Acts and Regulations

P-7.1 - Personal Property Security Act

Section 17
Disposition versions

Full text
Collateral in the secured party’s possession: rights and obligations
17(1)In this section
“secured party” includes a receiver.
17(2)A secured party shall use reasonable care in the custody and preservation of collateral in the secured party’s possession and, unless otherwise agreed, in the case of chattel paper or an instrument, reasonable care includes taking necessary steps to preserve rights against other persons.
17(3)Unless otherwise agreed, if collateral is in the secured party’s possession,
(a) reasonable expenses, including the cost of insurance and payment of taxes or other charges incurred in obtaining and maintaining possession of the collateral and in its preservation are chargeable to the debtor and are secured by the collateral,
(b) the risk of loss or damage, except if caused by the negligence of the secured party, is on the debtor to the extent of any deficiency in any insurance coverage,
(c) the secured party may hold as additional security any increase or profits, except money, resulting from the collateral,
(d) the secured party shall apply any increase or profits in the form of money resulting from the collateral, unless remitted to the debtor, immediately on its receipt in reduction of the obligation secured, and
(e) the secured party shall keep the collateral identifiable, but fungible collateral may be commingled.
17(4)Subject to subsection (2), a secured party may use the collateral
(a) in the manner and to the extent provided in the security agreement,
(b) for the purpose of preserving the collateral or its value, or
(c) in accordance with an order of the Court.
2008, c.S-5.8, s.109
Collateral in the secured party’s possession: rights and obligations
17(1)In this section
“secured party” includes a receiver.
17(2)A secured party shall use reasonable care in the custody and preservation of collateral in the secured party’s possession and, unless otherwise agreed, in the case of chattel paper, a security or an instrument, reasonable care includes taking necessary steps to preserve rights against other persons.
17(3)Unless otherwise agreed, if collateral is in the secured party’s possession,
(a) reasonable expenses, including the cost of insurance and payment of taxes or other charges incurred in obtaining and maintaining possession of the collateral and in its preservation are chargeable to the debtor and are secured by the collateral,
(b) the risk of loss or damage, except if caused by the negligence of the secured party, is on the debtor to the extent of any deficiency in any insurance coverage,
(c) the secured party may hold as additional security any increase or profits, except money, resulting from the collateral,
(d) the secured party shall apply any increase or profits in the form of money resulting from the collateral, unless remitted to the debtor, immediately on its receipt in reduction of the obligation secured, and
(e) the secured party shall keep the collateral identifiable, but fungible collateral may be commingled.
17(4)Subject to subsection (2), a secured party may use the collateral
(a) in the manner and to the extent provided in the security agreement,
(b) for the purpose of preserving the collateral or its value, or
(c) in accordance with an order of the Court.