Acts and Regulations

P-7.1 - Personal Property Security Act

Section 38
Disposition versions

Full text
Security interest in accessions
38(1)In this section
“other goods” means goods to which an accession is installed or affixed;(autres objets)
“secured party” includes a receiver;(partie garantie)
“the whole” means an accession and the goods to which the accession is installed or affixed.(le tout)
38(2)Except as provided in section 30 and subsections (3), (4) and (7), a security interest in goods that attaches before or when the goods become an accession has priority with respect to the goods over a claim to the goods as an accession made by a person with an interest in the whole.
38(3)A security interest referred to in subsection (2) is subordinate to the interest of a person who acquires for value an interest in the whole after the goods become an accession, including an assignee for value of the interest of a person with an interest in the whole after the goods become an accession, if the interest is acquired without knowledge and before the security interest is perfected.
38(4)A security interest referred to in subsection (2) is subordinate to the interest of a person with a security interest taken and perfected in the whole who
(a) makes an advance under a security agreement after the goods become an accession, but only with respect to that advance, or
(b) acquires the right to retain the whole in satisfaction of the obligation secured,
without knowledge of the security interest in the accession and before it is perfected.
38(5)A security interest in goods that attaches after the goods become an accession is subordinate to the interest of a person who has an interest in the other goods when the goods become an accession and who
(a) has not consented to the security interest,
(b) has not disclaimed an interest in the goods or accessions,
(c) has not entered into an agreement entitling the person to remove the accession, or
(d) is not otherwise precluded from preventing the debtor from removing the accession.
38(6)A security interest in goods that attaches after the goods become an accession is subordinate to the interest of a person who acquires an interest in the whole after the goods become an accession, if the interest is acquired without knowledge and before the security interest in the accession is perfected.
38(7)Subject to subsection (8), a security interest in goods that attaches before, at the time or after the goods become an accession is subordinate to the interest of a judgment creditor referred to in paragraph 20(1)(a) if the security interest is not perfected when a notice of judgment referred to in paragraph 20(1)(a) is registered.
38(8)The interest of a judgment creditor referred to in paragraph 20(1)(a) does not take priority under subsection (7) over a purchase money security interest in goods that is perfected not later than fifteen days after the goods become an accession.
38(9)A secured party who has the right, under this Act, to remove an accession from the whole shall exercise the right of removal in a manner that causes no unnecessary damage or injury to the other goods or that puts the person in possession of the whole to any greater inconvenience than is necessarily incidental to the removal of the accession.
38(10)A person, other than the debtor, who has an interest in the whole when the goods subject to the security interest become an accession is entitled to reimbursement for any damages to the interest of that person in the whole caused during the removal of the accession, but is not entitled to reimbursement for diminution in the value of the whole caused by the absence of the accession or by the necessity to replace it.
38(11)A person entitled to reimbursement under subsection (10) may refuse permission to remove the accession until the secured party has given adequate security for the reimbursement.
38(12)The secured party may apply to the Court for one or more of the following orders:
(a) an order determining the person entitled to reimbursement under this section;
(b) an order determining the amount and kind of security to be provided by the secured party;
(c) an order specifying the depository for the security;
(d) an order authorizing the removal of the accession without the provision of security for reimbursement under subsection (11).
38(13)If the interest of a person with an interest in the whole is subordinate to a security interest in the accession under this section, the person with an interest in the whole may, before the accession has been removed from the whole by the secured party, retain the accession on payment to the secured party of the lesser of the following:
(a) the amount secured by the security interest entitled to priority; and
(b) the market value of the accession were the accession to be removed from the other goods.
38(14)The secured party who has a right to remove the accession from the whole shall give a notice of the secured party’s intention to remove the accession to each person
(a) who is known by the secured party to have an interest in the other goods or in the whole, and
(b) who has registered a financing statement that includes the name of the debtor and a description of the other goods, or that includes the serial number of the other goods if the other goods are of a kind that are prescribed as serial numbered goods.
38(15)A notice under subsection (14) shall contain
(a) the name and address of the secured party,
(b) a description of the goods to be removed,
(c) the amount required to satisfy the obligations secured by the security interest,
(d) the market value of the accession,
(e) a description of the other goods, and
(f) a statement of intention to remove the accession unless the amount referred to in subsection (13) is paid on or before a specified date that is not less than fifteen days after the notice is given in accordance with subsection (14).
38(16)A notice under subsection (14) shall be given at least fifteen days before removal of the accession and may be given in accordance with section 69 or by registered mail addressed to the address of the person to be notified that was registered as part of the financing statement referred to in paragraph (14)(b).
38(17)A person entitled to receive a notice under subsection (14) may apply to the Court for an order postponing removal of the accession.
