Written by The case of In the matter of OneSteel Manufacturing Pty Limited (administrators appointed) [2017] NSWSC 21 demonstrates the crucial importance of ensuring that registrations on the Personal Properties Securities Register (PPSR) are correct if you are the lessor of plant and equipment and other goods.
Alleasing Pty Ltd leased a crusher and spare parts to OneSteet Manufacturing Pty Ltd (OneSeel) – which were PPS leases within the meaning of the Personal Property Securities Act 2008 (PPSA). However, the registrations were against OneSteel’s ABN number and not its ACN number, as prescribed by the Regulations.
Hence when OneSteel appointed administrators, the administrators informed Alleasing that the registrations were void. The Court was asked to consider whether the registrations were indeed invalid, and if they were, whether Alleasing should be entitled to an extension of time to allow the registrations registered after OneSteels administrators were appointed to be declared effective, and whether the vesting of the crusher was unconstitutional as an acquisition of property on unjust terms.
Ultimately the court found the registrations to be ineffective, and denied Alleasing an extension of time. The Court also found that the vesting provisions of the PPSA did not result in an ‘acquisition of property,’ so Alleasing’s constitutional argument failed as well. This case showcases the serious financial consequences that arise from an administrative mistake when registering a security interest on the PPSR and not amending it promptly.