This case study does not cover every step of the registration process, but instead highlights some of the key questions you may have.
Printernational Pty Ltd supplies heavy-duty photocopying and printing equipment to the printing sector. Page and Co is a partnership offering commercial office copying and printing services. It leases a multifunction industrial printer from Printernational for a period of 3 years.
Printernational emails Page and Co asking them to agree to the standard terms and conditions for the lease. The email also describes the model and number of the printer. Page and Co sends an email response with an electronic signature of the Chief Executive, agreeing to the terms. Before the printer is delivered to Page and Co’s premises, Printernational registers a financing statement on the PPSR.
Printernational is able to register a purchase money security interest - PMSI - as the lease is for more than 2 years. This is their first dealing with Page and Co. Two weeks after delivery of the printer, Printernational leases an industrial laminator to Page and Co for 3 years on the same terms and conditions.
One year later Dombank, which has a previously registered security interest over all the assets of Page and Co, appoints receivers to Page and Co to enforce its security interest. Despite this, Printernational is able to repossess both the printer and the laminator because they are the same type of collateral and their one registration was broad enough to describe both items and so protects their interests under both leases. As they have registered their PMSI, they have priority over Dombank in relation to the equipment.
Tip: The registration covers the laminator supplied two weeks later to the same customer as it is within the collateral class 'commercial property: other goods'. Printernational does not need to register again.
Create Secured Party Group:
a) A secured party group is needed to complete a registration.
Secured party details - for this case study you will need to use Printernational Pty Ltd’s ACN number.
Secured party details - for this case study you will need to use Printernational Pty Ltd’s ACN number.
The secured party identifier is the ACN as it is an incorporated company. For more information see How to create a secured party group.
b) Address for service
The email given for the address for service is where documents may be served and enquiries made. For more information see Address for service.
Create a registration
c) Collateral type - select commercial
As the equipment is used to further a business it is commercial property.
d1) Collateral class - select other goods and use the free text field to describe the goods
The printer, for business use, is commercial property. It is other goods because it does not come under the other specified collateral classes in the regulations.
d2) Collateral step 2 - use the free text field to describe the goods
Using the free-text box on the financing statement (commonly known as a PPSR registration) to add more detail about the registered goods is optional. Printernational could state that the collateral is office equipment leased from Printernational, because without clarification it could suggest they are claiming security over all Page and Co’s other goods, which either Page and Co or other lenders may challenge. However, by using the general description office equipment in the free‑text box, the registration can also cover future leases of other types of office equipment from Printernational to Page and Co (for example, scanners, shredders, and binding machines).
e) Registration period - 7 years
As the printer is commercial property, the registration period can be a fixed period of up to 25 years or indefinite. In this case, Printernational would have chosen to pay for a longer registration than the 3-year lease period, in this case 7 years, because it wants to use this registration to also cover future supplies of goods to Page and Co.
f) Purchase money security interest (PMSI)? - Tick the box
The lease is for more than 2 years and is a personal property securities (PPS) lease, which is a super-priority PMSI. A lease for more than 2 years is within the definition of a PMSI. Find out more about priorities and purchase money security interests.
g) Inventory? - Leave box blank
To help ensure a valid registration, you must state, in the case of commercial property, whether or not it may form part of the inventory of the grantor (i.e. raw materials, or products or stock which are on-sold, used up or processed in the course of the business; not equipment the grantor uses to carry out its business).
h) Proceeds? For this case study, the proceeds to be claimed box is ticked and the text all present and after acquired property then displays in the text box
If Page and Co dispose of the printer—which they would not be entitled to do without Printernational's permission—checking this box enables Printernational to claim the proceeds, whatever their form.
i) Grantor details — because Page and Co is a partnership, Printernational will use Page and Co’s ABN when it fills in details about the grantor
As Page and Co is a partnership, the ABN must be used.
