This electronic version is for your own personal use and may not be copied for purposes of resale in this or any other form.
 
BILL NO. 31

                                              Government Bill

                 
                                                               
              3rd Session, 56th General Assembly
                         Nova Scotia
                    44 Elizabeth II, 1995

                 
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                      An Act Respecting
           Security Interests in Personal Property










                 
                                                               
                                                               
                The Honourable Sandra L. Jolly
                Minister of Municipal Affairs


                 
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                               
                                                             
                 
                                                               
                           Halifax
         Printed by Queen''s Printer for Nova Scotia
                               
                               
                               
                       An Act Respecting
            Security Interests in Personal Property



         Be it enacted by the Governor and Assembly as follows:


         1  This Act may be cited as the Personal Property Security Act.


                            PART I

                INTERPRETATION AND APPLICATION

         2    In this Act,

                (a) "accession" means goods that are installed in or affixed to other goods;

                (b) "account" means a monetary obligation not evidenced by chattel paper,
            a security or an instrument, whether or not the obligation has been earned by
            performance;

                (c) "advance" means the payment of money, the provision of credit or the
            giving of value and includes any liability of the debtor to pay interest, credit costs
            and other charges payable by the debtor in connection with an advance or the
            enforcement of a security interest securing the advance;

                (d) "building" means a structure, erection, mine or work built, constructed
            or opened on or in land;

                (e) "building materials" means materials that are incorporated into a
            building and includes goods attached to a building so that their removal

                    (i) would necessarily involve the dislocation or destruction of some
                other part of the building and cause substantial damage to the building, apart
                from the loss of value of the building resulting from the removal, or

                    (ii)    would result in weakening the structure of the building or
                exposing the building to weather damage or deterioration,

            but does not include

                    (iii)   heating, air conditioning or conveyancing devices, or

                    (iv)    machinery installed in a building or on land for use in carrying
                on an activity in the building or on the land;

                (f) "chattel paper" means one or more writings that evidence both a
            monetary obligation and a security interest in, or a lease of, specific goods or
            specific goods and accessions;

                (g) "collateral" means personal property that is subject to a security
            interest;

                (h) "commercial consignment" means a consignment under which goods
            are delivered for sale, lease or other disposition to a consignee who, in the ordinary
            course of the consignee's business, deals in goods of that description, by a
            consignor who

                    (i) in the ordinary course of the consignor's business, deals in
                goods of that description, and

                    (ii)    reserves an interest in the goods after they have been delivered,

            but does not include an agreement under which goods are delivered to

                    (iii)   an auctioneer for sale, or

                    (iv)    a consignee for sale, lease or other disposition if the consignee
                is generally known to the creditors of the consignee to be selling or leasing
                goods of others;

                (i) "consumer goods" means goods that are used or acquired for use
            primarily for personal, family or household purposes;

                (j) "Court" means the Supreme Court of Nova Scotia;

                (k) "creditor" includes an assignee for the benefit of creditors, an executor,
            an administrator or a committee of a creditor;

                (l) "crops" means crops, whether or not matured, and whether naturally
            grown or planted, attached to land by roots or forming part of trees or plants
            attached to land, and includes trees only if they are

                    (i) being grown as nursery stock,

                    (ii)    being grown for uses other than for the production of lumber and
                wood products, or

                    (iii)   intended to be replanted in another location for the purpose of
                reforestation;

                (m) "debtor" means

                    (i) a person who owes payment or performance of an obligation
                secured, whether or not that person owns or has rights in the collateral,

                    (ii)    a person who receives goods from another person under a
                commercial consignment,

                    (iii)   a lessee under a lease for a term of more than one year,

                    (iv)    a transferor of an account or chattel paper,

                    (v) a seller under a sale of goods without a change of possession,

                    (vi)    in Sections 18, 25, 27 and 59, subsections  60(15) and 62(8) and
                Section 67, the transferee of a debtor's interest in the collateral, and

                    (vii)   if the person referred to in subclause (i) and the owner of the
                collateral are not the same person,

                        (A) where "debtor" is used in a provision dealing with the
                    collateral, an owner of the collateral,

                        (B) where "debtor" is used in a provision dealing with the
                    obligation, the obligor, and

                        (C) where the context permits, both the owner and the obligor;

                (n) "default" means

                    (i) the failure to pay or otherwise perform the obligation secured
                when due, or

                    (ii)    the occurrence of any event or set of circumstances whereupon,
                under the terms of the security agreement, the security interest becomes
                enforceable;

                (o) "document of title" means a writing issued by or addressed to a bailee

                    (i) that covers goods in the bailee's possession that are identified
                or that are fungible portions of an identified mass, and

                    (ii)    in which it is stated that the goods covered by it will be delivered
                to a named person, or to the transferee of that person, or to bearer or to the
                order of a named person;

                (p) "equipment" means goods that are held by a debtor other than as
            inventory or consumer goods;

                (q) "financing change statement" means the data authorized by the
            regulations to be entered in the Registry to renew, discharge or otherwise amend
            a financing statement;

                (r) "financing statement" means the data authorized by the regulations to
            be entered in the Registry to effect a registration for the purpose of perfecting a
            security interest in collateral pursuant to this Act and, where the context permits,
            includes

                    (i) a financing change statement, and

                    (ii)    a security agreement registered pursuant to the Assignment of
                Book Debts Act, the Bills of Sale Act, the Conditional Sales Act or the
                Corporations Securities Registration Act before the coming into force of this
                Act, together with any writing that was registered with the agreement or
                registered to rectify, amend or renew the agreement;

                (s) "fixture" does not include building materials;

                (t) "future advance" means an advance, whether or not made pursuant to
            an obligation and includes advances and reasonable costs incurred and
            expenditures made for the protection, maintenance, preservation or repair of the
            collateral;

                (u) "goods" means tangible personal property, fixtures, crops and the
            unborn young of animals but does not include a document of title, chattel paper, a
            security, an instrument, money or trees, other than crops, until they are severed or
            minerals until they are extracted;

                (v) "instrument" means

                    (i) a bill of exchange, note or cheque within the meaning of the Bills
                of Exchange Act (Canada),

                    (ii)    any other writing that evidences a right to payment of money and
                is of a type that in the ordinary course of business is transferred by delivery
                with any necessary endorsement or assignment, or

                    (iii)   a letter of credit or an advice of credit if the letter or advice
                states that it must be surrendered on claiming payment under it,

            but does not include

                    (iv)    a document of title, chattel paper or a security, or

                    (v) a writing that provides for or creates a mortgage or charge in
                respect of an interest in land that is specifically identified in the writing;

                (w) "intangible" means personal property that is not goods, a document of
            title, chattel paper, a security, an instrument or money;

                (x) "inventory" means goods that are

                    (i) held by a person for sale or lease, or that have been leased by
                that person as lessor,

                    (ii)    to be furnished or that have been furnished under a contract of
                service,

                    (iii)   raw materials or work in progress, or

                    (iv)    materials used or consumed in a business or profession;

                (y) "lease for a term of more than one year" includes

                    (i) a lease of goods for an indefinite term including a lease for an
                indefinite term that is determinable by one or both parties within one year
                after its execution,

                    (ii)    a lease of goods initially for a term of one year or less if the
                lessee, with the consent of the lessor, retains uninterrupted or substantially
                uninterrupted possession of the leased goods for more than one year after the
                lessee, with the consent of the lessor, first acquired possession of the goods,
                but the lease does not become a lease for a term of more than one year until
                the lessee's possession extends beyond one year, and

                    (iii)   a lease of goods for a term of one year or less where the lease
                provides that it is renewable for one or more terms automatically or at the
                option of one of the parties or by agreement of the parties if the total terms,
                including the original term, may exceed one year,

            but does not include

                    (iv)    a lease of goods by a lessor who is not regularly engaged in the
                business of leasing goods,

                    (v) a lease of household furnishings or appliances as part of a lease
                of land where the goods are incidental to the use and enjoyment of the land,
                or

                    (vi)    a lease of goods of a prescribed kind, regardless of the length of
                the term of the lease;

                (z) "minerals" includes oil, gas and hydrocarbons;

                (aa)    "money" means a medium of exchange authorized by the Parliament
            of Canada as part of the currency of Canada or authorized or adopted by a foreign
            government as part of its currency;

                (ab)    "obligation secured" means, for the purpose of determining the amount
            payable under a lease that secures payment or performance of an obligation,

                    (i) the amount originally contracted to be paid as rent under the
                lease,

                    (ii)    any other amount payable under the terms of the lease, or

                    (iii)   the amount, if any, required to be paid by the lessee to obtain
                ownership of the collateral,

            less any amount paid before the determination;

                (ac)    "pawnbroker" means a person who engages in the business of granting
            credit to individuals for personal, family or household purposes and who

                    (i) takes and perfects security interests in consumer goods by taking
                possession of them, or

                    (ii)    purchases consumer goods under agreements or undertakings,
                express or implied, that the goods may be repurchased by the sellers;

                (ad)    "personal property" means goods, a document of title, chattel paper,
            a security, an instrument, money or an intangible;

                (ae)    "prescribed" means prescribed by or pursuant to the regulations;

                (af)    "prior security interest" means an interest created by or provided for
            under a valid security agreement or other transaction entered into before the
            coming into force of this Act that is a security interest within the meaning of this Act
            and to which this Act would have applied if it had been in force when the security
            agreement or other transaction was entered into;

                (ag)    "proceeds" means

                    (i) identifiable or traceable personal property that is derived directly
                or indirectly from any dealing with collateral or proceeds of collateral and
                in which the debtor acquires an interest,

                    (ii)    an insurance or other payment that represents indemnity or
                compensation for loss of or damage to collateral or proceeds of collateral,
                or a right to such a payment, or

                    (iii)   a payment made in total or partial discharge or redemption of
                chattel paper, a security, an instrument or an intangible;

                (ah)    "purchase" means taking by sale, lease, discount, assignment,
            negotiation, mortgage, pledge, lien, issue, reissue, gift or any other consensual
            transaction creating an interest in property;

                (ai)    "purchase money security interest" means

                    (i) a security interest taken in collateral to the extent that it secures
                all or part of the purchase price of the collateral,

                    (ii)    a security interest taken in collateral by a person who gives value
                for the purpose of enabling the debtor to acquire rights in the collateral, to
                the extent that the value is applied to acquire the rights,

                    (iii)   the interest of a lessor of goods under a lease for a term of more
                than one year, or

                    (iv)    the interest of a consignor who delivers goods to a consignee
                under a commercial consignment,

            but does not include a transaction of sale by and lease back to the seller, and for the
            purpose of this definition, "purchase price" and "value" include interest, credit
            costs and other charges payable for the purchase or loan credit;

                (aj)    "receiver" includes a receiver-manager;

                (ak)    "Registrar" means the Registrar of the Personal Property Registry
            appointed pursuant to this Act;

                (al)    "Registry" means the Personal Property Registry established by this
            Act;

                (am)    "registry of deeds" means the office of a registrar of deeds appointed
            pursuant to the Registry Act;

                (an)    "sale of goods without a change of possession" means a sale of goods
            that is not accompanied by an immediate delivery and an actual, apparent and
            continued change of possession of the goods sold, but does not include a sale of
            goods in the ordinary course of business of the seller, and for the purpose of this
            definition, "sale" includes an assignment, transfer, conveyance, declaration of trust
            or any other agreement or transaction, not intended to secure payment or
            performance of an obligation, by which an interest in goods is conferred;

                (ao)    "secured party" means

                    (i) a person who has a security interest,

                    (ii)    a person who holds a security interest for the benefit of another
                person, or

                    (iii)   a trustee, if a security interest is embodied in a trust indenture;

                (ap)    "security" means a writing, whether or not in the form of a security
            certificate, that

                    (i) is recognized in the jurisdiction in which it is issued or dealt with
                as evidencing a share, participation or other interest in property or an
                enterprise, or that evidences an obligation of the issuer,

                    (ii)    is one of a class or series or, by its terms, is divisable into
                classes or series of writings, and

                    (iii)   in the ordinary course of business is transferred by

                        (A) delivery with the necessary endorsement, assignment or
                    registration in the records of the issuer or of an agent of the issuer, or
                    compliance with restrictions on transfer, or

                        (B) an entry in the records of a clearing agency,

            but does not include a writing that provides for or creates a mortgage or charge in
            respect of an interest in land that is specifically identified in the writing;

                (aq)    "security agreement" means an agreement that creates or provides for
            a security interest and, where the context permits, includes

                    (i) an agreement that creates or provides for a prior security
                interest, and

                    (ii)    a writing that evidences a security agreement;

                (ar)    "security interest" means

                    (i) an interest in personal property that secures payment or
                performance of an obligation, but does not include the interest of a seller who
                has shipped goods to a buyer under a negotiable bill of lading or its
                equivalent to the order of the seller or to the order of an agent of the seller,
                unless the parties have otherwise evidenced an intention to create or provide
                for a security interest in the goods, and

                    (ii)    the interest of

                        (A) a consignor who delivers goods to a consignee under a
                    commercial consignment,

                        (B) a lessor under a lease for a term of more than one year,

                        (C) a transferee under a transfer of an account or a transfer
                    of chattel paper, or

                        (D) a buyer under a sale of goods without a change of
                    possession,

                that does not secure payment or performance of an obligation;

                (as)    "security with a clearing agency" means a security

                    (i) in the form of a security certificate

                        (A) in bearer form,

                        (B) endorsed in blank by an appropriate person, or

                        (C) registered in the name of the clearing agency or its
                    nominee or custodian,

                that is in the custody of the clearing agency, or

                    (ii)    not in the form of a security certificate and that is registered or
                recorded in the records maintained by or on behalf of the issuer in the name
                of a clearing agency or its nominee or custodian;

                (at)    "specific goods" means goods identified and agreed on at the time a
            security agreement in respect of those goods is made;

                (au)    "trust indenture" means a deed, indenture or document, however
            designated, by the terms of which a person issues or guarantees or provides for the
            issue or guarantee of debt obligations secured by a security interest and in which
            another person is appointed as trustee for the holders of the debt obligations issued,
            guaranteed or provided for under it;

                (av)    "value" means any consideration sufficient to support a simple contract
            and includes an antecedent debt or liability, and "new value" means value other
            than an antecedent debt or liability.


         3  (1) For the purpose of this Act,

                (a) a natural person knows or has knowledge when information is acquired
            by that person under circumstances in which a reasonable person would take
            cognizance of it;

                (b) a partnership knows or has knowledge when information has come to
            the attention of one of the general partners or a person having control or
            management of the partnership business under circumstances in which a reasonable
            person would take cognizance of it;

                (c) a body corporate knows or has knowledge when information, in
            writing, has been delivered to the body corporate's registered office or recognized
            agent appointed by the body corporate in accordance with the Corporations
            Registration Act or the Societies Act, or when information has come to the attention
            of

                    (i) a managing director or officer of the body corporate, or

                    (ii)    a senior employee of the body corporate with responsibility for
                matters to which the information relates,

            under circumstances in which a reasonable person would take cognizance of it;

                (d) the members of an association know or have knowledge when
            information has come to the attention of

                    (i) a managing director or officer of the association,

                    (ii)    a senior employee of the association with responsibility for
                matters to which the information relates, or

                    (iii)   all members,

            under circumstances in which a reasonable person would take cognizance of it; and

                (e) a government knows or has knowledge when information has come to
            the attention of a senior employee of the government with responsibility for matters
            to which the information relates under circumstances in which a reasonable person
            would take cognizance of it.

            (2) Except as otherwise provided in this Act, the determination as to whether
goods are "consumer goods", "inventory" or "equipment" shall be made as of the time the
security interest attaches.

            (3) Proceeds are traceable whether or not there is a fiduciary relationship
between the person who has a security interest in the proceeds as provided in Section 29 and the
person who has rights in or has dealt with the proceeds.

            (4) Where collateral is a security with a clearing agency, the transferee or
secured party is deemed to have taken possession of the security when the appropriate entries
have been made in the records of the clearing agency.

            (5) This Act is to be interpreted and applied, in so far as the context permits, in
a manner that promotes the inter-jurisdictional harmony of the law of personal property security
in Canada.

            (6) This Act binds Her Majesty in right of the Province.


         4  (1) Subject to Section 5, this Act applies to

                (a) every transaction that in substance creates a security interest, without
            regard to its form and without regard to the person who has title to the collateral;
            and

                (b) without limiting the generality of clause (a), a chattel mortgage,
            conditional sale, fixed charge, floating charge, pledge, trust indenture, trust receipt,
            assignment, consignment, lease, trust or transfer of chattel paper where it secures
            payment or performance of an obligation.

            (2) Subject to Sections 5 and 56, this Act applies to

                (a) a commercial consignment;

                (b) a lease for a term of more than one year;

                (c) a transfer of an account or chattel paper; and

                (d) a sale of goods without a change of possession,

that does not secure payment or performance of an obligation.


