The decision of the Supreme Court of NSW in OneSteel Manufacturing Pty Ltd (Administrators Appointed)  NSWSC 21, demonstrates how costly a simple mistake can be.
The facts were that Alleasing Pty Ltd (“Alleasing”) leased valuable mining equipment to OneSteel Manufacturing Pty Ltd. Alleasing registered its security interest on the Personal Properties Security Register, but mistakenly entered OneSteel’s ABN rather than its ACN in the financing statement. The staff member who registered the security interest was not aware of the difference between the treatment of an ABN and an ACN nor of the legal requirement to use an ACN during the Personal Property Securities Act 2009 (Cth) (‘PPSA’) registration process.
When OneSteel’s Administrators were appointed, it was argued that the failure to use the ACN was a defect in registration and that Alleasing’s interest in the goods would pass to OneSteel’s Administrators.
In his judgment, his Honour found that under the PPSA, there was a distinction between the use of an ABN and an ACN identifier. His Honour found that the defect would be seriously misleading, because the omission of the ACN meant that searches using the ACN could not discover the registration.
The decision in this case demonstrates that strict compliance with the requirements of the PPSA is critical when registering security interests and, to ensure that the appropriate system is in place to ensure that security interests over property are registered properly and on time.
For more information about the Personal Property and Securities Register or security interests, please contact Rockliffs Lawyers on (02) 9299 4912.