Posted on April 12, 2021 in
Written by: David B. Honig
In every Canadian province and territory, there are personal property security laws that apply to most types of personal property. Under this legislation, a security interest may be granted over time and then acquired on the basis of a single general security agreement. Subject to an agreement between the parties to postpone the seizure, the guarantee is immediately linked to personal property over which the debtor has rights and, in the case of acquisition of rights, to personal property acquired at a later date. Can security interests extend to acquired assets? Can security interests guarantee future obligations? Attachment (see Section 12) is a technical concept under the Personnel Property Safety Act. In the simplest case, this means that the guaranteed party and the debtor enter into a written agreement. For most consumer transactions with security removed, seizure requirements are met by a written agreement with legal consideration (section 10). The specific term used in the law is “value.” A security agreement documents the intention to give another party a personal property security interest to ensure that a loan is repaid or that a promise is kept. Section 19 is an important part of the Personal Property Security Act. It is said that a security interest is “perfected” when it is “attached” to the property and that “all the steps necessary for perfection” are carried out in accordance with the law. Perfection gives the insured party certain rights and remedies under the law.
These legal rights and remedies mean that the distinction between title and property interests is not as important as under the old laws. It is important that creditors ensure that they meet the requirements of the PPSA in order to obtain the legal rights of an insured party. As a general rule, any change or amendment or other outright obligation that would affect the surety may be a defence to the bond`s commitment beyond its guarantee. Therefore, a guarantee normally provides that any increase or other change in the secured obligations, any extension at the time of payment and any performance or non-performance of the guarantee provided by the borrower or other surety does not affect the liability of the bond as part of its guarantee.