         5  Except as otherwise provided in this Act, this Act does not apply to

            (a) a lien, charge or other interest given by a statute or rule of law unless the
         statute provides that this Act applies;

            (b) the creation or transfer of an interest or claim in or under a contract of
         annuity or policy of insurance except the transfer of a right to money or other value
         payable under a policy of insurance as indemnity or compensation for loss of or damage
         to collateral;

            (c) the creation or transfer of an interest in present or future wages, salary, pay,
         commission or any other compensation for work or services, the assignment or transfer
         of which is prohibited by any statute or rule of law;

            (d) the transfer of an unearned right to payment under a contract to a transferee
         who is to perform the transferor's obligations under the contract;

            (e) the creation or transfer of an interest in land including a lease;

            (f) the creation or transfer of an interest in a right to payment that arises in
         connection with an interest in or a lease of land other than an interest in a right to
         payment evidenced by a security or an instrument;

            (g) a sale of accounts, chattel paper or goods as part of a sale of the business out
         of which they arose unless the vendor remains in apparent control of the business after the
         sale;

            (h) a transfer of accounts made solely to facilitate the collection of accounts for
         the transferor;

            (i) the creation or transfer of a right to damages in tort;

            (j) a mortgage or sale registered pursuant to the Canada Shipping Act
         (Canada);

            (k) a security agreement governed by an Act of the Parliament of Canada that
         deals with the rights of parties to the agreement or the rights of third parties affected by
         a security interest created by the agreement, including any security agreement governed
         by Part VIII of the Bank Act (Canada).


         6  (1) Subject to this Act, the validity, perfection and effect of perfection or non-perfection
of

                (a) a security interest in goods; and

                (b) a possessory security interest in a negotiable document of title, chattel
            paper, a security, an instrument and money,

are governed by the law of the jurisdiction where the collateral is situated when the security
interest attaches.

            (2) For the purpose of subsection (1), a security with a clearing agency is situated
where the records of the clearing agency are kept.

            (3) A security interest in goods perfected pursuant to the law of the jurisdiction
in which the goods are situated, at the time the security interest attaches but before the goods are
brought into the Province, continues perfected in the Province if it is perfected in the Province

                (a) not later than sixty days after the goods are brought into the Province;

                (b) not later than fifteen days after the secured party has knowledge that
            the goods have been brought into the Province; or

                (c) before perfection ceases under the law of the jurisdiction in which the
            goods were situated when the security interest attached,

whichever is earliest.

            (4) Notwithstanding subsection (3), a security interest in goods referred to in that
subsection is subordinate to the interest of a buyer or lessee of the goods who acquires the
interest without knowledge of the security interest and before it is perfected in the Province
pursuant to Section 25 or 26.

            (5) A security interest that is not perfected in accordance with subsection (3) may
be otherwise perfected in the Province pursuant to this Act.

            (6) Where a security interest referred to in subsection (1) is not perfected
pursuant to the law of the jurisdiction in which the collateral was situated when the security
interest attached and before the collateral was brought into the Province, it may be perfected
pursuant to this Act.


         7  (1) Subject to Section 8, where the parties to a security agreement that creates
a security interest in goods in one jurisdiction understand when the security interest attaches that
the goods will be kept in another jurisdiction, the validity, perfection and effect of perfection or
non-perfection of the security interest are determined by the law of the other jurisdiction if the
goods are removed to the other jurisdiction, for purposes other than transportation through the
other jurisdiction, within thirty days after the security interest attaches.

            (2) Where the other jurisdiction referred to in subsection (1) is not the Province
and the goods are later brought into the Province, the security interest in the goods is deemed
to be a security interest to which subsection 6(3) applies if it was perfected pursuant to the law
of the other jurisdiction to which the goods were removed.


         8  (1) For the purpose of this Section, a debtor is located

                (a) at the place of business of the debtor, if any;

                (b) at the chief executive office of the debtor, if the debtor has more than
            one place of business; and

                (c) at the principal residence of the debtor, if the debtor has no place of
            business.

            (2) The validity, perfection and effect of perfection or non-perfection of

                (a) a security interest in an intangible;

                (b) a security interest in goods that are of a type that are normally used in
            more than one jurisdiction, if the goods are equipment or are inventory leased or
            held for lease by the debtor to others; and

                (c) a non-possessory security interest in a negotiable document of title,
            chattel paper, a security, an instrument or money,

are governed by the law, including the conflict of law rules, of the jurisdiction where the debtor
is located when the security interest attaches.

            (3) Where a debtor relocates to another jurisdiction or transfers an interest in the
collateral to a person located in another jurisdiction, a security interest perfected pursuant to
the law that is applicable under subsection (2) continues perfected in the Province if it is
perfected in the other jurisdiction

                (a) not later than sixty days after the debtor relocates or transfers an
            interest in the collateral to a person located in the other jurisdiction;

                (b) not later than fifteen days after the secured party has knowledge that
            the debtor has relocated or transferred an interest in the collateral to a person
            located in the other jurisdiction; or

                (c) before perfection ceases under the law of the first jurisdiction,

whichever is earliest.

            (4) Where the law governing the perfection of a security interest under subsection
(2) or (3) does not provide for public registration or recording of the security interest or of a
notice relating to it, and where the collateral is not in the possession of the secured party, the
security interest is subordinate to

                (a) an interest in an account payable in the Province; and

                (b) an interest in goods, a negotiable document of title, chattel paper, a
            security, an instrument, or money if the interest was acquired when the collateral
            was situated in the Province,

unless the security interest is perfected pursuant to this Act before the interest referred to in
clause (a) or (b) arises.

            (5) A security interest referred to in subsection (4) may be perfected pursuant to
this Act.

            (6) Notwithstanding Section 7 and subsection (2), the validity, perfection and
effect of perfection or non-perfection of a security interest in minerals or in an account resulting
from the sale of the minerals at the minehead or wellhead that

                (a) is provided for in a security agreement executed before the minerals
            are extracted; and

                (b) attaches to the minerals on extraction or attaches to an account on sale
            of the minerals,

are governed by the law of the jurisdiction in which the minehead or wellhead is located.


         9  (1) Notwithstanding Sections 6, 7 and 8,

                (a) procedural issues that relate to the enforcement of the rights of a
            secured party against collateral, other than intangibles, are governed by the law of
            the jurisdiction in which the collateral is located when the rights are exercised;

                (b) procedural issues that relate to the enforcement of the rights of a
            secured party against intangibles are governed by the law of the forum; and

                (c) substantive issues that relate to the enforcement of the rights of a
            secured party against collateral are governed by the proper law of the contract
            between the secured party and debtor.

            (2) For the purpose of Sections 6, 7 and 8, a security interest shall be deemed to
be perfected pursuant to the law of a jurisdiction if

                (a) the secured party has complied with the law of that jurisdiction relating
            to the creation and continuance of a security interest; and

                (b) the security interest has a status under the law of that jurisdiction in
            relation to the interests of other secured parties, buyers, creditors of the debtor and
            a trustee in bankruptcy of the debtor similar to the status of an equivalent security
            interest created and perfected pursuant to this Act.


                           PART II

                VALIDITY OF SECURITY AGREEMENT
                    AND RIGHTS OF PARTIES

         10 Except as otherwise provided in this or any other Act, a security agreement is
effective according to its terms.


         11 (1) A security interest is enforceable against a third party only where

                (a) the collateral is in the possession of the secured party or another
            person on the secured party's behalf; or

                (b) the debtor has signed a security agreement that contains

                    (i) a description of the collateral by item or kind, or by reference to
                one or more of the following:  "goods", "document of title", "chattel paper",
                "security", "instrument", "money" or "intangible",

                    (ii)    a statement that a security interest is taken in all of the debtor's
                present and after-acquired personal property, or

                    (iii)   a statement that a security interest is taken in all of the debtor's
                present and after-acquired personal property except specified items or kinds
                of personal property or except one or more of the following:  "goods",
                "document of title", "chattel paper", "security", "instrument", "money" or
                "intangible".

            (2) A secured party does not have possession of collateral for the purpose of
clause (1)(a) if the collateral is in the apparent possession or control of the debtor or the
debtor's agent.

            (3) A description is inadequate for the purpose of subclause (1)(b)(i) if it
describes the collateral as consumer goods or equipment without further describing the item or
kind of collateral but, where the personal property to be excluded from a description of collateral
under subclause (1)(b)(iii) is the consumer goods of the debtor, the excluded property may be
described simply as consumer goods.

            (4) A description of collateral as inventory is adequate for the purpose of clause
(1)(b) only while it is held by the debtor as inventory.

            (5) A security interest in proceeds is enforceable against a third party, whether
or not the security agreement contains a description of the proceeds.


         12 Where a security agreement is in writing, the secured party shall deliver a copy of
the security agreement to the debtor within ten days after its execution and, if the secured party
fails to do so after a request by the debtor, the Court may, on application by the debtor, order
the delivery of the copy to the debtor.


         13 (1) A security interest, including a security interest in the nature of a floating
charge, attaches when

                (a) value is given;

                (b) the debtor has rights in the collateral; and

                (c) except for the purpose of enforcing rights as between the parties to the
            security agreement, the security interest becomes enforceable within the meaning
            of Section 11.

            (2) Notwithstanding subsection (1), where the parties have specifically agreed to
postpone the time of attachment, the security interest attaches at the agreed time.

            (3) For the purpose of clause (1)(b) and without limiting other rights, if any, that
the debtor has in the goods, a lessee under a lease for a term of more than one year or a
consignee under a commercial consignment has rights in the goods when the lessee or consignee
obtains possession of them under the lease or consignment.

            (4) For the purpose of clause (1)(b), a debtor has no rights in

                (a) crops until they become growing crops;

                (b) the young of animals until they are conceived;

                (c) minerals until they are extracted; or

                (d) trees, other than crops, until they are severed.


         14 (1) Subject to Section 13 and subsection (2), a security agreement that provides
for a security interest in after-acquired personal property attaches to that property in
accordance with the terms of the agreement without any need for specific appropriation by the
debtor.

            (2) A security interest does not attach under an after-acquired property clause
in a security agreement to after-acquired personal property that is

                (a) crops that become growing crops more than one year after the security
            agreement has been entered into, except that a security interest in crops that is
            given in conjunction with a lease, agreement for sale or mortgage of land may
            attach, if the parties agree, to crops to be grown on the land concerned during the
            term of the lease, agreement for sale or mortgage; or

                (b) consumer goods, other than an accession, unless the security interest
            is a purchase money security interest or a security interest in collateral obtained by
            the debtor as replacement for collateral described in the security agreement.


         15 (1) A security agreement may secure future advances.

            (2) Unless otherwise agreed, an obligation owing to a debtor to make future
advances is not binding on a secured party if

                (a) a notice of judgment against the debtor has been registered in the
            Registry;

                (b) the collateral in which the secured party has a security interest includes
            non-exempt exigible personal property or attachable debts of the debtor within the
            meaning of the Creditors' Relief Act; and

                (c) the secured party has knowledge of the registration of the notice of
            judgment before making the advances.


         16 Where a seller has a purchase money security interest in goods, the law relating to
contracts of sale governs the sale and the seller's performance obligations with respect to the
goods, including any disclaimer, limitation or modification of those obligations.


         17 Where a security agreement provides that a secured party may accelerate payment
or performance when the secured party considers that the collateral is in jeopardy or that the
secured party is insecure, the security agreement shall be construed to mean that the secured
party has the right to do so only if the secured party in good faith believes and has commercially
reasonable grounds to believe that the prospect of payment or performance is or is about to be
impaired or that the collateral is or is about to be placed in jeopardy.


         18 (1) In this Section, "secured party" includes a receiver.

            (2) A secured party shall use reasonable care in the custody and preservation of
collateral in the secured party's possession and, unless otherwise agreed, in the case of chattel
paper, a security or an instrument, reasonable care includes taking necessary steps to preserve
rights against other persons.

            (3) Unless otherwise agreed, where collateral is in the secured party's
possession,

                (a) reasonable expenses, including the cost of insurance and payment of
            taxes or other charges incurred in obtaining and maintaining possession of the
            collateral and in its preservation are chargeable to the debtor and are secured by
            the collateral;

                (b) the risk of loss or damage, except if caused by the negligence of the
            secured party, is on the debtor to the extent of any deficiency in any insurance
            coverage;

                (c) the secured party may hold as additional security any increase or
            profits, except money, resulting from the collateral;

                (d) the secured party shall apply any increase or profits in the form of
            money resulting from the collateral, unless remitted to the debtor, immediately on
            its receipt in reduction of the obligation secured; and

                (e) the secured party shall keep the collateral identifiable, but fungible
            collateral may be commingled.

            (4) Subject to subsection (2), a secured party may use the collateral

                (a) in the manner and to the extent provided in the security agreement;

                (b) for the purpose of preserving the collateral or its value; or

                (c) in accordance with an order of the Court.


         19 (1) The debtor, a creditor, a sheriff, a person with an interest in personal
property of the debtor or an authorized representative of any of them may require a secured
party, by a demand in writing, to send or make available the information or documentation
referred to in subsection (3) to the person making the demand or, if the demand is made by the
debtor, to any person at an address specified by the debtor.

            (2) A demand made pursuant to subsection (1) shall contain an address for reply
and may be delivered to the secured party

                (a) at the most recent address of the secured party that was registered as
            part of a financing statement that includes a description of personal property of the
            debtor; or

                (b) at a more recent address that is the current address of the secured
            party if known by the person making the demand.

            (3) Any or all of the following may be demanded pursuant to subsection (1):

                (a) a copy of any security agreement providing for a security interest held
            by the secured party in the personal property of the debtor;

                (b) a statement in writing of the amount of the indebtedness and of the
            terms of payment of the indebtedness, as of the date specified in the demand;

                (c) a written approval or correction of an itemized list of personal property
            attached to the demand indicating which items are collateral as of the date specified
            in the demand;

                (d) a written approval or correction of the amount of indebtedness and of
            the terms of payment of the indebtedness, as of the date specified in the demand;

                (e) sufficient information as to the location of the security agreement or a
            copy of it within the Province to enable a person entitled to receive a copy of the
            security agreement to inspect it within the Province.

            (4) A person with an interest in personal property of the debtor may make a
demand pursuant to subsection (1) only with respect to a security agreement providing for a
security interest in the personal property in which the person has an interest.

            (5) The secured party, on the demand of a person entitled to receive a copy of the
security agreement referred to in clause (3)(a), shall permit the person to inspect the security
agreement or a copy of it during regular business hours at the location referred to in clause
(3)(e).

            (6) Where a person makes a demand pursuant to subsection (1) for a written
approval or correction of an itemized list referred to in clause (3)(c) and the secured party
claims a security interest in all of the debtor's present and after-acquired personal property, in
all of the debtor's present and after-acquired personal property except specified items or kinds
of personal property or in all of a specified kind of the debtor's personal property, the secured
party may indicate this instead of approving or correcting the itemized list.


         (7)    A secured party shall comply with a demand made pursuant to subsection (1) or (5)
within

                (a) twenty-five days after the demand is made, if the secured party is a
            trustee under a trust indenture; or

                (b) ten days after the demand is made, in the case of any other secured
            party.

            (8) Where, without reasonable excuse, the secured party fails to comply with a
demand made pursuant to subsection (1) or (5) within the time specified in subsection (7) or
provides an incomplete or incorrect reply to a demand made pursuant to subsection (1), the
person making the demand, in addition to any other remedy provided by this Act, may apply to
the Court for an order requiring the secured party to comply with the demand.

            (9) Where a person receiving a demand made pursuant to subsection (1) or (5)
no longer has an interest in the obligation or property of the debtor that is the subject of the
demand, that person shall, within fifteen days after receiving the demand, disclose the name and
address of the immediate successor in interest and, if known, the latest successor in interest.

            (10)    Where, without reasonable excuse, the person receiving the demand fails to
comply with subsection (9), the person making the demand, in addition to any other remedy
provided in this Act, may apply to the Court for an order requiring the person receiving the
demand to comply.

            (11)    On an application pursuant to subsection (8) or (10), the Court may make an
order requiring the secured party or the person receiving the demand to comply with the demand
or to disclose the information.

            (12)    On an application pursuant to subsection (8) or (10) or on a separate
application, the Court may make

                (a) any order that it considers necessary to ensure compliance with the
            demand;

                (b) an order that, in the event of non-compliance with an order made on
            an application pursuant to subsection (8), the security interest of the secured party
            in relation to which the demand was made is unperfected or extinguished and the
            person making the demand may register a financing change statement discharging
            any registration related to that security interest.

            (13)    On an application pursuant to subsection (8) or (10), or on an application by
the secured party referred to in subsection (8) or by the person receiving a demand referred to
in subsection (9), the Court, subject to Section 67, may make

                (a) an order exempting the secured party or person receiving the demand,
            in whole or in part, from complying with subsection (7) or (9), unless the demand
            is made by the debtor; or

                (b) an order extending the time for compliance.

            (14)    Where a secured party replies to a demand made pursuant to subsection (1),
the secured party and a successor in interest referred to in subsection (9) are estopped, for the
purpose of this Act, as against the person making the demand, and any other person who can
reasonably be expected to rely on the reply to the extent that the person relied on the reply, from
denying

                (a) the accuracy of any of the information referred to in clause (3)(b), (c)
            or (d) that is contained in the reply; or

                (b) that the copy of the security agreement referred to in clause (3)(a) that
            is provided with the reply is a true copy of that security agreement.

            (15)    A successor in interest referred to in subsection (9) is not estopped pursuant
to subsection (14) if

                (a) the person making the demand knows the identity and address of the
            successor in interest; or

                (b) before the demand, a financing change statement has been registered
            pursuant to Section 46 disclosing the successor in interest as the secured party.

            (16)    The person to whom a demand is made pursuant to this Section may require
payment in advance of a fee in the amount prescribed for each demand, but the debtor is entitled
to a reply without charge once every six months.

            (17)    A secured party who receives a demand that purports to be made by a person
entitled to make the demand pursuant to subsection (1) may act as if the person is entitled to
make the demand unless the secured party knows that the person is not entitled to make it.


