However, the fact that s 51C contains a variable levy within the meaning of the definition of the outstanding security interest does not mean that parties to a security agreement on a circulating asset may disconnect from PPSA`s priority rules in favour of variable levy. Nor does it mean that the variable fee remains for personal property subject to the PPSA. The floating lot is included in the definition, as part of the personal property is removed from the scope of the PPSA, in which case the PPSA priority rules do not apply and a floating fee for this personal property remains possible. Payments, which the Court refers to as “forge claims,” are clearly subject to the SPA and are therefore not in a position to be subject to a variable levy. However, the Court found that the ANZ security agreement “has the effect of ensuring the application of the common law … The charge acts as a floating charge over Forge`s claims.  As explained above, anZ`s security agreement does not allow for the floating charge to be invoked with respect to Forge`s claims. The PPSA`s fabric-on-form approach means that a floating load is treated like any other safety interest. Parties to a security agreement can no longer agree on a variable fee, so all legal incidents of the variable fee apply to their transaction. They may agree that a title surcharge will be linked to security at a later date, but not that it will be subject to a variable fee in the pre-PPSA act.
Problems arose with these agreements when other parties participated in the secure terrain. For example, a borrower sometimes sold the secured goods to another person without saying anything about the security agreement. In the early 20th century, many Canadian provinces, including BC, passed legislation to address the injustice that has often arisen as a result of this legal principle. The basic idea of the laws was to ensure that sellers, lenders and all borrowers knew when the goods were subject to a security agreement. Legislators have done this by creating government records to record security agreements, such as cat mortgages and conditional sales contracts. In C.C.A., registration was once called the central register. It is now called the Personal Property Registry (see below). Attachment (see Section 12) is a technical concept under the Personnel Property Safety Act. In the simplest case, this means that the guaranteed party and the debtor enter into a written agreement. For most consumer transactions with security removed, seizure requirements are met by a written agreement with legal consideration (section 10).
The specific term used in the law is “value.” Security agreements allow the creditor to take over the borrower`s property immediately after default. The secured creditor is not obliged to sue the borrower first and wait for a judgment before exercising his right to take possession of the borrower`s property. In practice, security agreements are often important because they allow a creditor to have the first right to ownership of the borrower in front of creditors who do not have a guarantee.