The case of In the matter of OneSteel Manufacturing Pty Limited (administrators appointed)  NSWSC 21 serves as a reminder of the importance of ensuring that registrations on the Personal Property Securities Register (PPSR) are correct if you are the lessor of plant and equipment or other goods. Alleasing Pty Ltd had leased a crusher and spare parts to OneSteel Manufacturing Pty Ltd. The leases were PPS leases within the meaning of s 13 of the PPSA and Alleasing had registered a financing statement in respect of the crusher, and later the spare parts. However, by mistake, the registrations were entered against OneSteel’s 11-digit ABN and not its 9-digit ACN as required by the PPSA Regulations.
The administrators of OneSteel informed Alleasing that the registrations were ineffective due to their mistake in registration. Alleasing then amended its original registration to include OneSteel’s ACN. The court considered whether the original registrations were valid and if not, whether Alleasing could be entitled to an extension of time to allow the registrations after OneSteel’s administrators were appointed to be declared effective.
The Court held that the original registrations were ineffective under s 165 of the PPSA as a search of the PPSR for OneSteel’s ACN would not have revealed the original registrations. The amended registrations were also ineffective because once administrators had been appointed to OneSteel, Alleasing’s security interest was unperfected, and the property had already vested in OneSteel.
This case is illustrative of the consequences of failing to comply with the complicated regulations of the PPSR. Alleasing had spent over $23 million in funding the design, supply, installation, assembly, construction, and commissioning of the crusher and had funded the acquisition of the parts.