                           PART III

                  PERFECTION AND PRIORITIES

         20 A security interest is perfected when

            (a) it has attached; and

            (b) all steps required for perfection pursuant to this Act have been completed,

regardless of the order of occurrence.


         21 (1) An unperfected security interest in collateral is subordinate to the interest of

                (a) a judgment creditor who has registered a notice of judgment in the
            Registry pursuant to Section 2A of the Creditors' Relief Act if the security interest
            is unperfected when the notice is registered;

                (b) all persons entitled by the Creditors' Relief Act or otherwise to
            participate in a distribution of personal property subject to the interest of a creditor
            referred to in clause (a); and

                (c) a sheriff and a representative of creditors for the purpose of enforcing
            the rights of a creditor referred to in clause (a).

            (2) An unperfected security interest in collateral is not effective against

                (a) a trustee in bankruptcy if the security interest is unperfected at the time
            of the bankruptcy;

                (b) a liquidator appointed pursuant to the Winding-up Act (Canada) if the
            security interest is unperfected when the winding-up order is made; or

                (c) a creditor, assignee or sheriff who has registered a notice of claim in
            the Registry pursuant to Section 2C of the Creditors' Relief Act for the purpose of
            any enforcement proceedings commenced pursuant to the enactments referred to
            in that Section if the security interest is unperfected at the time the notice of claim
            is registered.

            (3) An unperfected security interest in collateral is subordinate to the interest of
a transferee of the collateral if the transferee

                (a) acquires the interest under a transaction that is not a security
            agreement;

                (b) gives value; and

                (c) acquires the interest without knowledge of the security interest and
            before the security interest is perfected.

            (4) For the purpose of subsection (3), a purchaser of an instrument or a security
or a holder of a negotiable document of title who acquires it under a transaction entered into in
the ordinary course of the transferor's business has knowledge only if the purchaser or holder
acquires the interest with knowledge that the transaction violates the terms of the security
agreement creating or providing for the security interest.


         22 Where the interest of a lessor under a lease for a term of more than one year or of
a consignor under a commercial consignment is not effective against a person under clause
21(2)(a) or (b) or where the leased goods are seized pursuant to judgment enforcement
proceedings by a person entitled to priority under subsection 21(1), the lessor or consignor is
deemed to have suffered damages, as against the lessee or consignee in an amount equal to

            (a) the value of the leased or consigned goods at the time of the bankruptcy,
         winding-up order or seizure; and

            (b) the amount of the loss, other than that referred to in clause (a), resulting from
         the termination of the lease or consignment.


         23 (1) A purchase money security interest in collateral, other than an intangible, has
priority over the interests of persons referred to in subsections 21(1) and (2) if it is perfected not
later than fifteen days after the debtor, or another person at the request of the debtor, obtains
possession of the collateral, whichever is earlier.

            (2) Where goods are shipped by common carrier to a debtor or to a person
designated by the debtor, the debtor does not have possession of the goods for the purpose of
subsection (1) until the debtor, or another person at the request of the debtor, has obtained
actual possession of the goods or a document of title to the goods, whichever is earlier.

            (3) A purchase money security interest in an intangible has priority over the
interests of persons referred to in subsections 21(1) and (2) if it is perfected not later than fifteen
days after it attaches.

            (4) A security interest in goods referred to in paragraph 2(ar)(ii)(D) has priority
over the interests of persons referred to in subsections 21(1) and (2) if it is perfected not later
than thirty days after the sale of the goods.


         24 (1) Where a security interest is originally perfected pursuant to this Act and is
again perfected in some other way pursuant to this Act without an intermediate period when it
is unperfected, the security interest is deemed to be perfected continuously for the purpose of this
Act.

            (2) A transferee of a security interest has the same priority in relation to
perfection of the security interest as the transferor had at the time of the transfer.


         25 (1) Subject to Section 20, possession of the collateral by the secured party, or on
the secured party's behalf by another person, perfects a security interest in

                (a) goods;

                (b) a negotiable document of title;

                (c) chattel paper;

                (d) a security;

                (e) an instrument; or

                (f) money.

            (2) A secured party does not have possession of collateral for the purpose of
subsection (1) if

                (a) the collateral is in the actual or apparent possession or control of the
            debtor or the debtor's agent; or

                (b) possession is the result of seizure or repossession.


         26 Subject to Section 20, registration of a financing statement perfects a security
interest in collateral.


         27 (1) Where a security interest in an instrument or a security is perfected by
possession pursuant to Section 25 and the secured party delivers the instrument or security to
the debtor for the purpose of

                (a) ultimate sale or exchange;

                (b) presentation, collection or renewal; or

                (c) registration of a transfer,

the security interest remains perfected, notwithstanding Section 11, for the first fifteen days after
the collateral comes under the control of the debtor.

            (2) Where a security interest in a negotiable document of title or in goods held
by a bailee that are not covered by a negotiable document of title is perfected by possession
pursuant to Section 25 and the secured party makes the document of title or goods available to
the debtor for the purpose of

                (a) ultimate sale or exchange;

                (b) loading, unloading, storing, shipping or trans-shipping; or

                (c) manufacturing, processing, packaging or other dealing with goods in
            a manner preliminary to their sale or exchange,

the security interest remains perfected, notwithstanding Section 11, for the first fifteen days after
the collateral comes under the control of the debtor.

            (3) On the expiry of the fifteen-day period referred to in subsection (1) or (2), a
security interest referred to in those subsections is subject to the other provisions of this Act
relating to the perfection of a security interest.


         28 (1) Subject to Section 20, a security interest in goods in the possession of a bailee
is perfected by

                (a) possession of the goods by the bailee on the secured party's behalf
            pursuant to Section 25;

                (b) registration of a financing statement relating to the goods pursuant to
            Section 26;

                (c) the issue by the bailee of a document of title to the goods in the name
            of the secured party;

                (d) the deposit by a secured party to whom a non-negotiable receipt has
            been transferred of the transfer with the warehouseman who issued the receipt in
            accordance with Section 22 of the Warehouse Receipts Act; or

                (e) perfection of a security interest in a negotiable document of title to the
            goods if the bailee has issued one.

            (2) The issue of a negotiable document of title covering goods does not preclude
any other security interest in the goods from arising during the period that the negotiable
document of title is outstanding.

            (3) A perfected security interest in a negotiable document of title covering goods
takes priority over a security interest in the goods that is otherwise perfected after the goods
become covered by the negotiable document of title.


         29 (1) Subject to this Act, where collateral is dealt with or otherwise gives rise to
proceeds, the security interest

                (a) continues in the collateral unless the secured party expressly or
            impliedly authorizes the dealing, and

                (b) extends to the proceeds.

            (2) Where a secured party enforces a security interest against both the collateral
and the proceeds, the amount secured by the security interest in the collateral and the proceeds
is limited to the market value of the collateral at the date of the dealing.

            (3) A security interest in proceeds is a continuously perfected security interest if
the interest in the original collateral is perfected by registration of a financing statement
pursuant to Section 26 that includes a description of

                (a) the proceeds that would be sufficient to perfect a security interest in
            original collateral of the same kind;

                (b) the original collateral, if the proceeds are of a kind that are within the
            description of the original collateral; or

                (c) the original collateral, if the proceeds consist of money, cheques or
            deposit accounts in a bank, credit union or similar financial institution.

            (4) Where the security interest in the original collateral is perfected other than
in a manner referred to in subsection (3), the security interest in the proceeds is a continuously
perfected security interest for the first fifteen days after the security interest in the original
collateral attaches to the proceeds but becomes unperfected on the expiry of that period, unless
the security interest in the proceeds is otherwise perfected by any of the methods and under the
circumstances specified in this Act for original collateral of the same kind.


         30 (1) Where a debtor sells or leases goods that are subject to a security interest
under circumstances in which the buyer or lessee takes free of the security interest under clause
29(1)(a) or Section 31, the security interest reattaches to the goods if

                (a) the goods are returned to, seized or repossessed by the debtor or a
            transferee of chattel paper created by the sale or lease; and

                (b) the obligation secured remains unpaid or unperformed.

            (2) Where a security interest reattaches under subsection (1), the perfection of
the security interest and the time of registration or perfection shall be determined as if the goods
had not been sold or leased if

                (a) the security interest was perfected by registration pursuant to Section
            26 when the goods were sold or leased; and

                (b) the registration is effective when the goods are returned, seized or
            repossessed.

            (3) Where a sale or lease of goods creates an account or chattel paper that is
transferred to a secured party, and the goods are returned to, seized or repossessed by the
debtor or the transferee of the chattel paper, the transferee of the account or chattel paper has
a security interest in the goods that attaches when the goods are returned, seized or repossessed.

            (4) A security interest in goods arising under subsection (3) is perfected if the
security interest in the account or chattel paper was perfected when the goods were returned,
seized or repossessed, but becomes unperfected on the expiry of fifteen days after the return,
seizure or repossession, unless the transferee registers a financing statement relating to the
security interest or takes possession of the goods by seizure, repossession or otherwise, before
the expiry of that fifteen-day period.

            (5) A security interest in goods that a transferee of an account has under
subsection (3) is subordinate to a perfected security interest that re-attaches under subsection
(1) and to a security interest of a transferee of chattel paper that arises under subsection (3).

            (6) A security interest in goods that a transferee of chattel paper has under
subsection (3) has priority over

                (a) a security interest in goods that re-attaches under subsection (1); and

                (b) a security interest in goods as after-acquired property that attaches on
            the return, seizure or repossession of the goods,

if the transferee of the chattel paper would have priority under subsection 32(6) as to the chattel
paper over an interest in the chattel paper claimed by the holder of the security interest in the
goods.

            (7) A security interest in goods given by a buyer or lessee of the goods referred
to in subsection (1), that attaches while the goods are in the possession of the buyer, lessee or
debtor and that is perfected when the goods are returned, seized or repossessed, has priority
over a security interest in the goods arising under this Section.


         31 (1) In this Section,

                (a) "buyer of goods" includes a person who obtains vested rights in goods
            under a contract to which the person is a party, as a consequence of the goods
            becoming a fixture or accession to property in which the person has an interest;

                (b) "ordinary course of business of the seller" includes the supply of goods
            in the ordinary course of business as part of a contract for services and materials;

                (c) "seller" includes a person who supplies goods that become a fixture or
            accession under a contract with a buyer or under a contract with a person who is
            party to a contract with such a buyer.

            (2) A buyer or lessee of goods sold or leased in the ordinary course of business
of the seller or lessor takes free of any perfected or unperfected security interest given by the
seller or lessor or arising under Section 29 or 30, whether or not the buyer or lessee knows of
it, unless the buyer or lessee also knows that the sale or lease constitutes a breach of the security
agreement under which the security interest was created.

            (3) A buyer or lessee of goods that are acquired as consumer goods takes free
of a perfected or unperfected security interest in the goods if the buyer or lessee

                (a) gave value for the interest acquired; and

                (b) bought or leased the goods without knowledge of the security interest.

            (4) Subsection (3) does not apply to a security interest in

                (a) a fixture; or

                (b) goods if the purchase price of the goods exceeds one thousand dollars
            or if the market value of the goods, in the case of a lease, exceeds one thousand
            dollars.

            (5) A buyer or lessee of goods who buys or leases the goods during any of the
fifteen-day periods referred to in subsection 27(1) or (2), 29(4), 30(4) or Section 52 takes free
of the security referred to in those provisions if the buyer or lessee

                (a) gave value for the interest acquired; and

                (b) bought or leased the goods without knowledge of the security interest
            and

                    (i) in a case within subsection 27(1) or (2), 29(4) or 30(4), before
                the security interest was perfected by possession pursuant to Section 25 or by
                registration pursuant to Section 26, or

                    (ii)    in a case within Section 52, before the registration of the security
                interest was amended in accordance with that Section or the secured party
                took possession of the collateral.

            (6) A buyer or lessee of goods takes free of a security interest in the goods
perfected by registration pursuant to Section 26 if

                (a) the buyer or lessee bought or leased the goods without knowledge of the
            security interest; and

                (b) the goods were not described by serial number in the registration
            relating to the security interest.

            (7) Subsection (6) applies only to goods that are equipment and that are of a kind
that are prescribed as serial numbered goods.

            (8) A sale or lease under subsection (2), (3), (5) or (6) may be

                (a) for cash;

                (b) by exchange for other property; or

                (c) on credit,

and includes the delivery of goods or a document of title under a pre-existing contract for sale
but does not include a transfer as security for, or in total or partial satisfaction of, a money debt
or past liability.


         32 (1) A holder of money has priority over a security interest in it perfected by
registration pursuant to Section 26 or temporarily perfected under subsection 29(4) if the holder

                (a) acquired the money without knowledge that it is subject to the security
            interest; or

                (b) is a holder for value, whether or not that person acquired the money
            without knowledge that it is subject to the security interest.

            (2) A creditor who receives an instrument drawn or made by a debtor and
delivered in payment of a debt owing to the creditor by that debtor has priority over a security
interest in the instrument whether or not the creditor has knowledge of the security interest in
the instrument at the time of delivery.

            (3) A purchaser of an instrument or a security has priority over a security interest
in the instrument or security perfected by registration pursuant to Section 26 or temporarily
perfected under subsection 27(1) or 29(4) if the purchaser

                (a) gave value for the instrument or security;

                (b) acquired the instrument or security without knowledge that it is subject
            to a security interest; and

                (c) took possession of the instrument or security.

            (4) A holder to whom a negotiable document of title is negotiated has priority
over a security interest in the document of title that is perfected by registration pursuant to
Section 26 or temporarily perfected under subsection 27(2) or 29(4) if the holder

                (a) gave value for the document of title; and

                (b) acquired the document of title without knowledge that it is subject to a
            security interest.

            (5) For the purpose of subsections (3) and (4), a purchaser of an instrument or
a security or a holder of a negotiable document of title who acquires it under a transaction
entered into in the ordinary course of the transferor's business has knowledge only if the
purchaser acquires the interest with knowledge that the transaction violates the terms of the
security agreement creating or providing for the security interest.

            (6) A purchaser of chattel paper who takes possession of it in the purchaser's
ordinary course of business and for new value has priority over any security interest in the
chattel paper that

                (a) was perfected by registration pursuant to Section 26, if the purchaser
            does not have knowledge at the time of taking possession that the chattel paper is
            subject to a security interest; or

                (b) has attached to proceeds of inventory under Section 29, whatever the
            extent of the purchaser's knowledge.


         33 A lien on goods that arises as a result of the provision, in the ordinary course of
business, of materials or services in respect of the goods, has priority over a perfected or
unperfected security interest in the goods unless the lien arises under an Act that provides that
it is not to have such priority.


         34 (1) In this Section, "transfer" includes a sale, the creation of a security interest
or a transfer under judgment enforcement proceedings.

            (2) The rights of a debtor in collateral may be transferred consensually or by
operation of law notwithstanding a provision in the security agreement prohibiting transfer or
declaring a transfer to be a default, but a transfer by the debtor does not prejudice the rights of
the secured party under the agreement or otherwise, including the right to treat a prohibited
transfer as an act of default.


         35 (1) Subject to Section 29, a purchase money security interest in

                (a) collateral or its proceeds, other than intangibles or inventory, that is
            perfected not later than fifteen days after the debtor, or another person at the
            request of the debtor, obtains possession of the collateral, whichever is earlier; or

                (b) an intangible or its proceeds that is perfected not later than fifteen days
            after the security interest in the intangible attaches,

has priority over any other security interest in the same collateral given by the same debtor.

            (2) Subject to Section 29, a purchase money security interest in inventory or its
proceeds has priority over any other security interest in the same collateral given by the same
debtor if

                (a) the purchase money security interest in the inventory is perfected when
            the debtor, or another person at the request of the debtor, obtains possession of the
            collateral, whichever is earlier;

                (b) the secured party gives a notice to any other secured party who has
            registered, before the registration of the financing statement relating to the
            purchase money security interest in the inventory, a financing statement where the
            collateral description in the financing statement includes the same item or kind of
            collateral or includes accounts;

                (c) the notice referred to in clause (b) states that the person giving the
            notice expects to acquire a purchase money security interest in inventory of the
            debtor, and describes the inventory by item or kind; and

                (d) the notice is given before the debtor, or another person at the request
            of the debtor, obtains possession of the collateral, whichever is earlier.

            (3) A notice pursuant to subsection (2) may be given in accordance with Section
70 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 clause (2)(b).

            (4) A purchase money security interest in goods or, subject to Section 29, in their
proceeds, taken by a seller, lessor or consignor of the collateral, that is perfected

                (a) in the case of inventory, when a debtor, or another person at the
            request of the debtor, obtains possession of the collateral, whichever is earlier; and

                (b) in the case of collateral other than inventory, not later than fifteen days
            after a debtor, or another person at the request of a debtor, obtains possession of
            the collateral, whichever is earlier,

has priority over any other purchase money security interest in the same collateral given by the
same debtor.

            (5) A purchase money security interest in collateral as original collateral has
priority over a purchase money security interest in the same collateral as proceeds, if it is
perfected

                (a) in the case of inventory, when a debtor, or another party at the request
            of a debtor, obtains possession of the collateral, whichever is earlier; and

                (b) in the case of collateral other than inventory, not later than fifteen days
            after a debtor, or another person at the request of a debtor, obtains possession of
            the collateral, whichever is earlier.

            (6) Where goods are shipped by common carrier to a debtor or to a person
designated by a debtor, the debtor does not have possession of the goods for the purpose of this
Section until the debtor, or another person at the request of the debtor, has obtained actual
possession of the goods or a document of title to the goods, whichever is earlier.

