New South Wales Consolidated Acts

REGISTRATION OF INTERESTS IN GOODS ACT 1986 - SECT 10

10 Rights of creditor and purchaser where registrable interest defeated

(1) Where:

(a) a person who is not a dealer in goods of a class specified in an order in force under section 9 (1) purchases any such goods from such a dealer,

(b) at any time before payment of the purchase price, the dealer had notice that the goods were subject to a registrable interest, and

(c) immediately before payment of the purchase price, the registrable interest had not been discharged or cancelled,

the dealer is liable to the creditor who had the registrable interest for loss sustained by the creditor by reason of the operation of section 9 in relation to the registrable interest.

(1A) A dealer is not liable to a creditor in the circumstances referred to in subsection (1) if the dealer purchased the goods concerned freed and discharged from the registrable interest of the creditor by the operation of section 9.

(2) Where, by the operation of section 9, a purchaser of goods acquires the goods freed and discharged from a registrable interest but, at the time of the acquisition, part only of the purchase price is paid to the seller:

(a) the creditor who had the registrable interest is, to the extent of the amount that was owed by the debtor to the creditor under the registrable interest, subrogated to the rights that, but for the subrogation, the seller would have in relation to payment by the purchaser of the balance of the purchase price of the goods, and

(b) the purchaser of the goods obtains a good discharge:

(i) as against the debtor-for any payment of part of the purchase price made under paragraph (a) to the creditor, and

(ii) as against the debtor and the creditor-for any payment of part of the purchase price made before the purchaser is notified in writing of the rights of the creditor under that paragraph.

(3) Where:

(a) by the operation of section 9, a purchase of goods results in the goods being freed and discharged from a registrable interest, and

(b) the contract of purchase is subsequently rescinded,

the registrable interest revives and has effect as if the purchase had not occurred.