Acts and Regulations

P-7.1 - Personal Property Security Act

Section 35
Disposition versions

Full text
Residual (general) priority rules
35(1)Where this Act provides no other method for determining priority between competing security interests in the same collateral, the following priority rules apply:
(a) priority between perfected security interests is determined by the order of the occurrence of the following:
(i) the registration of a financing statement under section 25 without regard to the time of attachment of the security interest,
(ii) possession of the collateral under section 24 without regard to the time of attachment of the security interest, or
(iii) perfection under sections 5, 7, 7.1, 26, 29 or 74,
whichever is earliest;
(b) a perfected security interest has priority over an unperfected security interest; and
(c) priority between unperfected security interests is determined by the order of attachment of the security interests.
35(2)For the purposes of subsection (1), a continuously perfected security interest shall be treated at all times as if perfected by the method by which it was originally perfected.
35(3)For the purposes of subsection (1) and subject to section 28, the time of registration, possession or perfection of a security interest in original collateral is also the time of registration, possession or perfection of a security interest in its proceeds.
35(4)A security interest in goods that are equipment and are of a kind that are prescribed as serial numbered goods is not registered or perfected by registration for the purposes of subsection (1), (7) or (8) or 34(1) unless a financing statement relating to the security interest that includes a description of the goods by serial number is registered with the serial number entered into the field labelled for the receipt of serial numbers.
35(5)Subject to subsection (6), the priority which a security interest has under subsection (1) applies to all advances, including future advances.
35(6)A perfected security interest has priority over the interest of a judgment creditor referred to in paragraph 20(1)(a) only to the extent of
(a) advances made before the judgment creditor registers the notice of judgment referred to in paragraph 20(1)(a),
(b) advances made before the secured party has knowledge of the registration of the notice of judgment referred to in paragraph 20(1)(a),
(c) advances made in accordance with a statutory requirement, or a legally binding obligation owing to a person other than the debtor entered into by the secured party before acquiring the knowledge referred to in paragraph (b), and
(d) reasonable costs and expenses incurred by the secured party for the protection, preservation, maintenance or repair of the collateral.
35(7)If a registration lapses as a result of a failure to renew it or if a registration is discharged without authorization or in error, and the secured party re-registers in accordance with the regulations within thirty days after the lapse or discharge, the lapse or discharge does not affect the priority ranking of the security interest to which the lapsed or discharged registration relates as against a competing perfected security interest that immediately before the lapse or discharge had a subordinate priority ranking, except to the extent that the competing security interest secures advances made or contracted for after the lapse or discharge and before the re-registration.
35(8)If a debtor transfers an interest in collateral that, at the time of the transfer, is subject to a perfected security interest, that security interest has priority over any other security interest granted by the transferee before the transfer except to the extent that the security interest granted by the transferee secures advances made or contracted for
(a) after the expiry of fifteen days from when the secured party who holds the security interest in the transferred collateral has knowledge of the information required to register a financing change statement in accordance with section 51 disclosing the transferee as the new debtor, and
(b) before the secured party referred to in paragraph (a) takes possession of the collateral or registers a financing change statement in accordance with section 51 disclosing the transferee as the new debtor.
35(9)Subsection (8) does not apply if the transferee acquires the debtor’s interest free of the security interest granted by the debtor.
2004, c.35, s.3; 2008, c.S-5.8, s.109
Residual (general) priority rules
35(1)Where this Act provides no other method for determining priority between competing security interests in the same collateral, the following priority rules apply:
(a) priority between perfected security interests is determined by the order of the occurrence of the following:
(i) the registration of a financing statement under section 25 without regard to the time of attachment of the security interest,
(ii) possession of the collateral under section 24 without regard to the time of attachment of the security interest, or
(iii) perfection under sections 5, 7, 7.1, 26, 29 or 74,
whichever is earliest;
(b) a perfected security interest has priority over an unperfected security interest; and
(c) priority between unperfected security interests is determined by the order of attachment of the security interests.
35(2)For the purposes of subsection (1), a continuously perfected security interest shall be treated at all times as if perfected by the method by which it was originally perfected.
35(3)For the purposes of subsection (1) and subject to section 28, the time of registration, possession or perfection of a security interest in original collateral is also the time of registration, possession or perfection of a security interest in its proceeds.
35(4)A security interest in goods that are equipment and are of a kind that are prescribed as serial numbered goods is not registered or perfected by registration for the purposes of subsection (1), (7) or (8) or 34(1) unless a financing statement relating to the security interest that includes a description of the goods by serial number is registered with the serial number entered into the field labelled for the receipt of serial numbers.
35(5)Subject to subsection (6), the priority which a security interest has under subsection (1) applies to all advances, including future advances.
35(6)A perfected security interest has priority over the interest of a judgment creditor referred to in paragraph 20(1)(a) only to the extent of
(a) advances made before the judgment creditor registers the notice of judgment referred to in paragraph 20(1)(a),
