The NZ Experience

The New Zealand experience

There are some differences between the PPSR in New Zealand and the PPSR in Australia. Veda has learnt from our experience in New Zealand and is leveraging this to improve our offering and include additional services.

What happens if I don't load security interests?

Here is an example of what could happen to your business if you choose to do nothing. Legislation in New Zealand is slightly different to Australia but the fundamental principles of PPSR are the same.

Graham v Portacom New Zealand Limited [2004]

Portacom leased portable buildings to NDG. The leases were for a term of more than 1 year and therefore gave rise to a security interest in favour of Portacom. This security interest was never registered on the PPSR - unperfected security interest. HSBC had a debenture over NDG's assets, which was registered on the PPSR - perfected security interest. HSBC appointed Ferriers as receivers over NDG's assets.

Issue: Does HSBC's registered security interest take priority over Portacom's interest as legal owner of the assets?

• Finding 1: The Court held that the priority between conflicting security interests was to be determined in accordance with the PPSA
• Finding 2: A perfected security interest takes priority over an unperfected security interest
• Result: HSBC's security interest had priority over Portacom's security interest even though Portacom was the legal owner of the assets in question
• The economic interest in Portacom's asset goes to benefits