Suppliers need to get their act together
The Personal Property Securities Act came into force in 2002 and yet we are still finding suppliers who have failed to protect themselves.
In many cases, they are relying on the old “Romalpa” or “retention of title” clauses in the terms and conditions or, in many cases, just have the line printed on their invoices.
To rely on such old fashioned terms is unwise. If a bank or finance house has registered a General Security Agreement over the debtor’s assets, then all retention of title clauses will have no effect.
Education is still the key. For all those who provide advice to companies that supply goods on credit, they need to be aware of the need to;
a) have appropriately drafted (and signed) terms and conditions that allow the creditor to register a financing statement on the Personal Property Securities Register
b) have made that registration on the Personal Property Securities Register
Its simple, quick, easy and cheap to do and is the only thing that will provide some level of protection should your customer become insolvent.