In the matter of OneSteel Manufacturing Pty Limited (administrators appointed) [2017] NSWSC 21

In the matter of OneSteel Manufacturing Pty Limited (administrators appointed) [2017] NSWSC 21

The omission of OneSteel's ACN from the original financing statements rendered the registrations defective and ineffective, because a search using only the ACN as required would not reveal the registrations. The defect was also seriously misleading, as authorised searchers would not discover the registration. The security interests were thus unperfected at the critical time and vested in OneSteel under s 267 of the PPSA. This vesting was not an unconstitutional acquisition of property within the meaning of s 51(xxxi) of the Constitution, as it either involved no acquisition or was not for a relevant Commonwealth purpose. Relief under Corporations Act s 588FM is not available for...

Jurisdiction
Australia
Judgment Date
31 January 2017
Procedural Posture
Principal Judgment / Final Judgment After Hearing of Originating Process and Cross Claim
Outcome
Plaintiff's originating process dismissed; declaration in favour of first defendant on cross-claim; plaintiff to pay costs of proceedings (including cross-claim) to first and second defendants.
Legal Topics
['personal Property Securities Registration Effectiveness' 'corporations—vesting of Unperfected Security Interests' 'constitution S 51(xxxi)—acquisition of Property' 'security Interests—seriously Misleading Defects' 'extension of Time for Registration (s 588 Fm)']
['corporations Law' 'personal Property Securities' 'constitutional Law'] ['personal Property Securities Registration Effectiveness' 'corporations—vesting of Unperfected Security Interests' 'constitution S 51(xxxi)—acquisition of Property' 'security Interests—seriously Misleading Defects' 'extension of Time for Registration (s 588 Fm)']

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Procedural Posture

Principal Judgment / Final Judgment After Hearing of Originating Process and Cross Claim

Legal Issues

  1. 1 ["Whether omission of grantor's ACN from financing statement renders registration defective and ineffective" 'Whether defect is seriously misleading or falls within s 165(b) of PPSA' 'Whether s 267 PPSA validly vests unperfected security interests in grantor and is constitutionally valid' 'Whether relief under Corporations Act s 588FM or PPSA s 293(1)(a) is available to cure or prevent vesting']

Ratio Decidendi

The omission of OneSteel's ACN from the original financing statements rendered the registrations defective and ineffective, because a search using only the ACN as required would not reveal the registrations. The defect was also seriously misleading, as authorised searchers would not discover the registration. The security interests were thus unperfected at the critical time and vested in OneSteel under s 267 of the PPSA. This vesting was not an unconstitutional acquisition of property within the meaning of s 51(xxxi) of the Constitution, as it either involved no acquisition or was not for a relevant Commonwealth purpose. Relief under Corporations Act s 588FM is not available for...

Court Disposition

Plaintiff's originating process dismissed; declaration in favour of first defendant on cross-claim; plaintiff to pay costs of proceedings (including cross-claim) to first and second defendants.

Orders

  • ['The originating process be dismissed.' 'Declare that the interest of the plaintiff as lessor of the Striker crushing and screening plant referred to in Rental Schedule E2N0157602 and in the spare parts referred to in Rental Schedule E2N0158455 under the rental agreement dated 16 October 2014 between the plaintiff...