            (7) A purchase money security interest in an item of collateral does not extend
to or continue in the proceeds of the item after the obligation to pay the purchase price of the
item or repay the value given for the purpose of enabling the debtor to acquire rights in it has
been discharged.

            (8) A perfected security interest in crops or their proceeds, given for value to
enable a debtor to produce the crops and given while the crops are growing crops or during a
period of six months immediately before the time the crops become growing crops, has priority
over any other security interest in the same collateral given by the same debtor.

            (9) A perfected security interest in fowl, cattle, horses, sheep, swine or fish or
their proceeds given for value to enable the debtor to acquire food, drugs or hormones to be fed
to or placed in the animals or fish has priority over any other security interest in the same
collateral or its proceeds given by the same debtor other than a perfected purchase money
security interest.


         36 (1) Where this Act provides no other method for determining priority between
competing security interests in the same collateral,

                (a) priority between perfected security interests is determined by the order
            of the occurrence of

                    (i) the registration of a financing statement pursuant to Section 26
                without regard to the time of attachment of the security interest,

                    (ii)    possession of the collateral pursuant to Section 25 without
                regard to the time of attachment of the security interest, or

                    (iii)   perfection under Sections 6, 8, 27, 30 or 75,

            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.

            (2) For the purpose 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.

            (3) For the purpose of subsection (1) and subject to Section 29, 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.

            (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
purpose of subsection (1), (7) or (8) or 35(1) unless a financing statement relating to the security
interest that includes a description of the goods by serial number is registered.

            (5) Subject to subsection (6), the priority that a security interest has under
subsection (1) applies to all advances, including future advances.

            (6) A perfected security interest has priority over the interest of a judgment
creditor referred to in clause 21(1)(a) only to the extent of

                (a) advances made before the judgment creditor registers the notice of
            judgment referred to in clause 21(1)(a);

                (b) advances made before the secured party has knowledge of the
            registration of the notice of judgment referred to in clause 21(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 clause (b); and

                (d) reasonable costs and expenses incurred by the secured party for the
            protection, preservation, maintenance or repair of the collateral.

            (7) Where 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.

            (8) Where 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 52
            disclosing the transferee as the new debtor; and

                (b) before the secured party referred to in clause (a) takes possession of
            the collateral or registers a financing change statement in accordance with Section
            52 disclosing the transferee as the new debtor.

            (9) Subsection (8) does not apply if the transferee acquires the debtor's interest
free of the security interest granted by the debtor.


         37 (1) In this Section, "secured party" includes a receiver.

            (2) Except as provided in Section 31 and subsections (3), (4) and (9), a security
interest in goods that attaches before or when the goods become fixtures has priority with respect
to the goods over a claim to the goods made by a person with an interest in the land.

            (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 land after the goods become fixtures,
including an assignee for value of the interest of a person with an interest in the land at the time
the goods become fixtures, if the interest is acquired without fraud and before notice of the
security interest is registered pursuant to Section 50.

            (4) A security interest referred to in subsection (2) is subordinate to the interest
of a person with a registered mortgage of the land who, after the goods become fixtures,

                (a) makes an advance under the mortgage, but only with respect to that
            advance, or

                (b) obtains an order for sale, foreclosure or foreclosure and sale,

without fraud and before notice of the security interest in the fixtures is registered pursuant to
Section 50.

            (5) Where a notice of a security interest in fixtures has not been registered
pursuant to Section 50 when a search is made of the records of the registry of deeds by or on
behalf of a person with a registered mortgage of the land, any advance under the mortgage made
on the same day that the search was made is deemed to have been made before registration of
a notice pursuant to Section 50, notwithstanding that the notice was registered on the same day
that the search was made.

            (6) The priority under this Section of a person with an interest in the land referred
to in subsection (3) or of a person with a registered mortgage of land referred to in subsection
(4) is not affected by priority rights in the land under the Registry Act.

            (7) A security interest in goods that attaches after the goods become fixtures is
subordinate to the interest of a person who has an interest in the land when the goods become
fixtures and who

                (a) has not consented to the security interest;

                (b) has not disclaimed an interest in the goods or fixtures;

                (c) has not entered into an agreement entitling the person to remove the
            goods; or

                (d) is not otherwise precluded from preventing the debtor from removing
            the goods.

            (8) A security interest in goods that attaches after the goods become fixtures is
subordinate to the interest of a person who acquires an interest in the land after the goods
become fixtures if the interest is acquired without fraud and before notice of the security interest
in the fixtures is registered pursuant to Section 50.

            (9) A security interest in goods that attaches before, when or after the goods
become fixtures is subordinate to the interest of a creditor of the debtor who causes a certificate
of judgment affecting the land to be registered pursuant to the Registry Act before notice of the
security interest in the fixtures is registered pursuant to Section 50.

            (10)    The interest of a creditor of the debtor referred to in subsection (9) does not
take priority over a purchase money security interest in goods that become fixtures if a notice
of the security interest in the fixtures is registered pursuant to Section 50 not later than fifteen
days after the goods are affixed to the land.

            (11)    A secured party who has the right, under this Act, to remove goods from land
shall exercise the right of removal in a manner that causes no unnecessary damage or injury to
the land and to other property situated on it or that puts the occupier of the land to any greater
inconvenience than is necessarily incidental to the removal of the goods.

            (12)    A person, other than the debtor, who has an interest in the land when the
goods subject to the security interest are affixed to the land is entitled to reimbursement for any
damage to the interest of the person in the land caused during the removal of the goods, but is
not entitled to reimbursement for diminution in the value of the land caused by the absence of the
goods removed or by the necessity to replace them.

            (13)    A person entitled to reimbursement under subsection (12) may refuse
permission to remove the goods until the secured party has given adequate security for the
reimbursement.

            (14)    The secured party may apply to the Court for an order

                (a) determining the person entitled to reimbursement under this Section;

                (b) determining the amount and kind of security to be provided by the
            secured party;

                (c) specifying the depository for the security;

                (d) authorizing the removal of the goods without the provision of security
            for reimbursement under subsection (13).

            (15)    Where the interest of a person with an interest in the land is subordinate to
a security interest in the goods under this Section, the person with an interest in the land may,
before the goods have been removed from the land by the secured party, retain the goods on
payment to the secured party of the lesser of

                (a) the amount secured by the security interest in the goods that has
            priority over the interest of the person with the interest in the land; and

                (b) the market value of the goods were the goods to be removed from the
            land.

            (16)    A secured party who has a right to remove goods from land shall give to each
person who appears by the records of the registry of deeds for the registration district in which
the land is located to have an interest in the land, a notice of the intention of the secured party
to remove the goods.

            (17)    A notice pursuant to subsection (16) 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 obligation secured by the security
            interest;

                (d) the market value of the goods;

                (e) a description of the land to which the goods are affixed; and

                (f) a statement of intention to remove the goods unless the amount referred
            to in subsection (15) is paid on or before a specified date that is not less than fifteen
            days after the notice is given pursuant to subsection (16).

            (18)    A notice pursuant to subsection (16) shall be given at least fifteen days before
removal of the goods and may be given in accordance with Section 70 or by registered mail
addressed to the address last known to the secured party of the person entitled to the notice.

            (19)    A person entitled to receive a notice pursuant to subsection (16) may apply
to the Court for an order postponing removal of the goods from the land.


         38 (1) In this Section, "secured party" includes a receiver.

            (2) Except as provided in subsections (3), (4), (5) and (7), a security interest in
crops has priority with respect to the crops over a claim to the crops made by a person with an
interest in the land.

            (3) A security interest in crops is subordinate to the interest of a person who
acquires for value an interest in the land while the crops are growing crops, including an
assignee for value of the interest of a person with an interest in the land while the crops are
growing crops, if the interest is acquired without fraud and before notice of the security interest
is registered pursuant to Section 50.

            (4) A security interest in crops is subordinate to the interest of a person with a
registered mortgage of the land who, after the crops become growing crops,

                (a) makes an advance under the mortgage, but only with respect to that
            advance; or

                (b) obtains an order for sale, foreclosure or foreclosure and sale,

without fraud and before notice of the security interest in the crops is registered pursuant to with
Section 50.

            (5) Where a notice of a security interest in crops has not been registered pursuant
to Section 50 when a search is made of the records of the registry of deeds for the registration
district in which the lands are located by or on behalf of a person with a registered mortgage of
the land, any advance under the mortgage made on the same day that the search was made is
deemed to have been made before registration of a notice pursuant to Section 50,
notwithstanding that the notice was registered on the same day that the search was made.

            (6) The priority under this Section of a person with an interest in the land referred
to in subsection (3) or of a person with a registered mortgage of the land referred to in
subsection (4) is not affected by priority rights in the land under the Registry Act.

            (7) A security interest in crops is subordinate to the interest of a creditor of the
debtor who causes a certificate of judgment affecting the land to be registered pursuant to the
Registry Act before notice of the security interest is registered pursuant to Section 50.

            (8) The interest of a creditor of the debtor referred to in subsection (7) does not
take priority over a purchase money security interest in the crops or a security interest in the
crops referred to in subsection 35(10) if a notice of the security interest in the crops is registered
pursuant to Section 50 not later than fifteen days after the security interest in the crops attaches.

            (9) Subsections 37(11) to (19) apply mutatis mutandis to the seizure and removal
of growing crops from land.


         39 (1) In this Section,

                (a) "other goods" means goods to which an accession is installed or
            affixed;

                (b) "secured party" includes a receiver;

                (c) "the whole" means an accession and the goods to which the accession
            is installed or affixed.

            (2) Except as provided in Section 31 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.

            (3) A security interest referred to in subsection (2) is subordinate to the interest
of a person who, after the goods become an accession, acquires for value an interest in the
whole, including an assignee of the interest of a person with an interest in the whole if the
assignee acquires the interest for value and after the goods become an accession and before a
financing statement in relation to the security interest is registered.

            (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.

            (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.

            (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.

            (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 clause 21(1)(a) if the security interest is not perfected when a notice of
judgment referred to in clause 21(1)(a) is registered.

            (8) The interest of a judgment creditor referred to in clause 21(1)(a) does not take
priority under subsection (7) over a purchase money security interest in goods that is perfected
within fifteen days after the goods become an accession.

            (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.

            (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.

            (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.

            (12)    The secured party may apply to the Court for an order

                (a) determining the person entitled to reimbursement under this Section;

                (b) determining the amount and kind of security to be provided by the
            secured party;

                (c) specifying the depository for the security;

                (d) authorizing the removal of the accession without the provision of
            security for reimbursement under subsection (11).

            (13)    Where 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

                (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.

            (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 who

                (a) is known by the secured party to have an interest in the other goods or
            in the whole; and

                (b) 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.

            (15)    A notice pursuant to 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).

            (16)    A notice pursuant to subsection (14) shall be given at least fifteen days before
removal of the accession and may be given in accordance with Section 70 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 clause (14)(b).

            (17)    A person entitled to receive a notice under subsection (14) may apply to the
Court for an order postponing removal of the accession.


         40 (1) A perfected security interest in goods that subsequently become part of a
product or mass continues in the product or mass if the goods are so manufactured, processed,
assembled or commingled that their identity is lost in the product.

            (2) Subject to subsections (4) and (6), where more than one perfected security
interest continues in the same product or mass under subsection (1), and each was a security
interest in separate goods, the security interests are entitled to share in the product or mass
according to the ratio that the obligation secured by each security interest bears to the sum of
the obligations secured by all security interests.

            (3) For the purpose of Section 36, perfection of a security interest in goods that
subsequently become part of a product or mass is also perfection of the security interest in the
product or mass.

            (4) For the purpose of subsection (2), the obligation secured by a security interest
that continues in the product or mass under subsection (1) is limited to the market value of the
goods when the goods become part of the product or mass.

            (5) Any priority that a perfected security interest that continues in the product or
mass under subsection(1) has over an interest in the product or mass is limited to the market
value of the goods when the goods become part of the product or mass.

            (6) A perfected purchase money security interest in goods that continues in the
product or mass under subsection (1) has priority over a non-purchase money security interest

                (a) in the goods that continues in the product or mass under subsection
            (1); and

                (b) in the product or mass, other than as inventory, given by the same
            debtor.

            (7) A perfected purchase money security interest in goods that continues in the
product or mass under subsection (1) has priority over any non-purchase money security interest
in the product or mass as inventory given by the same debtor if

                (a) the secured party with the purchase money security interest gives a
            notice to any secured party with a non-purchase money security interest in the
            product or mass who has registered, before the identity of the goods is lost in the
            product or mass, a financing statement that includes a description of the product
            or mass;

                (b) the notice referred to in clause (a) states that the person giving the
            notice has acquired or expects to acquire a purchase money security interest in
            goods supplied to the debtor as inventory; and

                (c) the notice is given before the identity of the goods is lost in the product
            or mass.

            (8) A notice pursuant to subsection (7) may be given in accordance with Section
70 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 clause (7)(a).

            (9) This Section does not apply to a security interest in an accession to which
Section 39 applies.


         41 (1) A secured party may subordinate, in a security agreement or otherwise, the
secured party's security interest to any other interest.

            (2) A subordination is effective according to its terms between the parties and may
be enforced by a third party if the third party is the person or one of the class of persons for
whose benefit the subordination was intended.


         42 (1) In this Section,

                (a) "account debtor" means a person who is obligated under an intangible
            or chattel paper;

                (b) "assignee" includes a secured party and a receiver.

            (2) Unless the account debtor on an intangible or chattel paper has made an
enforceable agreement not to assert defenses or claims arising out of a contract, the rights of
an assignee of the intangible or chattel paper are subject to

                (a) the terms of the contract between the account debtor and the assignor
            and any defense or claim arising from the contract or a closely connected contract;
            and

                (b) any other defense or claim of the account debtor against the assignor
            that accrues before the account debtor acquires knowledge of the assignment.

            (3) A modification of or substitution for a contract made in good faith and in
accordance with reasonable commercial standards and without material adverse effect on the
assignee's rights under the contract or the assignor's ability to perform the contract is effective
against the assignee unless the account debtor has otherwise agreed.

            (4) Subsection (3) applies

                (a) to the extent that an assigned right to payment arising out of the
            contract has not been earned by performance; and

                (b) notwithstanding that notice of the assignment has been given to the
            account debtor.

            (5) Where the contract has been substituted or modified in the manner referred
to in subsection (3), the assignee obtains rights corresponding to those of the assignor under the
modified or substituted contract.

            (6) Nothing in subsections (3) to (5) affects the validity of a term in an assignment
agreement that provides that a modification or substitution referred to in those subsections is a
breach of contract by the assignor.

            (7) Where collateral that is either an intangible or chattel paper is assigned, the
account debtor may make payments to the assignor

                (a) before the account debtor receives notice of the assignment in
            accordance with subsection (8); or

                (b) after the account debtor receives notice of the assignment if the account
            debtor requests the assignee to furnish proof of the assignment and the assignee
            fails to furnish proof within fifteen days after the request.

            (8) A notice of an assignment pursuant to subsection (7) shall

                (a) state that the amount payable or to become payable under the contract
            has been assigned and that payment is to be made to the assignee; and

                (b) identify the contract under which the amount payable is to become
            payable.

            (9) Payment by an account debtor to an assignee after the account debtor receives
notice of the assignment in accordance with subsection (8) discharges the obligation of the
account debtor to the extent of the payment.

            (10)    A term in a contract between a debtor on an account or chattel paper and an
assignor that prohibits or restricts assignment of the whole of the account or chattel paper for
money due or to become due is binding on the assignor only to the extent that the assignor may
be liable in damages for breach of the term, but is unenforceable against third parties.


                           PART IV

                         REGISTRATION

         43 (1) There shall be an electronic registry known as the Personal Property Registry
for the purpose of registrations pursuant to this Act and pursuant to any other Act that provides
for registration in the Registry.


         (2)    The Registrar shall be appointed in accordance with the Civil Service Act.

            (3) One or more deputy registrars shall be appointed in accordance with the Civil
Service Act.

            (4) The Registrar shall supervise and administer the operation of the Registry and
has such powers and duties as are set out in this Act or the regulations or any other Act that
provides for registration in the Registry or the regulations pursuant to that Act.

            (5) A deputy registrar has the same powers and duties as the Registrar, subject
to the direction and supervision of the Registrar.

            (6) The Registrar and deputy registrars may designate one or more persons to
act on their behalf.

            (7) When it is not practical, in the opinion of the Registrar, to provide access to
the Registry or to provide one or more Registry services, the Registrar may refuse access to the
Registry or otherwise suspend one or more of its services.


         44 (1) A person may register a financing statement in the Registry at an office of the
Registry in accordance with the regulations.

            (2) The Registrar may enter into an agreement with any person to provide access
to the Registry on terms and conditions that the Registrar considers advisable and may vary the
terms and conditions from time to time as the Registrar considers advisable.

            (3) A person who has entered into an agreement with the Registrar pursuant to
subsection (2) may register a financing statement in the Registry in accordance with the
agreement and the regulations.

            (4) Registration of a financing statement is effective from the time that a
registration number, date and time is assigned to the registration in the Registry.

            (5) A financing statement may be registered before or after a security agreement
is made or a security interest attaches.

            (6) A registration may relate to one or more than one security agreement.

            (7) The validity of the registration of a financing statement is not affected by any
defect, irregularity, omission or error in the financing statement unless the defect, irregularity,
omission or error is seriously misleading.

