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Difference between revisions of "Creditors' Remedies against Debtors (10:III)"
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Creditors' Remedies against Debtors (10:III) (view source)
Revision as of 23:11, 17 August 2019
, 23:11, 17 August 2019→5. Remedies
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=== 5. Remedies === | === 5. Remedies === | ||
Where a debtor defaults on a security agreement, s 56 provides that the only rights and remedies the secured party has against the debtor are those provided in the security agreement (as long as they do not derogate those rights given to the debtor by the ''PPSA''), | Where a debtor defaults on a security agreement, s 56 provides that the only rights and remedies the secured party has against the debtor are those provided in the security agreement (as long as they do not derogate those rights given to the debtor by the ''PPSA''), and those specifically provided by the ''PPSA'' (s 17 and ss 36 – 38). | ||
Important sections of the ''PPSA'' for the creditor are ss 58 and 59, which contain rules for seizing and disposing of collateral. These sections provide that, unless the security agreement states otherwise, where the debtor defaults on their payment, the creditor may elect to take possession of the collateral pursuant to the contract, dispose of the collateral and then sue for any amount still owing. Section 67, provides for a more limited set of remedies where the collateral takes the form of consumer goods – known as the “seize or sue” rule. Formerly, under legislation repealed by the ''PPSA'', all creditors could only seize or sue but not both. '''The principle of “seize or sue” still applies to “consumer goods” (see [[{{PAGENAME}}#6. Seizure | Section II.A.6: Seizure]], below); it no longer applies to commercial goods'''. | Important sections of the ''PPSA'' for the creditor are ss 58 and 59, which contain rules for seizing and disposing of collateral. These sections provide that, unless the security agreement states otherwise, where the debtor defaults on their payment, the creditor may elect to take possession of the collateral pursuant to the contract, dispose of the collateral and then sue for any amount still owing. Section 67, provides for a more limited set of remedies where the collateral takes the form of consumer goods – known as the “seize or sue” rule. Formerly, under legislation repealed by the ''PPSA'', all creditors could only seize or sue but not both. '''The principle of “seize or sue” still applies to “consumer goods” (see [[{{PAGENAME}}#6. Seizure | Section II.A.6: Seizure]], below); it no longer applies to commercial goods'''. | ||