1994, c.22, s.7; 1995, c.33, s.6; 2004, c.35, s.6
Security interest in accessions
38(1)In this section
“other goods” means goods to which an accession is installed or affixed;
“secured party” includes a receiver;
“the whole” means an accession and the goods to which the accession is installed or affixed.
38(2)Except as provided in section 30 and subsections (3), (4) and (7), a security interest in goods that attaches before or when the goods become an accession has priority with respect to the goods over a claim to the goods as an accession made by a person with an interest in the whole.
38(3)A security interest referred to in subsection (2) is subordinate to the interest of a person who acquires for value an interest in the whole after the goods become an accession, including an assignee for value of the interest of a person with an interest in the whole after the goods become an accession, if the interest is acquired without knowledge and before the security interest is perfected.
38(4)A security interest referred to in subsection (2) is subordinate to the interest of a person with a security interest taken and perfected in the whole who
(a) makes an advance under a security agreement after the goods become an accession, but only with respect to that advance, or
(b) acquires the right to retain the whole in satisfaction of the obligation secured,
without knowledge of the security interest in the accession and before it is perfected.
38(5)A security interest in goods that attaches after the goods become an accession is subordinate to the interest of a person who has an interest in the other goods when the goods become an accession and who
(a) has not consented to the security interest,
(b) has not disclaimed an interest in the goods or accessions,
(c) has not entered into an agreement entitling the person to remove the accession, or
(d) is not otherwise precluded from preventing the debtor from removing the accession.
38(6)A security interest in goods that attaches after the goods become an accession is subordinate to the interest of a person who acquires an interest in the whole after the goods become an accession, if the interest is acquired without knowledge and before the security interest in the accession is perfected.
38(7)Subject to subsection (8), a security interest in goods that attaches before, at the time or after the goods become an accession is subordinate to the interest of a judgment creditor referred to in paragraph 20(1)(a) if the security interest is not perfected when a notice of judgment referred to in paragraph 20(1)(a) is registered.
38(8)The interest of a judgment creditor referred to in paragraph 20(1)(a) does not take priority under subsection (7) over a purchase money security interest in goods that is perfected not later than fifteen days after the goods become an accession.
38(9)A secured party who has the right, under this Act, to remove an accession from the whole shall exercise the right of removal in a manner that causes no unnecessary damage or injury to the other goods or that puts the person in possession of the whole to any greater inconvenience than is necessarily incidental to the removal of the accession.
38(10)A person, other than the debtor, who has an interest in the whole when the goods subject to the security interest become an accession is entitled to reimbursement for any damages to the interest of that person in the whole caused during the removal of the accession, but is not entitled to reimbursement for diminution in the value of the whole caused by the absence of the accession or by the necessity to replace it.
38(11)A person entitled to reimbursement under subsection (10) may refuse permission to remove the accession until the secured party has given adequate security for the reimbursement.
38(12)The secured party may apply to the Court for one or more of the following orders:
(a) an order determining the person entitled to reimbursement under this section;
(b) an order determining the amount and kind of security to be provided by the secured party;
(c) an order specifying the depository for the security;
(d) an order authorizing the removal of the accession without the provision of security for reimbursement under subsection (11).
38(13)If the interest of a person with an interest in the whole is subordinate to a security interest in the accession under this section, the person with an interest in the whole may, before the accession has been removed from the whole by the secured party, retain the accession on payment to the secured party of the lesser of the following:
(a) the amount secured by the security interest entitled to priority; and
(b) the market value of the accession were the accession to be removed from the other goods.
38(14)The secured party who has a right to remove the accession from the whole shall give a notice of the secured party’s intention to remove the accession to each person
(a) who is known by the secured party to have an interest in the other goods or in the whole, and
(b) who has registered a financing statement that includes the name of the debtor and a description of the other goods, or that includes the serial number of the other goods if the other goods are of a kind that are prescribed as serial numbered goods.
38(15)A notice under subsection (14) shall contain
(a) the name and address of the secured party,
(b) a description of the goods to be removed,
(c) the amount required to satisfy the obligations secured by the security interest,
(d) the market value of the accession,
(e) a description of the other goods, and
(f) a statement of intention to remove the accession unless the amount referred to in subsection (13) is paid on or before a specified date that is not less than fifteen days after the notice is given in accordance with subsection (14).
38(16)A notice under subsection (14) shall be given at least fifteen days before removal of the accession and may be given in accordance with section 69 or by registered mail addressed to the address of the person to be notified that was registered as part of the financing statement referred to in paragraph (14)(b).
38(17)A person entitled to receive a notice under subsection (14) may apply to the Court for an order postponing removal of the accession.
1994, c.22, s.7; 1995, c.33, s.6; 2004, c.35, s.6