            (8) Subject to subsection (10), a registration is invalid if there is a seriously
misleading defect, irregularity, omission or error in

                (a) the name of any of the debtors required to be included in the financing
            statement other than a debtor who does not own or have rights in the collateral; or

                (b) the serial number of the collateral if the collateral is consumer goods
            of a kind that are prescribed as serial numbered goods.

            (9) In order to establish that a defect, irregularity, omission or error is seriously
misleading, it is not necessary to prove that anyone was actually misled by it.

            (10)    Failure to include a description of any item or kind of collateral in a financing
statement does not affect the validity of the registration with respect to the description of other
collateral included in the financing statement.

            (11)    The secured party or person named as secured party in a financing statement
shall give to each person named as debtor in the statement, within thirty days after it is
registered, a verification statement in accordance with the regulations, except where that person
has waived in writing the right to receive it.


         45 (1) Except as otherwise prescribed, a registration pursuant to this Act is effective
for the period of time specified as part of the financing statement by which the registration is
effected.

            (2) A registration may be renewed by registering a financing change statement
at any time before the registration expires and, except as otherwise prescribed, the period of time
for which the registration is effective shall be extended by the renewal period specified as part
of  the financing change statement.

            (3) An amendment to a registration may be effected by registering a financing
change statement at any time during the period that the registration is effective and the
amendment is effective from the time that the financing change statement is registered to the
expiry of the registration being amended.

            (4) Notwithstanding that an amendment of a registration is not specifically
provided for in this Part, a financing change statement may be registered to amend the
registration.


         46 (1) Where a secured party with a security interest that is perfected by registration
transfers the security interest or a part of it, a financing change statement may be registered to
disclose the transfer.

            (2) Where a financing change statement is registered pursuant to subsection (1)
and an interest in part, but not all, of the collateral is transferred, the financing change statement
shall include a description of the collateral in which the interest is transferred.

            (3) Where a secured party with a security interest that is not perfected by
registration transfers the security interest, a financing statement may be registered in which the
transferee is disclosed as the secured party.

            (4) After registration of a financing change statement disclosing a transfer of a
security interest, the transferee is the secured party for the purpose of this Part.

            (5) A registration disclosing a transfer of a security interest may be registered
before or after the transfer.

            (6) Where a security interest has been subordinated by the secured party to the
interest of another person, a financing change statement may be registered to disclose the
subordination at any time during the period that the registration of the subordinated security
interest is effective.


         47 Data in a registration may be removed from the records of the Registry

            (a) when the registration is no longer effective; or

            (b) on the registration of a financing change statement discharging or partially
         discharging the registration.


         48 Registration of a financing statement in the Registry by itself does not constitute
notice or knowledge to any person of the existence or contents of the financing statement or of
the existence of the security interest or the contents of any security agreement to which the
registration relates.


         49 (1) A person may search the records of the Registry and obtain a printed search
result

                (a) at an office of the Registry; or

                (b) in accordance with an agreement entered into with the Registrar
            pursuant to subsection 44(2).

            (2) A search pursuant to subsection (1) may be conducted according to

                (a) the name of the debtor;

                (b) the serial number of goods of a kind that are prescribed as serial
            numbered goods; or

                (c) a registration number.

            (3) A printed search result that purports to be issued by the Registry is receivable
as evidence and is, in the absence of evidence to the contrary, proof of the registration of any
financing statement to which the search result relates, including

                (a) the date and time of registration of the financing statement; and

                (b) the order of registration of the financing statement as indicated by the
            registration number, date and time set out in the printed search result.


         50 (1) In this Section,

                (a) "debtor" includes any person named as a debtor in a notice registered
            pursuant to this Section;

                (b) "secured party" includes any person named as a secured party in a
            notice registered pursuant to this Section.

            (2) A security interest in a fixture under Section 37 and a security interest in a
crop under Section 38 may be registered in a registry of deeds by submitting a notice in
accordance with the regulations to that registry.

            (3) On the submission of a notice pursuant to subsection (2) and on the payment
of any prescribed fee, the registrar of deeds shall register it in that office.

            (4) On the registration of a notice pursuant to subsection (3), every person
dealing with the land to which the notice relates is deemed to have knowledge of the security
interest referred to in the notice.

            (5) The secured party or person named as secured party in a notice registered
pursuant to subsection (3) shall give to each person named as a debtor in the notice, within thirty
days after it is registered, a copy of the notice, except where that person has waived in writing
the right to receive it.

            (6) Where a notice registered pursuant to subsection (3) has not expired, notice
of its renewal, amendment or discharge or notice of the transfer or subordination of the security
interest to which it relates may be registered by submitting a notice in accordance with the
regulations to the registry of deeds in which the notice is registered.

            (7) On the submission of a notice pursuant to subsection (6) and on the payment
of any prescribed fee, the registrar of the registry of deeds to which the notice is submitted shall
register it in that office.

            (8) Subsections 44(6), (7), (8), (10) and (11) and Sections 45 and 46 apply
mutatis mutandis to the notices referred to in subsections (2) and (6).

            (9) Where a notice registered pursuant to subsection (3) expires or a notice of its
discharge is registered pursuant to subsection (7), it is of no effect and the appropriate registrar
may cancel registration of the notice and any other notice that relates to the same security
interest in the registry of deeds.

            (10)    The debtor named in a notice registered pursuant to subsection (3) or (7), and
any person with a registered interest in the land to which the notice relates, may give a written
demand to the secured party if

                (a) all of the obligations under the security agreement to which the notice
            relates have been performed;

                (b) the secured party has agreed to release part or all of the collateral
            described in the notice;

                (c) the description of the collateral contained in the notice includes an item
            or kind of property that is not collateral under a security agreement between the
            secured party and the debtor; or

                (d) no security agreement exists between the secured party and the debtor.

            (11)    A demand pursuant to subsection (10) may require that the secured party,
within thirty days after the demand is given, submit for registration a notice pursuant to
subsection (6)

                (a) discharging the registration of the notice, in a case within clause
            (10)(a) or (d);

                (b) amending or discharging the registration of the notice to reflect the
            terms of the agreement, in a case within clause (10)(b); or

                (c) amending the collateral description in the notice to exclude items or
            kinds of property that are not collateral under a security agreement between the
            secured party and the debtor, in a case within clause (10)(c).

            (12)    Where a secured party fails to comply with a demand made pursuant to
subsection (10) within thirty days after it is given, or fails to give to the person giving the demand
an order of the Court confirming that the registration need not be amended or discharged, the
person making the demand may submit for registration the notice referred to in subsection (11)
and the registrar shall register the notice.

            (13)    A demand pursuant to subsection (10) may be given in accordance with
Section 70 or by registered mail addressed to the address of the secured party as it appears on
the most recent notice registered pursuant to subsection (3) or (7).

            (14)    On application by the secured party, the Court may order that the registration

                (a) be maintained on any condition, and subject to Section 45, for any
            period of time; or

                (b) be discharged or amended.

            (15)    Subsection (12) does not apply to a registration of a notice of a security
interest provided for in a trust indenture if the notice states that the security agreement providing
for the security interest is a trust indenture.

            (16)    In a case within subsection (15), where the secured party fails to comply with
a demand made pursuant to subsection (10) within fifteen days after it is made, the person
making the demand may apply to the Court for an order directing that the registration be
amended or discharged.

            (17)    No fee or expense shall be charged by a secured party for compliance with
a demand made pursuant to subsection (10) unless the charge was agreed to by the parties
before the demand was given.


         51 (1) In this Section,

                (a) "debtor" includes any person named as a debtor in a registered
            financing statement;

                (b) "secured party" includes any person named as a secured party in a
            registered financing statement.

            (2) Where a registration relates exclusively to a security interest in consumer
goods, the secured party shall discharge the registration within thirty days after all obligations
under the security agreement creating the security interest are performed, unless the registration
lapses before the expiry of that thirty-day period.

            (3) The debtor, or any person with an interest in property that falls within the
collateral description included in a registered financing statement, may make a written demand
to the secured party if

                (a) all of the obligations under the security agreement to which the
            financing statement relates have been performed;

                (b) the secured party has agreed to release part or all of the collateral
            described in the collateral description included in the financing statement;

                (c) the collateral described in the collateral description included in the
            financing statement includes an item or kind of property that is not collateral under
            a security agreement between the secured party and the debtor; or

                (d) no security agreement exists between the secured party and the debtor.

            (4) A demand made pursuant to subsection (3) may require that the secured
party, within fifteen days after the demand is made, register a financing change statement

                (a) discharging the registration in a case within clause (3)(a) or (d);

                (b) amending or discharging the registration so as to reflect the terms of
            the agreement in a case within clause (3)(b); or

                (c) amending the collateral description to exclude items or kinds of
            property that are not collateral under a security agreement between the secured
            party and the debtor in a case within clause (3)(c).

            (5) Where a secured party fails to comply with a demand made pursuant to
subsection (3) within fifteen days after it is made, or fails to give to the person making the
demand an order of the Court confirming that the registration need not be amended or dis-
charged, the person making the demand may register the financing change statement referred
to in subsection (4).

            (6) A demand made pursuant to subsection (3) may be given in accordance with
Section 70 or by registered mail addressed to the address of the secured party that was
registered as part of the financing statement.

            (7) On application by the secured party, the Court may order that the registration

                (a) be maintained on any condition, and subject to Section 45, for any
            period of time; or

                (b) be discharged or amended.

            (8) Subsection (5) does not apply to the registration of a security interest provided
for in a trust indenture if the registration discloses that the security agreement providing for the
security interest is a trust indenture.

            (9) In a case within subsection (8), where the secured party fails to comply with
a demand made pursuant to subsection (3) within fifteen days after it is made, the person making
the demand may apply to the Court for an order directing that the registration be amended or
discharged.

            (10)    No fee or expense shall be charged by a secured party for compliance with
a demand made pursuant to subsection (3) unless the charge was agreed to by the parties before
the demand was given.


         52 (1) Where a security interest is perfected by registration and the debtor transfers
all or part of the debtor's interest in the collateral with the prior consent of the secured party,
the security interest in the transferred collateral is subordinate to

                (a) an interest, other than a security interest in the transferred collateral,
            arising in the period from the expiry of the fifteenth day after the transfer to the time
            the secured party amends the registration to disclose the name of the transferee of
            the interest in the collateral as the new debtor or takes possession of the collateral;

                (b) a perfected security interest in the transferred collateral that is
            registered or perfected during the period referred to in clause (a); and

                (c) a perfected security interest in the transferred collateral that is
            registered or perfected after the transfer and before the expiry of the fifteenth day
            after the transfer if, before the expiry of the fifteen days,

                    (i) the registration of the security interest first referred to in this
                subsection is not amended to disclose the transferee of the interest in the
                collateral as the new debtor, or

                    (ii)    the secured party does not take possession of the collateral.

            (2) Where a security interest is perfected by registration and the secured party
has knowledge of

                (a) information required to register a financing change statement
            disclosing the transferee as the new debtor, where all or part of the debtor's interest
            in the collateral is transferred; or

                (b) the new name of the debtor, if there has been a change in the debtor's
            name,

the security interest, in the transferred collateral where clause (a) applies, and in the collateral
where clause (b) applies, is subordinate to

                (c) an interest, other than a security interest, in that collateral, arising in
            the period from the expiry of the fifteenth day after the secured party has knowledge
            of the information referred to in clause (a) or the new name of the debtor to the time
            the secured party amends the registration to disclose the name of the transferee as
            the debtor or to disclose the new name of the debtor, or takes possession of the
            collateral;

                (d) a perfected security interest in the collateral that is registered or
            perfected in the period referred to in clause (c); and

                (e) a perfected security interest in the collateral that is registered or
            perfected after the secured party had knowledge of the information referred to in
            clause (a) or the new name of the debtor and before the expiry of the fifteenth day
            referred to in clause (c), if, before the expiry of the fifteen days,

                    (i) the registration of the security interest first referred to in this
                subsection is not amended to disclose the transferee of the collateral as the
                new debtor or to disclose the new name of the debtor, or

                    (ii)    the secured party does not take possession of the collateral.

            (3) This Section does not have the effect of subordinating a prior security interest
deemed by Section 75 to be registered pursuant to this Act.

            (4) Where the debtor's interest in part or all of the collateral is transferred by the
debtor without the consent of the secured party and there are one or more subsequent transfers
of the collateral without the consent of the secured party before the secured party acquires
knowledge of the name of the most recent transferee of the collateral, the secured party shall be
deemed to have complied with subsection (2) if the secured party registers a financing change
statement not later than fifteen days after acquiring knowledge of

                (a) the name of the most recent transferee of the collateral; and

                (b) the information required to register a financing change statement,

and the secured party need not register financing change statements with respect to any
intermediate transferee.


         53 (1) A person may bring action against Her Majesty in right of the Province to
recover loss or damage suffered by that person because of an error or omission in the operation
of the Registry if the loss or damage resulted from reliance on a printed search result issued by
the Registry.

            (2) Her Majesty in right of the Province is not liable directly or vicariously for
loss or damage suffered by a person because of

                (a) verbal advice given by the Registrar, a deputy registrar or an officer,
            employee or agent respecting this Act or the regulations or any other Act that
            provides for registration in the Registry or the regulations pursuant to that Act or
            the operation of the Registry unless the person bringing the action proves that the
            Registrar, deputy registrar, officer, employee or agent was not acting in good faith;
            or

                (b) the failure of the Registry to effect a registration or to effect a
            registration correctly.

            (3) No action for damages under this Section or Section 54 lies against Her
Majesty in right of the Province unless it is commenced within

                (a) two years after the person entitled to bring the action first had
            knowledge of the loss or damage; or

                (b) ten years after the date the printed search result was issued,

whichever is earlier.

            (4) Notwithstanding the Proceedings Against the Crown Act, no action may be
brought against Her Majesty in right of the Province, the Registrar, a deputy registrar or an
officer, employee or agent of the Registry for any error or omission of the Registrar, deputy
registrar, officer, employee or agent of the Registry in respect of the discharge or purported
discharge of any duty or function under this Act or the regulations or any other Act or the
regulations pursuant to that Act, except as provided in this Section and in Section 54.


         54 (1) An action for recovery of damages pursuant to Section 53 brought by a trustee
under a trust indenture or by a person with an interest in a trust indenture shall be brought on
behalf of all persons with interests in the same trust indenture, and the judgment in the action,
except to the extent that it provides for a subsequent determination of the amount of damages
suffered by each person, constitutes a judgment between each person and Her Majesty in right
of the Province in respect of each error or omission.

            (2) In an action brought by a trustee under a trust indenture or by a person with
an interest in a trust indenture, proof that each person relied on the search result is not
necessary if it is established that the trustee relied on the search result, but no person is entitled
to recover damages under this Section if the person knows at the time of acquisition of an interest
in the collateral that the search result relied upon by the trustee is incorrect.

            (3) In proceedings under this Section, the Court may make any order that it
considers appropriate in order to give notice to the persons with an interest in the same trust
indenture.

            (4) Subject to subsection 55(1), the Court may order payment of all or a portion
of the damages awarded to identified persons with interests in the same trust indenture at any
time after judgment, and the obligation of Her Majesty in right of the Province to satisfy the
judgment is satisfied to the extent that payment is so made.


         55 (1) The total amount recoverable in a single action pursuant to Section 53, and
the total amount recoverable for all claims in a single action pursuant to Section 54, shall not
exceed the amounts prescribed.

            (2) Where damages are paid to a claimant under this Section, Her Majesty in
right of the Province is subrogated to the rights of the claimant against any person indebted to
the claimant whose debt to the claimant was the basis of the loss or damage in respect of which
the claim was paid.

            (3) Where the amount of the damages paid to a claimant is less than the value of
the interest the claimant would have had if the error or omission had not occurred, the right of
subrogation under subsection (2) does not prejudice the right of the claimant to recover in
priority to Her Majesty in right of the Province an amount equal to the difference between the
amount paid to the claimant and the value of the interest the claimant would have had if the error
or omission had not occurred.

            (4) The Minister of Finance may, without action being brought, pay out of the
Consolidated Fund of the Province, the amount of a claim against Her Majesty in right of the
Province when furnished with a report of the Registrar setting forth the facts and the opinion of
the Registrar that the claim is just and reasonable.

            (5) Where an award of damages has been made in favour of a claimant and the
time for appeal has expired, or when an appeal is taken and is disposed of, in whole or in part,
in favour of the claimant, the Minister of Finance shall authorize payment out of the
Consolidated Fund of the Province, subject to subsection (1), of the amount specified in the
judgment in the manner specified in the judgment, including the costs of the claimant if the
judgment so provides.


                            PART V

                 DEFAULT RIGHTS AND REMEDIES

         56 (1) This Part does not apply to

                (a) a transaction referred to in subsection 4(2); or

                (b) a transaction between a pledgor and a pawnbroker.

            (2) In this Section, "secured party" includes a receiver.

            (3) The rights and remedies in this Part are cumulative.

            (4) Subject to any other Act or rule of law to the contrary, where the same
obligation is secured by an interest in land and by a security interest to which this Act applies,
the secured party may

                (a) proceed pursuant to this Part as to the personal property; or

                (b) proceed as to both the land and the personal property in which case the
            secured party shall proceed as against the personal property in accordance with the
            secured party's rights, remedies and obligations in respect of the land, as if the
            personal property were land, and this Part, except for subsections 59(3) to (7), does
            not apply.

            (5) Clause (4)(b) does not limit the rights of a secured party who has a security
interest in the personal property taken before or after the security interest referred to in
subsection (4).

