The Personal Property Security Act ("PPSA") is the name given to each of the statutes passed by all common law

Common law

Common law is law developed by judges through decisions of courts and similar tribunals rather than through legislative statutes or executive branch action...

 provinces, as well as the territories, of Canada. They regulate the creation and registration of security interest

Security interest

A security interest is a property interest created by agreement or by operation of law over assets to secure the performance of an obligation, usually the payment of a debt. It gives the beneficiary of the security interest certain preferential rights in the disposition of secured assets...

s in all personal property

Personal property

Personal property, roughly speaking, is private property that is moveable, as opposed to real property or real estate. In the common law systems personal property may also be called chattels or personalty. In the civil law systems personal property is often called movable property or movables - any...

 within their respective jurisdictions.

It is similar in structure to Article 9

Secured transactions in the United States

Secured transactions in the United States are an important part of the law and economy of the country. By enabling lenders to take a security interest in collateral , the law of secured transactions provides lenders with assurance of legal relief in case of default by the borrower...

 of the Uniform Commercial Code

Uniform Commercial Code

The Uniform Commercial Code , first published in 1952, is one of a number of uniform acts that have been promulgated in conjunction with efforts to harmonize the law of sales and other commercial transactions in all 50 states within the United States of America.The goal of harmonizing state law is...

 in the United States, but there are important differences.

PPSA regime

The legislation that implemented the PPSA scheme was first introduced in Ontario

Ontario

Ontario is a province of Canada, located in east-central Canada. It is Canada's most populous province and second largest in total area. It is home to the nation's most populous city, Toronto, and the nation's capital, Ottawa....

, followed by the remaining provinces and territories (which followed a newer uniform model with notable differences). The Atlantic provinces, together with the Northwest Territories

Northwest Territories

The Northwest Territories is a federal territory of Canada.Located in northern Canada, the territory borders Canada's two other territories, Yukon to the west and Nunavut to the east, and three provinces: British Columbia to the southwest, and Alberta and Saskatchewan to the south...

 and Nunavut

Nunavut

Nunavut is the largest and newest federal territory of Canada; it was separated officially from the Northwest Territories on April 1, 1999, via the Nunavut Act and the Nunavut Land Claims Agreement Act, though the actual boundaries had been established in 1993...

, have fully computerized registries, while the others have varying degrees of electronic and paper registration. The following is a brief outline of how the regime generally works.

Personal property subject to the Act

The scope of the Act is extremely broad, as it is concerned with every transaction which in substance creates a security interest, without regard to its form and without regard to the person who has title to the collateral. There are small differences between the provinces as to how far this extends, but the concept is basically the same. That said, however, there are some items that are specifically excluded:

• liens
• interests in annuities and insurance policies
• interests in land (other than interests arising under a license), including leases
• assignments for the general benefit of creditors
• interests in any compensation for labour or personal services

Personal property is classified into the following categories:

• goods (further classified into consumer goods, equipment and inventory)
• instruments
• documents of title
• chattel paper (including leases and conditional sales contracts)
• securities
• money
• intangibles (licenses and any other matter not included above)

Creation of security interests

Security interests are created through attachment, which can be followed on by perfection.

Attachment occurs when

• value is given,
• the debtor has rights in the collateral, and
• it is enforceable against third parties.

Perfection can occur by possession of the collateral, or by registration. In certain circumstances, possession can be considered to be the superior form of perfection.

Purchase money security interests (PMSIs)

A PMSI is a special type of security interest taken in collateral by a party who gives value for the purpose of enabling the debtor to acquire rights in the collateral. Some examples are:

Type of interest	Collateral
Loan to purchase goods	The goods
Sale of goods	The goods
Leases (terms > 1 year)	The leased asset
Consignment of goods	The goods

Creation of "super-priorities"

In specified circumstances, PPSA registrants can obtain "super-priority" status over other secured parties, when the following steps are taken:

Collateral	Steps to take
Inventory	Perfection at the time of possession, provided that notice has been given to other secured parties before registration (and possession by the debtor)
Intangibles	Perfection no later than the specified number of days after attachment
Other than the above	Perfection no later than the specified number of days after possession by the debtor

The PPSA and land

PPSA security interests can have priority over real property security interests against fixtures, when the secured party registers notice against the land at the local registry or land titles office. Where attachment occurs before the affixation to the land, the interest will have priority, However, where attachment occurs after affixation, the interest is subordinate unless where the debtor otherwise consents.

