Personal Property Securities – If Applicable

What Are Personal Property Securities and How Do They Affect This Transaction?

The Personal Property Securities Act 2009 (Cth) (“PPSA”) applies to security interests in personal property, including goods and chattels, financial property, shares, and intellectual property (personal property).

PPSA doesn’t apply to land, buildings, or fixtures that form part of the land.

The PPSA may apply if, in addition to the land, personal property is sold to you which is not a fixture.  Title to that personal property must be transferred at settlement free from encumbrances.

What is Affected by the Personal Property Securities Act (PPSA)?

A chattel, good, or other personal property (other than crops) is considered to be a “Fixture” if it is affixed or annexed to the land in such a way as to become part of the land (taking into account the degree/ mode/ object of annexation).  Fixtures are not affected by the Personal Property Securities Act (PPSA).  All other goods will generally be considered chattels and may be affected by the PPSA.

For example:

• An air-conditioning unit, satellite dish, oven, rangehood, window furnishings, or carpets are usually fixtures and the PPSA may not apply.
• A clothes dryer, furniture package, fridge, or washing machine (if not affixed) are chattels to which the PPSA may apply.
• Items such as solar panels or water tanks/pumps may be considered a chattel depending on how these items are part of the property (e.g. if they are affixed, and if so, how).

When do I need a Specific Release?

If:

• Personal property is included in the sale; and
• A security interest is noted on the PPS register for that property; and
• None of the extinguishment rules apply,

then the Seller is required to obtain from the secured party either a letter or financing change statement, which releases the personal property and provides it at settlement.  If you are uncertain about the legal position of the chattels, we recommend you instruct us to request a specific release from the Seller.

To enable us to consider if any of the extinguishment rules apply, please provide your instructions on whether any personal property being sold as part of the property is worth less than $5,000, is subject to a security interest, and is being sold for “new value”.

Please tell us about any personal property included in the purchase so we can consider the impact of the PPSA on the transaction and protect your interests accordingly.

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