            (6) A secured party referred to in subsection (5)

                (a) has standing in proceedings taken pursuant to clause (4)(b); and

                (b) may apply to the Court for the conduct of a judicially supervised sale
            pursuant to clause (4)(b).

            (7) For the purpose of distributing the proceeds realized from the sale of both
land and personal property where the purchase price is not allocated to each separately, the
amount that is attributable to the sale of the personal property is that proportion of the total
proceeds that the market value of the personal property at the time of the sale bears to the
market value of the land and the personal property at the time of the sale.

            (8) A security interest does not merge merely because a secured party has
reduced the claim to judgment.


         57 (1) In this Section, "secured party" includes a receiver.

            (2) Subject to subsection (4), where the debtor is in default under a security
agreement, the secured party has against the debtor only

                (a) the rights and remedies provided in the security agreement;

                (b) the rights and remedies provided in this Part and Sections 37, 38 and
            39; and

                (c) when in possession of the collateral, the rights and remedies provided
            in Section 18.

            (3) Subject to subsection (4), where the debtor is in default under a security
agreement, the debtor has against the secured party the rights and remedies provided

                (a) in the security agreement;

                (b) by any other Act or rule of law not inconsistent with this Act; and

                (c) in this Part and in Section 18.

            (4) Except as provided in Sections 18, 60, 61 and 63, no provision of Section 18
or Sections 58 to 67, to the extent that the provision gives rights and remedies to the debtor or
imposes obligations on the secured party, can be waived or varied by agreement or otherwise.


         58 (1) In this Section, "secured party" includes a receiver.

            (2) Where the debtor is in default under a security agreement, the secured party
may

                (a) notify a debtor on an intangible or chattel paper or an obligor on an
            instrument or security to make payment to the secured party whether or not the
            assignor was making collections on the collateral before the notification;

                (b) apply any money taken as collateral or paid to the secured party
            pursuant to clause (a) to the satisfaction of the obligation secured by the security
            interest; and

                (c) subject to Section 60, take control of any proceeds to which the secured
            party is entitled under Section 29.

            (3) A secured party who enforces a security interest by giving notice in
accordance with clause (2)(a) shall notify the debtor within fifteen days after doing so.

            (4) A secured party may deduct reasonable collection expenses from

                (a) amounts collected from a debtor on an intangible or chattel paper or
            from an obligor under an instrument; or

                (b) money held as collateral.


         59 (1) In this Section,

                (a) "dependant" means a person living with a debtor who is wholly or
            substantially dependent on the debtor for financial support;

                (b) "secured party" includes a receiver.

            (2) Subject to subsections (3) to (7), Sections 37, 38 and 39, the Bankruptcy and
Insolvency Act (Canada) and any other Act or rule of law requiring a secured party to give prior
notice of the intention to enforce a security interest, if the debtor is in default under a security
agreement,

                (a) the secured party has, unless otherwise agreed, the right to take
            possession of the collateral or otherwise enforce the security interest by any method
            permitted by law;

                (b) the secured party may, if the collateral is goods of a kind that cannot
            be readily moved from the debtor's premises or of a kind for which adequate
            storage facilities are not readily available, seize or repossess the collateral without
            removing it from the debtor's premises in any manner by which a sheriff acting
            under an execution order may seize without removal, if the secured party's interest
            is perfected by registration pursuant to Section 26;

                (c) the secured party may, if clause (b) applies, dispose of the collateral
            on the debtor's premises but shall not cause the person in possession of the
            premises any greater inconvenience and cost than is necessarily incidental to the
            disposal; and

                (d) the secured party may, if the collateral is a document of title, proceed
            either as to the document of title or as to the goods covered by it, and any method
            of enforcement that is available with respect to the document of title is also
            available, with the necessary modifications, with respect to the goods covered by it.

            (3) Subject to subsection (7), a debtor may claim the following items of collateral
to be exempt from seizure by a secured party:

                (a) furniture, household furnishings and appliances used by the debtor or
            a dependent to a realizable value of five thousand dollars or to any greater amount
            that may be prescribed;

                (b) one motor vehicle having a realizable value of not more than six
            thousand five hundred dollars at the time the claim for exemption is made, or not
            more than any greater amount that may be prescribed, if the motor vehicle is
            required by the debtor in the course of or to retain employment or in the course of
            and necessary to the debtor's trade, profession or occupation or for transportation
            to a place of employment where public transportation facilities are not reasonably
            available;

                (c) medical or health aids necessary to enable the debtor or a dependent
            to work or to sustain health;

                (d) consumer goods in the possession and use of the debtor or a dependent
            if, on application, the Court determines that

                    (i) the loss of the consumer goods would cause serious hardship to
                the debtor or dependent, or

                    (ii)    the costs of seizing and selling the goods would be
                disproportionate to the value that would be realized.

            (4) A dependant may claim an item of collateral within clause (3)(a), (c) or (d)
to be exempt from seizure but a claim may not be made by both a debtor and a dependant with
respect to an item of the same kind.

            (5) Where a claim for exemption is made pursuant to clause (3)(a) or (b) and the
realizable value of the collateral for which the claim is made exceeds the maximum amount of
the exemption specified in those clauses, the secured party may seize the collateral.

            (6) A secured party who seizes collateral in the circumstances referred to in
subsection (5) shall dispose of it in accordance with Section 60 and shall pay to the debtor an
amount equivalent to the maximum amount of the exemption, whether or not the proceeds of the
disposition exceed that maximum amount.

            (7) Clauses (3)(a) to (c) and subsections (4), (5) and (6) do not apply in relation
to goods that are subject to a purchase money security interest held by the secured party against
whom the claim to exemption is made.


         60 (1) In subsections (2), (7) and (15), "secured party" includes a receiver.

            (2) After seizing or repossessing the collateral, a secured party may dispose of
it in its existing condition or after repair, processing or preparation for disposition.

            (3) The proceeds of the disposition of collateral shall be applied consecutively to

                (a) the reasonable expenses of seizing, repossessing, holding, repairing,
            processing or preparing for disposition and disposing of the collateral and any
            other reasonable expenses incurred by the secured party; and

                (b) the satisfaction of the obligations secured by the security interest of the
            party making the disposition.

            (4) Any surplus proceeds of the disposition of collateral shall be dealt with in
accordance with Section 61.

            (5) Collateral may be disposed of

                (a) by private sale;

                (b) by public sale, including public auction or closed tender;

                (c) as a whole or in commercial units or parts; or

                (d) if the security agreement so provides, by lease.

            (6) Where the security agreement so provides, the payment for the collateral
being disposed of may be deferred.

            (7) The secured party may delay disposition of the collateral, in whole or in part.

            (8) Not less than twenty days before disposition of the collateral, the secured
party shall give a notice to

                (a) the debtor and any other person who is known by the secured party to
            be an owner of the collateral;

                (b) each 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 disposition 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) each judgment creditor whose interest in the collateral is subordinate
            to that of the secured party and who has registered, before the notice of disposition
            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 in the collateral before
            the notice of disposition is given to the debtor.

            (9) A notice pursuant to subsection (8) shall contain

                (a) a description of the collateral;

                (b) a statement of the amount required to satisfy the obligation secured by
            the security interest;

                (c) a statement of the sum actually in arrears, exclusive of the operation
            of an acceleration clause in the security agreement;

                (d) a brief description of any default, other than non-payment, including
            the term of the security agreement, the breach of which constituted the default;

                (e) a statement of the amount of the expenses referred to in clause (3)(a)
            or, where the amount has not been determined, a reasonable estimate;

                (f) a statement that any person entitled to receive the notice may redeem
            the collateral on payment of the amount due under clauses (b) and (e);

                (g) a statement that the debtor may reinstate the security agreement on
            payment of the sum actually in arrears exclusive of the operation of an acceleration
            clause in the security agreement, the curing of any other default and payment of the
            amount of the expenses due under clause (3)(a);

                (h) a statement that the collateral will be disposed of and the debtor may
            be liable for a deficiency unless the collateral is redeemed or the security agreement
            is reinstated; and

                (i) a statement of the date, time and place of any sale by public auction,
            or the place to which closed tenders may be delivered and the date after which
            closed tenders will not be accepted, or the date after which any private disposition
            of the collateral is to be made.

            (10)    Where a notice pursuant to subsection (8) is given to a person other than the
debtor, it need not contain the information in clauses (9)(c), (g) and (h) and, where the debtor
is not entitled to reinstate the security agreement, the notice to the debtor need not contain the
information in clauses (9)(c) and (g).

            (11)    Not less than twenty days before the disposition of the collateral, a receiver
shall give a notice to

                (a) the debtor and, where the debtor is a body corporate, a director of the
            body corporate;

                (b) any other person who is known by the secured party to be an owner of
            the collateral;

                (c) a person referred to in clause (8)(b);

                (d) a creditor referred to in clause (8)(c); and

                (e) any other person with an interest in the collateral who has given a
            written notice to the receiver of that person's interest in the collateral before the
            notice of disposition is given to the debtor.

            (12)    A notice pursuant to subsection (11) shall contain

                (a) a description of the collateral;

                (b) a statement that the collateral will be disposed of unless it is redeemed;
            and

                (c) a statement of the date, time and place of any sale by public auction,
            or the place to which closed tenders may be delivered and the date after which
            closed tenders will not be accepted, or the date after which any private disposition
            of the collateral is to be made.

            (13)    A notice pursuant to subsection (8) or (11) may be given in accordance with
Section 70 or, where it 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.

            (14)    The secured party may purchase the collateral or any part of it but only at
public sale, including public auction or closed tender, and only for a price that bears a
reasonable relationship to the market value of the collateral.

            (15)    Where 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;

                (b) an interest subordinate to that of the debtor; and

                (c) an interest subordinate to that of the secured party,

and all obligations secured by the subordinate interests is deemed to be performed for the
purpose of Sections 50 and 51.

            (16)    Subsection (15) does not affect the rights of a person with a security interest
that is deemed by Section 75 to be registered pursuant to this Act if the person has not been given
a notice pursuant to this Section.

            (17)    A person who is liable to a secured party under a guarantee, endorsement,
covenant, repurchase agreement or the like and who receives a transfer of collateral from the
secured party or who is subrogated to the rights of the secured party has thereafter the rights
and duties of the secured party, and the transfer of collateral is not a disposition of the
collateral.

            (18)    Notice under subsection (8) or (11) need not be given if

                (a) the collateral is perishable;

                (b) the secured party believes on reasonable grounds that the collateral
            will decline substantially in value if not disposed of immediately after default;

                (c) the cost of care and storage of the collateral is disproportionately large
            relative to its value;

                (d) the collateral is of a type that is customarily sold on an organized
            market that handles large volumes of transactions between many different sellers
            and many different buyers;

                (e) the collateral is money, other than a medium of exchange authorized
            by the Parliament of Canada as part of the currency of Canada;

                (f) for any other reason, the Court, on an application made without notice
            to any other person, is satisfied that a notice is not required; or

                (g) after default, every person entitled to receive a notice of disposition
            under subsection (8) or (11) consents in writing to the immediate disposition of the
            collateral.


         61 (1) In this Section, "secured party" includes a receiver.

            (2) Where a security agreement secures an indebtedness and the secured party
has dealt with the collateral pursuant to Section 58, or has disposed of it, the secured party shall
account for any surplus and shall, subject to subsection (5) or the agreement otherwise of all
interested persons, pay any surplus in the following order to

                (a) 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 distribution of the surplus, 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;

                (b) a judgment creditor whose interest in the collateral is subordinate to
            that of the secured party and who has registered, before the distribution of the
            surplus, 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;

                (c) any other person with an interest in the surplus who has given a written
            notice to the secured party of that person's interest before the distribution of the
            surplus; and

                (d) the debtor and any other person who is known by the secured party to
            be an owner of the collateral.

            (3) The priority of the claim of any person referred to in subsection (2) is not
prejudiced by payment to anyone in accordance with that subsection.

            (4) Within thirty days after receipt of a written request for an accounting from a
person referred to in subsection (2), the secured party shall give to that person a written
accounting of

                (a) the amount received from the disposition of any collateral or any
            amount collected under Section 58;

                (b) the manner in which the collateral was disposed of;

                (c) the amount of expenses as provided in clauses 18(3)(a) and 60(3)(a)
            and subsection 58(4);

                (d) the distribution of the amount received from the disposition or
            collection; and

                (e) the amount of any surplus.

            (5) Where there is a question as to who is entitled to receive payment under
subsection (2), the secured party may pay the surplus into the Court and the surplus shall not
be paid out except on an application pursuant to Section 68 by a person claiming an entitlement
to it.

            (6) Unless otherwise agreed, or unless otherwise provided in this or any other
Act, the debtor is liable to pay any deficiency to the secured party.


         62 (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.

            (2) Where 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.

            (3) Subject to subsections (6) and (7), where a notice of objection is given
pursuant to subsection (2), the secured party shall dispose of the collateral pursuant to Section
60.

            (4) Where no notice of objection is given pursuant to subsection (2), the secured
party

                (a) is 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) may hold or dispose of the collateral free from all rights and interests
            of the debtor and any person entitled to receive a notice under clause (1)(b), (c) or
            (d) who has been given the notice,

and all obligations secured by such interests are deemed to have been performed for the purpose
of Sections 50 and 51.

            (5) A notice of a proposal pursuant to subsection (1) and a notice of objection
pursuant to subsection (2) may be given in accordance with Section 70 or, where 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.

            (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.

            (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 clause
            60(3)(a).

            (8) Where 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 are deemed to have been performed for
the purpose of Sections 50 and 51.

            (9) Subsection (8) does not affect the rights of a person with a security interest
that is deemed by Section 75 to be registered pursuant to this Act if the person has not been given
a notice pursuant to subsection (1).


         63 (1) In subsection (2), "secured party" includes a receiver.

            (2) At any time before the secured party has disposed of the collateral or
contracted for its disposition pursuant to Section 60, or before the secured party is deemed to
have irrevocably elected to retain the collateral under Section 62, any person entitled to receive
a notice of disposition under subsection 60(8) or (11) may redeem the collateral, unless that
person has otherwise agreed in writing after default, by tendering fulfillment of the obligations
secured by the security interest, together with a sum equal to the reasonable expenses referred
to in clause 60(3)(a) to the extent that such expenses have actually been incurred by the secured
party.

            (3) Where more than one person elects to redeem pursuant to subsection (2), the
priority of their rights to redeem is the same as the priority of their respective interests.

            (4) At any time before the secured party has disposed of the collateral or
contracted for its disposition pursuant to Section 60, or before the secured party is deemed to
have irrevocably elected to retain the collateral pursuant to Section 62, the debtor, other than
a guarantor or indemnitor, may reinstate the security agreement, unless the debtor has otherwise
agreed in writing after default, by

                (a) paying the sum actually in arrears, exclusive of the operation of an
            acceleration clause in the security agreement;

                (b) curing any other default by reason of which the secured party intends
            to dispose of the collateral; and

            (c) paying a sum equal to the reasonable expenses referred to in clause 60(3)(a)
         to the extent that such expenses have actually been incurred by the secured party.

            (5) Unless otherwise agreed, the debtor may not reinstate a security agreement

                (a) more than twice, if the security agreement provides for payment in full
            by the debtor within twelve months after value was given by the secured party; or

                (b) more than twice each year, if the security agreement provides for
            payment by the debtor during a period of time of more than one year after value was
            given by the secured party.


         64 (1) In this Section, "secured party" includes a receiver.

            (2) On application by a debtor, a creditor of a debtor, a secured party, a sheriff
or any person with an interest in the collateral, the Court may

                (a) make any order, including a binding declaration of a right and
            injunctive relief, that is necessary to ensure compliance with this Part or Sections 
            18, 37, 38 and 39;

                (b) give directions to any person regarding the exercise of rights or the
            discharge of obligations under this Part or Sections 18, 37, 38 and 39;

                (c) relieve a person from compliance with the requirements of this Part or
            Sections 18, 37, 38 and 39;

                (d) stay enforcement of rights provided in this Part or Sections 18, 37, 38
            and 39; or

                (e) make any order necessary to ensure protection of the collateral or of
            the interest of any person in the collateral.


         65 (1) A security agreement may provide for the appointment of a receiver and,
except as provided in this or any other Act, may provide for the receiver's rights and duties.

            (2) A receiver shall

                (a) take custody and control of the collateral in accordance with the
            security agreement or order under which the receiver was appointed, but unless
            appointed a receiver-manager or unless the Court orders otherwise, shall not carry
            on the business of the debtor;

                (b) as soon as possible and not later than ten days after becoming a
            receiver, register a notice in the Registry in accordance with the regulations
            disclosing the appointment and specifying an office in the Province where the
            records referred to in clause (d) shall be maintained;

                (c) open and maintain, in the receiver's name as receiver, one or more
            accounts at a bank, credit union or similar financial institution for the deposit of all
            money coming under the receiver's control as receiver;

                (d) keep records, in accordance with accepted accounting practices, of all
            receipts, expenditures and transactions involving collateral or other property of the
            debtor;

                (e) unless a different interim period is ordered by the Court, prepare at
            least once in every six-month period after the date of the appointment financial
            statements of the receivership administration;

                (f) indicate on every business letter, invoice, contract or similar document
            used or executed in connection with the receivership that the receiver is acting as
            a receiver;

                (g) on completion of the receiver's duties as receiver, prepare a final
            report and final statements of the financial accounts of the receivership
            administration and send copies immediately to the debtor and, if the debtor is a
            body corporate, to the directors of the debtor; and

                (h) on termination of the receivership, discharge the registration made
            pursuant to clause (b).