Other intersections can also occur with interests in land. For example, a lender that grants a mortgage over a rental property will also register a PPSA security interest against the rents being generated, in order to attorn

Attornment

Attornment , in English real property law, is the acknowledgment of a new lord by the tenant on the alienation of land. Under the feudal system, the relations of landlord and tenant were to a certain extent reciprocal...

 the rents in the event the mortgage goes into default.

Priorities of security interests

In the absence of any other special priority rules, the general order of priority is as follows:

Event	Priority given
Competing interests are perfected by registration	First interest to register
Competing interests are perfected other than by registration	First interest to perfect
One interest is perfected by registration, and the other interest other than by registration	Registered interest takes priority if registered and perfected before the other is perfected. Interest perfected other than by registration takes priority if it is perfected prior to the registration of the other interest.
Competing interests are both unperfected	First interest to attach
One interest is perfected, and the other is unperfected	Perfected interest

Regime under Québec legislation

For moveable property in Québec, secured creditors create their security interests by way of hypothec

Hypothec

Hypothec is a mortgage in Roman and Scots law, in other words, a legal right over a debtor's property that however remains in the debtor's possession....

 through the Registre des droits personnels et réels mobiliers.

Security interests created under Federal legislation

Federal legislation has also created certain security interests that may take precedence over provincial legislation. They notably include:

• Bank Act
  Canada Bank Act
  The Bank Act is an Act of the Government of Canada respecting banks and banking.The Act groups banks in three schedules. Schedule I banks are banks allowed to accept deposits that are not a subsidiary of a foreign bank, Schedule II banks are banks allowed to accept deposits that are a subsidiary...
  
   security for loans granted by banks
• interests in patent
  Patent
  A patent is a form of intellectual property. It consists of a set of exclusive rights granted by a sovereign state to an inventor or their assignee for a limited period of time in exchange for the public disclosure of an invention....
  
  s, copyright
  Copyright
  Copyright is a legal concept, enacted by most governments, giving the creator of an original work exclusive rights to it, usually for a limited time...
  
  s and trademark
  Trademark
  A trademark, trade mark, or trade-mark is a distinctive sign or indicator used by an individual, business organization, or other legal entity to identify that the products or services to consumers with which the trademark appears originate from a unique source, and to distinguish its products or...
  
  s
• interests in railway and rolling stock
• federal property
• matters relating to Indians and Indian lands
• deemed trusts under taxation laws
• priorities of claims under bankruptcy
  Bankruptcy
  Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
  
   and insolvency
  Insolvency
  Insolvency means the inability to pay one's debts as they fall due. Usually used to refer to a business, insolvency refers to the inability of a company to pay off its debts.Business insolvency is defined in two different ways:...
  
   laws

There can also be complex interplay with security interests under admiralty law

Admiralty law

Admiralty law is a distinct body of law which governs maritime questions and offenses. It is a body of both domestic law governing maritime activities, and private international law governing the relationships between private entities which operate vessels on the oceans...

.

Resources by province

Province	PPSA Citation	Provincial registry or agent
British Columbia	RSBC 1996, c. 359	BC Registry Services
Alberta	RSA 2000, c. P‑7	Service Alberta Registries Online (registration through agents only)
Saskatchewan	SS 1993, c. P-6.2	Information Services Corporation
Manitoba	CCSM c. P35	The Property Registry of Manitoba
Ontario	RSO 1990, c. P.10	Service Ontario
New Brunswick	SNB 1993, c. P-7.1	ACOL (electronic service only)
Nova Scotia	SNS 1995-96, c. 13	ACOL (electronic service only)
Prince Edward Island	SPEI 1997, c.33, also referred to as c. P-3.1	ACOL (electronic service only)
Newfoundland and Labrador	SNL 1998, c. P-7.1	ACOL (electronic service only)
Yukon	RSY 2002, c. 169	Yukon Personal Property Security Registry (paper registration only, otherwise electronic)
Northwest Territories	SNWT 1998, c.8	ACOL (electronic service only)
Nunavut	As NWT	ACOL (electronic service only)

Documents

• John R. Sandrelli, Christopher J. Ramsay and Anjili I. Bahadoorsingh,Remedies under Security Interests in Canada: An Overview (2002-09-18)
• Roderick J.Wood,The Concept of a Security Interest: The Canadian Experience (2011-08-18)