Acts and Regulations

P-7.1 - Personal Property Security Act

Section 61
Disposition versions

Full text
Right to retain collateral in satisfaction of debt
61(1)After default, the secured party may propose to take the collateral in satisfaction of the obligation secured by it and shall give notice of the proposal to
(a) the debtor or any other person who is known by the secured party to be an owner of the collateral,
(b) a creditor or person with a security interest in the collateral whose security interest is subordinate to that of the secured party and
(i) who has registered, before the notice of the proposal is given to the debtor, a financing statement that includes the name of the debtor or that includes the serial number of the collateral if the collateral is goods of a kind that are prescribed as serial numbered goods, or
(ii) whose security interest was perfected by possession when the secured party seized or repossessed the collateral,
(c) a judgment creditor whose interest in the collateral is subordinate to that of the secured party and who has registered, before the notice of the proposal is given to the debtor, a notice of judgment that includes the name of the debtor or that includes the serial number of the collateral if the collateral is goods of a kind that are prescribed as serial numbered goods, and
(d) any other person with an interest in the collateral who has given a written notice to the secured party of that person’s interest before the notice of the proposal is given to the debtor.
61(2)If the interest in the collateral of any person entitled to a notice under subsection (1) would be adversely affected by the secured party’s proposal, that person may give to the secured party a notice of objection within fifteen days after the notice under subsection (1) is given.
61(3)Subject to subsections (6) and (7), if a notice of objection is given under subsection (2), the secured party shall dispose of the collateral under section 59.
61(4)If no notice of objection is given under subsection (2), the secured party
(a) shall be deemed, on the expiry of the fifteen day period or periods referred to in subsection (2), to have irrevocably elected to take the collateral in satisfaction of the obligation secured by it, and
(b) is entitled to hold or dispose of the collateral free from all rights and interests of the debtor, any person entitled to receive a notice under paragraph (1)(b) or (c) who has been given the notice and any person entitled to receive a notice under paragraph (1)(d) whose interest is subordinate to that of the secured party.
and all obligations secured by such interests shall be deemed to have been performed for the purposes of sections 49 and 50.
61(5)A notice of a proposal under subsection (1) and a notice of objection under subsection (2) may be given in accordance with section 69 or, if the notice is to be given to a person who has registered a financing statement or a notice of judgment, by registered mail addressed to the address of that person that was registered as part of the financing statement or notice of judgment.
61(6)The secured party may require any person who has made an objection to the proposal to furnish proof of that person’s interest in the collateral and, unless the person furnishes the proof within ten days after the secured party’s request, the secured party may proceed as if no objection had been made by that person.
61(7)On application by a secured party, the Court may determine that an objection to the proposal of a secured party is ineffective because
(a) the person made the objection for a purpose other than the protection of an interest in the collateral or in the proceeds of a disposition of the collateral, or
(b) the market value of the collateral is less than the total amount owing to the secured party together with the estimated expenses recoverable under paragraph 59(3)(a).
61(8)If a secured party disposes of collateral to a purchaser for value and in good faith who takes possession of it, the purchaser acquires the collateral, whether or not the requirements of this section have been complied with by the secured party, free from
(a) the interest of the debtor and the secured party, and
(b) any interest subordinate to that of the debtor and the secured party,
and all obligations secured by the subordinate interests shall be deemed to have been performed for the purposes of sections 49 and 50.
61(9)Subsection (8) does not affect the rights of a person with a security interest that is deemed by section 74 to be registered under this Act if the person has not been given a notice under subsection (1).
2004, c.35, s.9
Right to retain collateral in satisfaction of debt
61(1)After default, the secured party may propose to take the collateral in satisfaction of the obligation secured by it and shall give notice of the proposal to
(a) the debtor or any other person who is known by the secured party to be an owner of the collateral,
(b) a creditor or person with a security interest in the collateral whose security interest is subordinate to that of the secured party and
(i) who has registered, before the notice of the proposal is given to the debtor, a financing statement that includes the name of the debtor or that includes the serial number of the collateral if the collateral is goods of a kind that are prescribed as serial numbered goods, or
(ii) whose security interest was perfected by possession when the secured party seized or repossessed the collateral,
(c) a judgment creditor whose interest in the collateral is subordinate to that of the secured party and who has registered, before the notice of the proposal is given to the debtor, a notice of judgment that includes the name of the debtor or that includes the serial number of the collateral if the collateral is goods of a kind that are prescribed as serial numbered goods, and
(d) any other person with an interest in the collateral who has given a written notice to the secured party of that person’s interest before the notice of the proposal is given to the debtor.
61(2)If the interest in the collateral of any person entitled to a notice under subsection (1) would be adversely affected by the secured party’s proposal, that person may give to the secured party a notice of objection within fifteen days after the notice under subsection (1) is given.
61(3)Subject to subsections (6) and (7), if a notice of objection is given under subsection (2), the secured party shall dispose of the collateral under section 59.
61(4)If no notice of objection is given under subsection (2), the secured party
(a) shall be deemed, on the expiry of the fifteen day period or periods referred to in subsection (2), to have irrevocably elected to take the collateral in satisfaction of the obligation secured by it, and
(b) is entitled to hold or dispose of the collateral free from all rights and interests of the debtor, any person entitled to receive a notice under paragraph (1)(b) or (c) who has been given the notice and any person entitled to receive a notice under paragraph (1)(d) whose interest is subordinate to that of the secured party.
and all obligations secured by such interests shall be deemed to have been performed for the purposes of sections 49 and 50.
61(5)A notice of a proposal under subsection (1) and a notice of objection under subsection (2) may be given in accordance with section 69 or, if the notice is to be given to a person who has registered a financing statement or a notice of judgment, by registered mail addressed to the address of that person that was registered as part of the financing statement or notice of judgment.
61(6)The secured party may require any person who has made an objection to the proposal to furnish proof of that person’s interest in the collateral and, unless the person furnishes the proof within ten days after the secured party’s request, the secured party may proceed as if no objection had been made by that person.
61(7)On application by a secured party, the Court may determine that an objection to the proposal of a secured party is ineffective because
(a) the person made the objection for a purpose other than the protection of an interest in the collateral or in the proceeds of a disposition of the collateral, or
(b) the market value of the collateral is less than the total amount owing to the secured party together with the estimated expenses recoverable under paragraph 59(3)(a).
61(8)If a secured party disposes of collateral to a purchaser for value and in good faith who takes possession of it, the purchaser acquires the collateral, whether or not the requirements of this section have been complied with by the secured party, free from
(a) the interest of the debtor and the secured party, and
(b) any interest subordinate to that of the debtor and the secured party,
and all obligations secured by the subordinate interests shall be deemed to have been performed for the purposes of sections 49 and 50.
61(9)Subsection (8) does not affect the rights of a person with a security interest that is deemed by section 74 to be registered under this Act if the person has not been given a notice under subsection (1).
2004, c.35, s.9