Commonwealth Consolidated Acts

PERSONAL PROPERTY SECURITIES ACT 2009 - SECT 37

Reattachment of security interest

  (1)   If a grantor or debtor sells or leases goods that are subject to a security interest, and the buyer or lessee takes the goods free of the security interest because of the operation of this Act, the security interest reattaches to the goods at a particular time (the repossession time ) if, at that time, the goods come into the possession of the grantor or debtor, or of a transferee of chattel paper created by the sale or lease, in any of the following circumstances:

  (a)   in the case of a sale--the contract of sale is rescinded;

  (b)   in the case of a lease--the lease expires or is rescinded;

  (c)   the transferee seizes the goods in the exercise of a right in enforcing a security agreement;

  (d)   the grantor or debtor repossesses the goods in the exercise of a right in enforcing the contract of sale or the lease;

  (e)   any other circumstances prescribed by the regulations.

Note:   Section   76 deals with the priority of a security interest that reattaches under this section.

Perfection of security interest

  (2)   The perfection of the security interest, and the time of registration or perfection of the security interest, are to be determined as if the goods had not been sold or leased, if:

  (a)   the security interest reattaches to the goods under subsection   (1); and

  (b)   the security interest was perfected by registration immediately before the time of the acquisition; and

  (c)   the registration is effective at the repossession time.