Acts and Regulations

P-7.1 - Personal Property Security Act

Section 28
Disposition versions

Full text
Security interests in proceeds
28(1)Subject to this Act, if collateral is dealt with or otherwise gives rise to proceeds, the security interest
(a) continues in the collateral unless the secured party expressly or impliedly authorizes the dealing, and
(b) extends to the proceeds.
28(2)If a secured party enforces a security interest against both the collateral and the proceeds, the amount secured by the security interest in the collateral and the proceeds is limited to the market value of the collateral at the date of the dealing.
28(2.1)The limitation of the amount secured by a security interest as provided in subsection (2) does not apply where the collateral is investment property.
28(3)A security interest in proceeds is a continuously perfected security interest if the interest in the original collateral is perfected by registration of a financing statement under section 25 that
(a) includes a description of the proceeds that would be sufficient to perfect a security interest in original collateral of the same kind,
(b) includes a description of the original collateral, if the proceeds are of a kind that are within the description of the original collateral, or
(c) includes a description of the original collateral, if the proceeds consist of money, cheques or deposit accounts in a bank, credit union or similar financial institution.
28(4)If the security interest in the original collateral is perfected other than in a manner referred to in subsection (3), the security interest in the proceeds is a continuously perfected security interest for the first fifteen days after the security interest in the original collateral attaches to the proceeds but becomes unperfected on the expiry of that period, unless the security interest in the proceeds is otherwise perfected by any of the methods and under the circumstances specified in this Act for original collateral of the same kind.
2008, c.S-5.8, s.109
Security interests in proceeds
28(1)Subject to this Act, if collateral is dealt with or otherwise gives rise to proceeds, the security interest
(a) continues in the collateral unless the secured party expressly or impliedly authorizes the dealing, and
(b) extends to the proceeds.
28(2)If a secured party enforces a security interest against both the collateral and the proceeds, the amount secured by the security interest in the collateral and the proceeds is limited to the market value of the collateral at the date of the dealing.
28(3)A security interest in proceeds is a continuously perfected security interest if the interest in the original collateral is perfected by registration of a financing statement under section 25 that
(a) includes a description of the proceeds that would be sufficient to perfect a security interest in original collateral of the same kind,
(b) includes a description of the original collateral, if the proceeds are of a kind that are within the description of the original collateral, or
(c) includes a description of the original collateral, if the proceeds consist of money, cheques or deposit accounts in a bank, credit union or similar financial institution.
28(4)If the security interest in the original collateral is perfected other than in a manner referred to in subsection (3), the security interest in the proceeds is a continuously perfected security interest for the first fifteen days after the security interest in the original collateral attaches to the proceeds but becomes unperfected on the expiry of that period, unless the security interest in the proceeds is otherwise perfected by any of the methods and under the circumstances specified in this Act for original collateral of the same kind.