            (3) The debtor and, where the debtor is a body corporate, a director of the debtor,
or the authorized representative of any of them, may require the receiver, by a demand in writing
delivered to the receiver, to make available for inspection the records referred to in clause (2)(d)
during regular business hours at the office of the receiver specified in accordance with clause
(2)(b).

            (4) The debtor and, where the debtor is a body corporate, a director of the debtor,
a sheriff, a person with an interest in the collateral in the custody or control of the receiver, or
the authorized representative of any of them, may require the receiver, by a demand in writing
delivered to the receiver, to provide copies of the financial statements referred to in clause (2)(e)
or the final report and final statements of the financial accounts referred to in clause (2)(g) or
to make them available for inspection during regular business hours at the office of the receiver
specified in accordance with clause (2)(b).

            (5) The receiver shall comply with a demand made pursuant to subsection (3) or
(4) within ten days after receipt of the demand.

            (6) The receiver may require the payment in advance of a fee in the amount
prescribed for each demand, but the sheriff and the debtor or, where the debtor is a body
corporate, a director of the debtor, are entitled to inspect or to receive a copy of the financial
statements and final account without charge.

            (7) On application by an interested person, the Court may

                (a) appoint a receiver;

                (b) remove, replace or discharge a receiver, whether appointed by the
            Court or in accordance with a security agreement;

                (c) give directions on any matter relating to the duties of a receiver;

                (d) approve the accounts and fix the remuneration of a receiver;

                (e) make an order requiring a receiver or a person by or on behalf of
            whom the receiver is appointed to make good a default in connection with the
            receiver's custody, management or disposition of the collateral of the debtor or to
            relieve the person from any default on such terms as the Court thinks fit,
            notwithstanding anything contained in a security agreement or other document
            providing for the appointment of a receiver;

                (f) exercise with respect to receivers appointed in accordance with a
            security agreement the jurisdiction that it has over receivers appointed by the Court.

            (8) The powers referred to in subsection (7) and in Section 64 are in addition to
any other powers the Court may exercise in its jurisdiction over receivers.

            (9) Unless the Court orders otherwise, a receiver is required to comply with
Sections 60 and 61 only when the receiver deals with or disposes of the collateral other than in
the course of operating the business of a debtor.


                           PART VI

                  GENERAL AND MISCELLANEOUS

         66 (1) The principles of the common law, equity and the law merchant, except in so
far as they are inconsistent with this Act, supplement this Act and continue to apply.

            (2) All rights and obligations arising under this Act, any other applicable law or
a security agreement shall be exercised and discharged in good faith and in a commercially
reasonable manner.

            (3) A person does not act in bad faith merely because that person acts with
knowledge of the interest of some other person.


         67 (1) In this Section, "secured party" includes a receiver.

            (2) Where a person fails, without reasonable excuse, to discharge any obligations
imposed on that person by this Act, the person to whom the obligation is owed has the right to
recover any loss or damage that was reasonably foreseeable as liable to result from the failure.

            (3) Where a secured party fails, without reasonable excuse, to comply with
obligations

                (a) in subsection 44(11) or Section 50 or 51; or

                (b) in Section 18, 19, 60, 61 or 62 and the collateral is consumer goods,

the debtor, or, in a case of non-compliance with subsection 44(11) or Section 50 or 51, the
person named as debtor in a financing statement, is deemed to have suffered damages not less
than the amount prescribed.

            (4) Where a debtor or other person with an interest in land or collateral causes
the registration of a notice referred to in subsection 50(12) or registers a financing statement
referred to in subsection 51(5) without authority under those subsections and without reasonable
excuse, the secured party referred to in those subsections is deemed to have suffered damages
not less than the amount prescribed.

            (5) In an action for a deficiency, the debtor may raise as a defence the failure of
the secured party to comply with obligations in Section 18, 19, 60 or 61, but non-compliance
limits the right to the deficiency only to the extent that it has affected the debtor's ability to
protect the debtor's interest in the collateral or has made the accurate determination of the
deficiency impracticable.

            (6) Where a secured party fails to comply with obligations in Section 18, 19, 60
or 61, the onus is on the secured party to show that the failure

                (a) did not affect the debtor's ability to protect the debtor's interest in the
            collateral by redemption or reinstatement of the security agreement, or otherwise,
            if the collateral is consumer goods; and

                (b) did not make the accurate determination of the deficiency
            impracticable.

            (7) Except as otherwise provided in this Act, a provision in a security agreement
or any other agreement is void if it purports to exclude an obligation or an onus imposed by this
Act or purports to limit the liability of or the amount of damages recoverable from a person who
has failed to discharge an obligation imposed by this Act.


         68 On application by an interested person, the Court may make an order

            (a) determining questions of priority or entitlement to collateral;

            (b) directing an action to be brought or an issue to be tried;

            (c) extending or abridging, conditionally or otherwise, the time periods for
         compliance specified in Section 12, subsections 37(18), 39(16) and 44(11) or in Part V.


         69 An appeal lies to the Nova Scotia Court of Appeal from an order, judgment or
direction of the Court made pursuant to this Act.


         70 (1) A verification statement pursuant to subsection 44(11) and a notice or a
demand given pursuant to this Act, other than a demand pursuant to Section 19, may be given
to

                (a) an individual, by leaving it with the individual or by sending it by
            registered mail addressed to

                    (i) the individual by name at the individual's residence, or

                    (ii)    where the individual is the sole proprietor of a business, the
                individual by name at the address of the business;

                (b) a partnership by

                    (i) leaving it with

                        (A) one or more of the partners or, where the partnership is
                    a limited partnership, one or more of the general partners, or

                        (B) any person who has control or management of the
                    partnership business when the notice or demand is delivered, or

                    (ii)    sending it by registered mail addressed to

                        (A) the partnership,

                        (B) one or more of the partners or, where the partnership is
                    a limited partnership, one or more of the general partners, or

                        (C) any person who has control or management of the
                    partnership business when the notice or demand is given,

                at the address of the partnership business;

                (c) a body corporate, other than a municipality, by

                    (i) leaving it with an officer or director of the body corporate or
                person in charge of any office or place of business of the body corporate, or

                    (ii)    leaving it, or sending it by registered mail addressed to the body
                corporate, at its registered or head office,

                (d) a municipality by

                    (i) leaving it with the mayor, deputy mayor, warden, deputy warden,
                clerk or any solicitor of the municipality, or

                    (ii)    sending it by registered mail addressed to the municipality, or
                to the mayor, deputy mayor, warden, deputy warden, clerk or any solicitor
                of the municipality, at the principal office of the municipality;

                (e) an unincorporated association by

                    (i) leaving it with an officer of the association or person in charge
                of any office or premises occupied by the association, or

                    (ii)    sending it by registered mail addressed to an officer of the
                association at the address of the officer; and

                (f) Her Majesty in right of the Province in accordance with the
            Proceedings Against the Crown Act.

            (2) A notice or demand sent by registered mail is deemed to be given

                (a) when the addressee actually receives the notice or demand; or

                (b) except when postal services are not functioning, on the expiry of ten
            days after the date of registration,

whichever is earlier.


         71 (1) Where there is a conflict between a provision of this Act and a provision for
the protection of consumers in any other Act, the provision of that Act prevails.

            (2) Except as otherwise provided in this or any other Act, where there is a conflict
between a provision of this Act and a provision of any other Act other than an Act for the
protection of consumers, the provision of this Act prevails.


         72 (1) The Governor in Council may make regulations

                (a) prescribing the kinds of goods the leases of which are not within the
            scope of this Act;

                (b) prescribing duties and powers of the Registrar;

                (c) respecting the Registry and its operation, including the location and
            hours of the offices of the Registry;

                (d) respecting any matters relating to fees payable in relation to
            registrations, searches or any other matter under this Act or the regulations,
            including the amount of the fees and their manner of payment;

                (e) respecting the data to be entered in the Registry to effect, renew,
            discharge or otherwise amend a registration authorized by this Act and any other
            matters relating to registrations under this Act;

                (f) respecting the data to be entered in the Registry to effect, renew,
            discharge or otherwise amend the registration of interests or notices authorized by
            any other Act to be registered in the Registry and any other matters relating to those
            interests or notices and their registration, including the application of any provision
            of this Act or the regulations;

                (g) respecting the form, content and manner of use of notices under this
            Act, including notices authorized to be registered in a registry of deeds by Section
            50;

                (h) respecting the description of collateral, including proceeds collateral,
            that is to be included in financing statements and financing change statements and
            prescribing the kinds of goods that may be described in part by serial number and
            the kinds of goods that must be described in part by serial number and the
            requirements of a description by serial number;

                (i) respecting the time, place and all other matters relating to searches of
            the records of the Registry, including the method of disclosure and the form of
            search results;

                (j) respecting any matters relating to the form, use and manner of
            obtaining or sending printed or electronic verification statements or notices of a
            registration;

                (k) prescribing abbreviations, expansions or symbols that may be used in
            search results and in financing statements, financing change statements or other
            data authorized by this Act or the regulations to be entered in the Registry to effect
            a registration;

                (l) respecting the length of time during which a registration is to be
            effective and the manner in which the period of time is to be specified;

                (m) respecting re-registrations pursuant to subsection 36(7);

                (n) prescribing, for the purpose of subsection 55(1), the maximum total
            amount recoverable in a single action pursuant to Section 53 and the maximum
            total amount recoverable for all claims in a single action pursuant to Section 54;

                (o) prescribing amounts for the purpose of subsections 19(16), 65(6), 67(3)
            and (4);

                (p) respecting any matter relating to an agreement entered into by the
            Registrar pursuant to subsection 44(2) including the rights and obligations of the
            parties to such an agreement;

                (q) respecting forms for the purpose of this Act and the regulations;

                (r) prescribing any matter required or authorized by this Act to be
            prescribed;

                (s) defining any word or expression used in this Act and not defined in this
            Act, and redefining, for the purpose of the registration of interests or notices
            authorized by any other Act to be registered in the Registry, any word or expression
            defined in this Act;

                (t) respecting any matter or thing the Governor in Council considers
            necessary or advisable to carrry out effectively the intent and purpose of this Act.

            (2) A regulation made pursuant to subsection (1) may be made in respect of
different persons, transactions, classes of persons or classes of transactions.

            (3) A power to make a regulation pursuant to this Section includes the power to
make regulations in respect of any interests or notices that are authorized by or pursuant to any
Act, other than this Act, to be registered in the Registry and the registration of such interests or
notices, and this Section shall be given effect, with the necessary modifications, to achieve this
purpose.

            (4) The exercise by the Governor in Council of the authority contained in this
Section is regulations within the meaning of the Regulations Act.


                           PART VII

           TRANSITIONAL, CONSEQUENTIAL AMENDMENTS,
                REPEALS AND COMING INTO FORCE

         73 (1) A reference to the Assignment of Book Debts Act, the Bills of Sale Act, the
Conditional Sales Act or the Corporations Securities Registration Act in any enactment other
than this Act or a regulation made pursuant to this Act or in any agreement or other writing that
relates to a security interest is deemed to be a reference to this Act or to the corresponding
provision of this Act.

            (2) A reference to a bill of sale, chattel mortgage, conditional sales contract, fixed
charge, floating charge, pledge or assignment of book debts or the like, or any derivative of those
terms, or to any other agreement or transaction that creates or provides for a security interest
in any enactment other than this Act or a regulation made pursuant to this Act, or in any
agreement or other writing is deemed to be a reference to the corresponding kind of security
agreement under this Act.


         74 (1) In this Section and Section 75,

                (a) "prior law" means the law in force immediately before the coming into
            force of this Act and includes prior registration law;

                (b) "prior registration law" means the Assignment of Book Debts Act, the
            Bills of Sale Act, the Conditional Sales Act and the Corporations Securities
            Registration Act as they read immediately before the coming into force of this Act.

            (2) Except as otherwise provided, this Act applies to

                (a) every security agreement entered into after the coming into force of this
            Act, including an agreement that renews, extends or consolidates an agreement
            entered into before the coming into force of this Act;

                (b) every security agreement entered into before the coming into force of
            this Act that has not been validly terminated in accordance with prior law before the
            coming into force of this Act;

                (c) every prior security interest that is not enforced or otherwise validly
            terminated in accordance with the prior law before the coming into force of this Act;
            and

                (d) a receiver appointed before or after the coming into force of this Act.

            (3) Sections 11 and 12 do not apply to a security agreement referred to in clause
(2)(b).

            (4) The validity of a prior security interest is governed by the prior law.

            (5) The order of priorities

                (a) between prior security interests is determined by the prior law, if all the
            competing security interests arose under security agreements entered into before
            the coming into force of this Act; and

                (b) between a prior security interest and the interest of a third party is
            determined by the prior law, if the third party interest arose before the coming into
            force of this Act and the security interest arose under a security agreement entered
            into before the coming into force of this Act.

            (6) Subject to subsection (3) and Section 75, the order of priorities

                (a) between a security interest arising after the coming into force of this Act
            and a prior security interest is determined by this Act; and

                (b) between a security interest arising after the coming into force of this Act
            and the interest of a third party arising before the coming into force of this Act is
            determined by this Act.

            (7) Notwithstanding the coming into force of this Act and the repeal of the prior
registration law, the prior law is deemed to continue in force and registrations made pursuant
to the prior registration law remain searchable to the extent necessary to give effect to this
Section and Section 75.


         75 (1) Except as otherwise provided in this Section, a prior security interest that
immediately before the coming into force of this Act was covered by an unexpired registration
pursuant to the prior registration law is deemed to have been registered and perfected pursuant
to this Act as of the time of registration pursuant to the prior registration law.

            (2) Subject to this Act, the registered and perfected status of a prior security
interest referred to in subsection (1) continues until the expiration of its registration pursuant
to the prior registration law or the expiration of three years after the coming into force of this
Act, whichever is earlier, or, where the registration pursuant to the prior registration law does
not expire, until the expiration of three years after the coming into force of this Act, and may be
further continued by registration pursuant to this Act if the prior security interest could have
been perfected by registration pursuant to this Act had the security interest attached after the
coming into force of this Act.

            (3) A prior security interest is covered by an unexpired registration pursuant to
the prior registration law within the meaning of subsections (1) and (2) only if the requirements
of the prior registration law were complied with and regardless of whether or not the
requirements for perfection of the security interest under this Act would have been met had the
registration been made pursuant to this Act.

            (4) A prior security interest that under prior law had the status of a perfected
security interest without registration and without the secured party taking possession of the
collateral is deemed to be perfected pursuant to this Act as of the time the security interest was
created.

            (5) The perfected status of a prior security interest referred to in subsection (4)
continues only for three years after the coming into force of this Act but may be further continued
by perfection pursuant to this Act if the prior security interest could have been perfected pursuant
to this Act had the security interest attached after the coming into force of this Act.

            (6) For the purpose of subsection (4), a prior security interest had the status of
a perfected security interest under the prior law if the secured party complied with the prior law
relating to the creation and continuance of the security interest and the security interest had a
status under prior law similar to that of an equivalent security interest created and perfected
pursuant to this Act in relation to the interest of other secured parties, buyers, creditors of the
debtor or a trustee in bankruptcy of the debtor.

            (7) A prior security interest in the form of an assignment of existing or future
debts to which the Assignment of Book Debts Act did not apply is deemed to be perfected

                (a) for the purpose of subsection 21(1), as of the time the security interest
            was created; and

                (b) for all other purposes under this Act, as of the time notice of the
            assignment is given to the account debtor.

            (8) The perfected status of a prior security interest referred to in subsection (7)
continues only for three years after the coming into force of this Act but may be continued by
perfection pursuant to this Act if the prior security interest could have been perfected pursuant
to this Act had the security interest attached after the coming into force of this Act.

            (9) A prior security interest that, on the coming into force of this Act, could have
been but was not

                (a) registered pursuant to prior registration law; or

                (b) perfected pursuant to prior law through possession of the collateral by
            the secured party,

may be perfected pursuant to this Act if it is a security interest that could have been perfected
pursuant to this Act had the security interest attached after the coming into force of this Act.

            (10)    A prior security interest that under this Act may be perfected by the secured
party taking possession of the collateral is deemed to be perfected for the purpose of this Act
when possession of the collateral is taken in accordance with Section 25 whether or not
possession was taken before or after the coming into force of this Act and notwithstanding that
under prior law the security interest could not have been perfected by taking possession of the
collateral.

            (11)    A prior security interest, that, immediately before the coming into force of this
Act, is covered by an unexpired registration under the prior registration law but that has the
status of a perfected security interest under this Act without registration or the secured party
taking possession of the collateral, remains perfected under this Act.

            (12)    A prior security interest, that, immediately before the coming into force of this
Act, could have been, but was not, covered by a registration under prior registration law but that,
under this Act, may be perfected without registration or the secured party taking possession of
the collateral, is perfected under this Act if all the requirements for perfection of a security
interest under this Act are met.

            (13)    Where the perfection of a prior security interest that is deemed registered or
perfected under this Section is continued by registration pursuant to this Act,

                (a) registration pursuant to this Act continues any registration or perfected
            status under the prior law for the purpose of subsection 74(5); and

                (b) the registration supersedes any registration or perfection under the
            prior law.


         76 Section 13 of Chapter 7 of the Revised Statutes, 1989, the Agriculture and Rural
Credit Act, is amended by adding "(1)" immediately after the Section number and adding the
following subsection:

            (2) Notwithstanding subsection (1), that subsection does not apply with respect
         to property where an interest in that property may be perfected or registered pursuant to
         the Personal Property Security Act.