(b) advances made before the secured party has knowledge of the registration of the notice of judgment referred to in paragraph 20(1)(a),
(c) advances made in accordance with a statutory requirement, or a legally binding obligation owing to a person other than the debtor entered into by the secured party before acquiring the knowledge referred to in paragraph (b), and
(d) reasonable costs and expenses incurred by the secured party for the protection, preservation, maintenance or repair of the collateral.
35(7)If a registration lapses as a result of a failure to renew it or if a registration is discharged without authorization or in error, and the secured party re-registers in accordance with the regulations within thirty days after the lapse or discharge, the lapse or discharge does not affect the priority ranking of the security interest to which the lapsed or discharged registration relates as against a competing perfected security interest that immediately before the lapse or discharge had a subordinate priority ranking, except to the extent that the competing security interest secures advances made or contracted for after the lapse or discharge and before the re-registration.
35(8)If a debtor transfers an interest in collateral that, at the time of the transfer, is subject to a perfected security interest, that security interest has priority over any other security interest granted by the transferee before the transfer except to the extent that the security interest granted by the transferee secures advances made or contracted for
(a) after the expiry of fifteen days from when the secured party who holds the security interest in the transferred collateral has knowledge of the information required to register a financing change statement in accordance with section 51 disclosing the transferee as the new debtor, and
(b) before the secured party referred to in paragraph (a) takes possession of the collateral or registers a financing change statement in accordance with section 51 disclosing the transferee as the new debtor.
35(9)Subsection (8) does not apply if the transferee acquires the debtor’s interest free of the security interest granted by the debtor.
2004, c.35, s.3; 2008, c.S-5.8, s.109
Residual (general) priority rules
35(1)Where this Act provides no other method for determining priority between competing security interests in the same collateral, the following priority rules apply:
(a) priority between perfected security interests is determined by the order of the occurrence of the following:
(i) the registration of a financing statement under section 25 without regard to the time of attachment of the security interest,
(ii) possession of the collateral under section 24 without regard to the time of attachment of the security interest, or
(iii) perfection under sections 5, 7, 26, 29 or 74,
whichever is earliest;
(b) a perfected security interest has priority over an unperfected security interest; and
(c) priority between unperfected security interests is determined by the order of attachment of the security interests.
35(2)For the purposes of subsection (1), a continuously perfected security interest shall be treated at all times as if perfected by the method by which it was originally perfected.
35(3)For the purposes of subsection (1) and subject to section 28, the time of registration, possession or perfection of a security interest in original collateral is also the time of registration, possession or perfection of a security interest in its proceeds.
35(4)A security interest in goods that are equipment and are of a kind that are prescribed as serial numbered goods is not registered or perfected by registration for the purposes of subsection (1), (7) or (8) or 34(1) unless a financing statement relating to the security interest that includes a description of the goods by serial number is registered with the serial number entered into the field labelled for the receipt of serial numbers.
35(5)Subject to subsection (6), the priority which a security interest has under subsection (1) applies to all advances, including future advances.
35(6)A perfected security interest has priority over the interest of a judgment creditor referred to in paragraph 20(1)(a) only to the extent of
(a) advances made before the judgment creditor registers the notice of judgment referred to in paragraph 20(1)(a),
(b) advances made before the secured party has knowledge of the registration of the notice of judgment referred to in paragraph 20(1)(a),
(c) advances made in accordance with a statutory requirement, or a legally binding obligation owing to a person other than the debtor entered into by the secured party before acquiring the knowledge referred to in paragraph (b), and
(d) reasonable costs and expenses incurred by the secured party for the protection, preservation, maintenance or repair of the collateral.
35(7)If a registration lapses as a result of a failure to renew it or if a registration is discharged without authorization or in error, and the secured party re-registers in accordance with the regulations within thirty days after the lapse or discharge, the lapse or discharge does not affect the priority ranking of the security interest to which the lapsed or discharged registration relates as against a competing perfected security interest that immediately before the lapse or discharge had a subordinate priority ranking, except to the extent that the competing security interest secures advances made or contracted for after the lapse or discharge and before the re-registration.
35(8)If a debtor transfers an interest in collateral that, at the time of the transfer, is subject to a perfected security interest, that security interest has priority over any other security interest granted by the transferee before the transfer except to the extent that the security interest granted by the transferee secures advances made or contracted for
(a) after the expiry of fifteen days from when the secured party who holds the security interest in the transferred collateral has knowledge of the information required to register a financing change statement in accordance with section 51 disclosing the transferee as the new debtor, and
(b) before the secured party referred to in paragraph (a) takes possession of the collateral or registers a financing change statement in accordance with section 51 disclosing the transferee as the new debtor.
35(9)Subsection (8) does not apply if the transferee acquires the debtor’s interest free of the security interest granted by the debtor.
2004, c.35, s.3