The Personal Property Security Act (PPSA) In Alberta
Protect your security interests to make sure you are paid back.
The Personal Property Security Act (Alberta) governs the personal property security transactions in the Province of Alberta. The PPSA is a code that provides for the creation, perfection, priority and enforcement of security interests in personal property in the Province of Alberta. Security interests are common in the context of financing where a creditor loans money to a debtor and takes a charge (or security interest) in certain personal property as collateral for the loan.
How Do You Create A Security Interest In Personal Property?
In order to create a secured interest in personal property the secured party (creditor) must have an agreement with the debtor. The debtor must be property described (pursuant to the PPSA regulations), and must have the power to grant the security interest in the collateral. The collateral must also be properly described. The power to grant a security interest does not necessarily mean that the debtor must “own the property”. Instead it means that they must have rights in the collateral to transfer rights to a secured party. For example, a purchase under a conditional sale agreement does not own the collateral, but has possessory rights in the collateral that enables them to grant a security interest.
What Goes In The Security Agreement?
The security agreement that is applicable to a particular secured financing transaction is contextual to the collateral. Therefore great care should be taken to ensure that a proper security agreement is used. The lawyers at Kahane Law Office can ensure that your security agreement is property drafted in accordance with PPSA regulations.
The security agreement will be signed by the debtors, will adequately describe the collateral to be charged, and will contain a specific “charging provision” which will use traditional language relating to the security interest. The security agreement will also deal with remedies on default that the secured party can use against the debtor.
Perfecting Security Interests through Registration
The most common way to perfect a security interest is by registration. Registration is effected by properly completing a Financing Statement (or a Financing Change Statement) and registering it through a registry office. When completing a Financing Statement it is critical that the debtor and the collateral are accurately described in accordance with the PPSA. When the registration is complete a verification statement, setting out the essential information relating to the registration will be provided. Registration is effective at the time that is assigned to it by the registrar
Help Protecting Your Financial Interest
The corporate and commercial lawyers at Kahane Law Office in Calgary, Alberta can help you to properly and effectively secure your interests in accordance with the Personal Property Security Act (Alberta). You can reach us toll-free at 1-877-225-8817 (or 403-225-8810 locally in Calgary, Alberta or (780) 571-8463 in the Edmonton Area), or email us directly here.