         77 Sections 13 and 14 of Chapter 25 of the Revised Statutes, 1989, the Assignments and
Preferences Act, are repealed and the following Section substituted:

            13  A notice of claim in relation to an assignment for the general benefit of
         creditors shall be registered in the Personal Property Registry pursuant to Section 2A of
         the Creditors' Relief Act.


         78 (1) Section 2 of Chapter 112 of the Revised Statutes, 1989, the Creditors' Relief
Act, is amended by

                (a) re-lettering clause (a) as (aa) and adding immediately before that
            clause the following clause:

                    (a)  "attachable debt" means a debt that can be made the subject of
                an execution order issued pursuant to the Civil Procedure Rules or an
                attaching order pursuant to this Act or the Civil Procedure Rules;

                (b) adding immediately after clause (aa) the following clauses:

                    (ab) "enforcement proceeding" means any proceeding authorized by
                this Act, the Assignments and Preferences Act, the Collection Act, Judicature
                Act or the Civil Procedure Rules to be taken for the purpose of enforcing a
                money judgment or for the purpose of enforcing the claims of creditors
                against the personal property of a debtor;

                    (ac) "exigible personal property" means any personal property of a
                judgment debtor that can be made the subject of an enforcement proceeding
                except a debt that can be made the subject of an enforcement proceeding only
                by way of an attaching order pursuant to this Act;

                (c) striking out the period immediately after clause (b) and substituting a
            semicolon; and

                (d) adding immediately after clause (b) the following clauses:

                    (c)  "judgment creditor" means a person in whose favour there is a
                subsisting money judgment;

                    (d)  "judgment debtor" means a person against whom there is a
                subsisting money judgment;

                    (e)  "money judgment" means a judgment or order for the recovery
                or payment of money or that part of a judgment or order that requires a
                person to pay money and includes a certificate pursuant to this Act;

                    (f)  "notice of judgment" and "notice of claim" mean the data
                authorized by the regulations made pursuant to the Personal Property
                Security Act to be registered in the Registry to effect a registration pursuant
                to this Act and, where the context permits, includes the data authorized to be
                registered to effect an amendment, renewal or discharge of a registration;

                    (g)  "personal property" means personal property as defined in the
                Personal Property Security Act;

                    (h)  "Registry" means the Personal Property Registry established by
                subsection 43(1) of the Personal Property Security Act;

                    (i)  "Supreme Court" means the Supreme Court of Nova Scotia.

            (2) Chapter 112 is further amended by adding immediately after Section 2 the
following heading and Sections:

         PERSONAL PROPERTY SECURITY ACT
             REGISTRATION

                    2A   (1)  A judgment creditor who has obtained a money judgment may
                register a notice of the judgment in the Registry in accordance with the
                regulations made pursuant to the Personal Property Security Act.

                         (2)  Registration of a notice of judgment is effective for the period
                of years specified in the registration to a maximum of twenty years after the
                date of the judgment to which the registration relates.

                         (3)  A registration may be amended or renewed by registering an
                amendment or renewal of the notice of judgment at any time before the
                registration expires but the registration shall not have an aggregate
                registration life of more than twenty years after the date of the judgment to
                which the registration relates.

                         (4)  A judgment creditor shall discharge the registration of a
                notice of judgment within thirty days after the judgment is satisfied or within
                thirty days after the occurrence of any other event as a result of which there
                is no longer a subsisting judgment.

                         (5)  Where a judgment creditor fails or refuses to comply with
                subsection (4), the judgment debtor or any other person with an interest in the
                exigible personal property of the debtor or the attachable debts of the debtor
                may make a written demand to the judgment creditor to discharge the
                registration within fifteen days after the demand is made.

                         (6)  Where a judgment creditor fails to comply with a demand
                made pursuant to subsection (5) within fifteen days after it is made or fails to
                give to the person making the demand an order of the Supreme Court
                confirming that the registration need not be discharged, the person making
                the demand may register the discharge.

                         (7)  On application by the judgment creditor or judgment debtor
                or any other person with an interest in the exigible personal property or
                attachable debts of the debtor, the Supreme Court may order that a
                registration of a notice of judgment be maintained on any condition and for
                any period of time or may order that the registration be discharged.

                         (8)  No fee or expense shall be charged by a judgment creditor for
                compliance with a demand made pursuant to this Section.

                    2B  (1) Personal property of a judgment debtor shall not be bound
                except by registration of a notice of judgment pursuant to subsection (1) of
                Section 2A.

                        (2) Registration of a notice of judgment binds all of the
                judgment debtor's non-exempt exigible personal property on registration and
                all non-exempt exigible personal property acquired by the judgment debtor
                after registration from the time of its acquisition.

                        (3) Registration of a notice of judgment binds all non-exempt
                attachable debts owing to the judgment debtor on or after registration from
                the time the debt becomes an attachable debt except as against the person
                who owes the debt to the judgment debtor.

                        (4) Registration of a notice of judgment binds the personal
                property of the judgment debtor only while the judgment is a subsisting
                judgment.

                        (5) Subject to this Section, an interest acquired in personal
                property that is bound by a registration of a notice of judgment is subordinate
                to the interest of

                            (a)  the judgment creditor;

                            (b)  all persons entitled by this Act or otherwise to
                        participate in a distribution of personal property subject to the
                        interest of a creditor referred to in clause (a); and

                            (c)  a sheriff and a representative of creditors for the
                        purpose of enforcing the rights of a creditor referred to in clause
                        (a).

                        (6) A person to whom personal property bound by a notice of
                judgment is transferred has priority as against the persons referred to in
                subsection (5) in the same circumstances that a transferee of personal
                property subject to a security interest perfected by registration has priority
                as against the secured party under subsections (1) to (4), (6) and (8) of
                Section 31 and Section 32 of the Personal Property Security Act, and those
                provisions apply mutatis mutandis.

                        (7) For the purpose of subsection (1) of Section 21 of the
                Personal Property Security Act and subject to Section 23 of that Act, the non-exempt
exigible personal property of a judgment debtor and the non-exempt
                attachable debts of a judgment debtor are bound by registration of a notice
                of judgment notwithstanding that the security interest referred to in subsection
                (1) of Section 21 of the Personal Property Security Act attached before the
                notice of judgment was registered.

                        (8) A lien on goods bound by registration of a notice of
                judgment that arises as a result of the provision in the ordinary course of
                business of materials or services in respect of the goods has priority over the
                interest of the judgment creditor in the goods.

                        (9) An enforcement proceeding for the purpose of enforcing
                a money judgment shall not be commenced until a notice of judgment relating
                to the judgment has been registered pursuant to subsection (1) of Section 2A.

                        (10)     Where an interest acquired in personal property that is
                bound by registration of a notice of judgment is subordinate to the interest of
                a judgment creditor,

                            (a)  the property is subject to enforcement proceedings
                        to the same extent as if the subordinate interest did not exist; and

                            (b)  a person who acquires the property as a result of
                        enforcement proceedings obtains title free of the subordinate
                        interest.

                        (11)     Personal property of a judgment debtor that is bound by
                the registration of a notice of judgment is bound for the amount of the
                judgment, costs and accrued interest less any amounts received by the
                judgment creditor.

                        (12)     An interest in personal property is not subordinate to the
                interest of a judgment creditor who has registered a notice of judgment by
                reason only that the interest is subordinate to the interest of another judgment
                creditor who has registered a notice of judgment but nothing in this Section
                creates any priority as between judgment creditors who have registered
                notices of judgment.

                        (13)     A judgment creditor is not entitled to share in the proceeds
                of a levy by the sheriff against the personal property of the judgment debtor
                pursuant to this Act unless the creditor has registered a notice of judgment
                pursuant to subsection (1) of Section 2A.

                        (14)     In applying the provisions of this Act for the purpose of
                determining the entitlement of creditors to share in the proceeds of a levy by
                the sheriff, a reference to an execution or certificate or the delivery of an
                execution or certificate to the sheriff shall be construed as a reference to a
                registered notice of judgment or the registration of a notice of judgment,
                unless the context otherwise requires.

                        (15)     Where a notice of judgment has been registered, the
                judgment creditor, the judgment debtor or any other person with an interest
                in personal property of the judgment debtor may apply to the Supreme Court
                for an order determining whether or not any item or kind of personal
                property is exempt, exigible or an attachable debt.

                        (16)     A person referred to in subsection (15) may amend the
                registration of the notice of judgment to disclose the particulars of the order
                made pursuant to that subsection.

                    2C  (1) A notice of claim may be registered in the Registry in
                accordance with the regulations made pursuant to the Personal Property
                Security Act by

                            (a)  a creditor who has applied for a warrant pursuant
                        to the Collection Act at any time after the warrant is issued;

                            (b)  an assignee for the general benefit of creditors
                        under the Assignments and Preferences Act at any time after the
                        assignment is made.

                        (2) The commencement of any enforcement proceeding
                pursuant to any of the enactments referred to in subsection (1) does not
                prejudice the interest of a person to whom personal property that is the
                subject of the enforcement proceeding is transferred without knowledge until
                a notice of claim relating to the enforcement proceeding is registered
                pursuant to subsection (1).

                    2D  (1) Property that is exempt from an enforcement proceeding
                is not bound by the registration of a notice of judgment under subsection
                2A(1).

                        (2) For the purpose of subsection (1), property that is exempt
                from seizure under Section 59 of the Personal Property Security Act is
                property exempt from an enforcement proceeding.

                    2E  Where there is a conflict between Sections 2A to 2D and any
                other provision of this Act or of the Assignments and Preferences Act, the
                Judicature Act or the Civil Procedure Rules, Sections 2A to 2D prevail.


         79 Section 32 of Chapter 154 of the Revised Statutes, 1989, the Evidence Act, is
repealed and the following Section substituted:

            32  A copy of any writing filed or registered pursuant to the Assignment of Books
         Debts Act, the Bills of Sale Act, the Conditional Sales Act or the Corporations Securities
         Registration Act may be proved in any court by the production of a copy thereof, certified
         under the hand of the person in whose office the writing is filed.


         80 Chapter 157 of the Revised Statutes, 1989, the Factors Act, is amended by adding
immediately after Section 3 the following Section:

            3A  Section 3 does not apply to a consignment to which the Personal Property
         Security Act applies.


         81 (1) Subsection 7(1) of Chapter 235 of the Revised Statutes, 1989, the
Interpretation Act, as amended by Chapter 31 of the Acts of 1990, is further amended by adding
immediately after clause (s) the following clause:

                (sa)     "Personal Property Registry" means the Personal Property Registry
            established by the Personal Property Security Act;

            (2) Section 7 is further amended by adding immediately after subsection (3) the
following subsection:

                (4) Where, in this Act and every enactment made at the time, before or
            after the coming into force of this subsection, there is a reference to any interest in
            personal property to secure the payment or performance of an obligation, including
            a charge, lien, mortgage or pledge, that reference, unless the context otherwise
            requires, includes a security interest as defined in the Personal Property Security
            Act.


         82 Chapter 258 of the Revised Statutes, 1989, the Limitation of Actions Act, is amended
by adding immediately after Section 24 the following heading and Section:

         ENFORCEMENT PROCEEDINGS PURSUANT TO
         THE PERSONAL PROPERTY SECURITY ACT

            24A No proceedings to enforce security pursuant to Part V of the Personal
         Property Security Act shall be taken by a secured party within the meaning of Part V of the
         Personal Property Security Act or a person claiming through the secured party but within
         twenty years next after the right to take the proceedings first accrued to the secured party,
         or if the right did not accrue to the secured party, then within twenty years next after the
         right first accrued to the person claiming through the secured party.


         83 Subsections 20(2) and (3) of Chapter 275 of the Revised Statutes, 1989, the
Matrimonial Property Act, are repealed and the following subsections substituted:

            (2) A notice of an order made under this Act respecting personal property in the
         form prescribed by regulations made pursuant to the Personal Property Security Act may
         be filed in the Personal Property Registry and, where it is not so filed, the order does not
         affect the acquisition of an interest in that personal property by a person in good faith
         without notice of the order.

            (3) Where an order relates to goods that are designated by regulations made
         pursuant to the Personal Property Security Act as serial numbered goods and a notice
         does not describe those goods by serial number, the notice is deemed not to be filed
         pursuant to subsection (2) with respect to those goods.


         84 (1) Chapter 392 of the Revised Statutes, 1989, the Registry Act, is amended by
adding immediately after Section 1 the following heading and Section:

            APPLICATION

                1A  (1)  In this Section, "security" and "instrument" have the same
            meaning as in clause 5(f) of the Personal Property Security Act.

                    (2)  This Act applies to

                         (a)  the creation or transfer of an interest in land, including a
                    lease; and

                         (b)  the creation or transfer of a right to payment that arises in
                    connection with an interest in or a lease of land other than a right to
                    payment evidenced by a security or instrument.

            (2) Chapter 392 is further amended by adding immediately after Section 18 the
following Section:

                18A For greater certainty and subject to Section 50 of the Personal Property
            Security Act, no person contracting or dealing with or taking or proposing to take
            a transfer of or an interest in land is affected by a registration in the Personal
            Property Registry, whether or not that person has notice or knowledge of the
            registration, and such notice or knowledge is not notice within the meaning of
            Section 18.


         85 Subsections 60(2) and (3) of Chapter 408 of the Revised Statutes, 1989, the Sale of
Goods Act, are repealed and the following subsections substituted:

            (2) Nothing in this Act affects any enactment relating to personal property
         security or any enactment relating to the sale of goods.

            (3) The provisions of this Act relating to contracts of sale do not apply to any
         transaction in the form of a contract of sale to the extent that the transaction is intended
         to operate as an agreement that creates or provides for an interest in goods to secure
         payment or performance of an obligation.


         86 Chapter 464 of the Revised Statutes, 1989, the Tenancies and Distress for Rent Act,
is amended by adding immediately after Section 8 the following heading and Section:

              PRIORITIES

            8A  (1) In this Section,

                    (a)  "collateral" means personal property in which a security interest
                is taken;

                    (b)  "perfected" has the same meaning as in the Personal Property
                Security Act;

                    (c)  "proceeds" means proceeds as defined in the Personal Property
                Security Act;

                    (d)  "purchase money security interest" means

                        (i) a security interest taken in collateral to the extent that it
                    secures payment of all or part of its purchase price and the credit
                    charges for the purchase, and

                        (ii)    a security interest taken in collateral by a person who
                    gives value for the purpose of enabling the tenant to acquire rights in
                    the collateral, to the extent that the value is applied to acquire the
                    rights, and value includes interest, credit costs and other charges
                    payable,

                but does not include an interest of a lessor under a transaction of sale by and
                lease back to the seller;

                    (e) "security interest" means an interest in personal property that
                secures payment or performance of an obligation.

                (2) A distress for rent has priority over

                    (a) a security interest in the goods of the tenant other than a
                purchase money security interest in goods or proceeds of those goods that is
                perfected at the date of the distress;

                    (b) the interest of a judgment creditor of the tenant under Section 2B
                of the Creditors' Relief Act.

                (3) Nothing in subsection (2) shall be construed as affecting or limiting the
         priorities that a distress for rent had immediately prior to the coming into force of this
         Section.


         87 Section 10 of Chapter 9 of the Acts of 1994-95, the Tourist Accommodations Act,
is amended by adding immediately after subsection (1) the following subsection:

            (1A)    A lien on baggage and property arising under subsection (1) as a result of the
         furnishing of food or accommodation is subordinate to the interest in that baggage and
         property of any person who has registered before the food or accommodation was
         furnished, pursuant to the Personal Property Security Act, a financing statement or other
         notice in relation to that interest.


         88 (1) Subsection 4(1) of Chapter 499 of the Revised Statutes, 1989, the
Warehousemen's Lien Act, is amended by

                (a) striking out all that portion of clause (a) immediately after "goods" in
            the first line to the end of that clause and substituting a semicolon;

                (b) striking out clause (b) and substituting the following clause:

                    (b)  any person who has an interest in the goods that secures
                payment or performance of an obligation and who has registered, before the
                date of the deposit, a financing statement relating to that interest in the
                Personal Property Registry pursuant to the Personal Property Security Act.

            (2) Subsection 5(2) of Chapter 499 is amended by

                (a) striking out all that portion of clause (b) immediately after "goods" in
            the first line to the end of that clause and substituting "and to any person who has
            an interest in the goods that secures payment or performance of an obligation and
            who has, before the date of the deposit, registered a financing statement relating to
            that interest pursuant to the Personal Property Security Act"; and

                (b) striking out clause (c).


         89 (1) Chapter 24 of the Revised Statutes, 1989, the Assignment of Book Debts Act,
is repealed.

            (2) Chapter 39 of the Revised Statutes, 1989, the Bills of Sale Act, is repealed.

            (3) Chapter 48 of the Revised Statutes, 1989, the Bulk Sales Act, is repealed.

            (4) Chapter 84 of the Revised Statutes, 1989, the Conditional Sales Act, is
repealed.

            (5) Chapter 102 of the Revised Statutes, 1989, the Corporations Securities
Registration Act, is repealed.

            (6) Chapter 230 of the Revised Statutes, 1989, the Instalment Payment Contracts
Act, is repealed.

            (7) Chapter 15 of the Acts of 1986, the Personal Property Lien Registry Act, is
repealed.


         90 This Act comes into force on such day as the Governor in Council orders and
declares by proclamation.