (2) is subject to subsection   (1).

Rights to payment in connection with specifically identified land

  (6)   An interest (the priority interest ) in collateral has priority over a security interest in the collateral if the priority interest is an interest of a kind mentioned in subparagraph   8(1)(f)(ii) (certain rights to payment in respect of land).

Interests arising under the general law

  (7)   The priority between an interest in collateral (the general law interest ) that arises by operation of the general law and a security interest in the same collateral is to be determined in accordance with an instrument made under subsection   (8) if, and only if:

  (a)   no law of the Commonwealth (other than this Act and that instrument) provides for the priority between the general law interest and the security interest; and

  (b)   the instrument provides that this subsection applies to general law interests of that kind; and

  (c)   the general law interest arises after the instrument comes into effect.

  (8)   The Minister may make a legislative instrument for the purposes of subsection   (7).

  (9)   Subsection   (7) is subject to subsection   (1).

Note:   This section does not apply to priorities in relation to interests that arise before the registration commencement time (within the meaning of section   306). Priorities in relation to such interests are unaffected by this Act (see section   312).