Changes to Personal Property Security Act - Report 2007


[8] In 2002 Professor Walsh and the author of this report prepared and presented to the ULC a Discussion Paper on Potential Changes to the Model Personal Property Security Act of the Canadian Conference on Personal Property Security Law. This involved an extensive report and drafted provisions dealing with changes to the CCPPSL Model that, at the time, were thought to be warranted. This did not induce legislative changes (or, for that matter, much interest) in any province or territory.

[9] In 2002 the ULC, as part of the Commercial Law Strategy, created the Study Committee on the Reform of Personal Property Security Law and Hypothecs on Movable Property. The Study Committee held meetings over the following two years. Its work focused on amendments to the PPSA required to accommodate changes in the law resulting from the enactment of the Uniform Securities Transfer Act. This aspect of its activities can be treated as a success since its recommendations, for the most part, have been or will soon be enacted in all provinces and territories.

[10] A second aspect of its work focussed on a few areas of PPSA law in which there are substantial differences among the various Acts, particularly between the OPPSA and the Acts based on the CCPPSL Model. In a series of meetings, the Study Committee examined the issues involved and reached tentative consensus as to what approaches should be recommended. It prepared a set of questionnaires that were widely circulated among practitioners throughout the country seeking their reaction to the tentative conclusions of the Study Committee. Very little response was received. In a final report presented to the ULC in 2004, the Study Committee recommended changes in the PPSAs based on its conclusions. To date, only those changes associated with the Uniform Securities Transfer Act have received attention of legislative drafters. (Changes in the conflict of laws rules proposed by the Study Committee were picked up but subsequently re-considered in the light of the developments described later in this report).

[11] It would be fair to conclude that, on the whole, and apart from changes designed to accommodate the Securities Transfer Act, recent ULC efforts to secure uniform, modernized secured transactions law have been unsuccessful. There may be several explanations for this including: (i) the low quality of the proposals; (ii) the lack of any appetite for legislative change; (iii) the inadequacy of the approach; or (iv) the lack of a mechanism to ensure that changes would not result in destroying the high level of uniformity that now exists.

[12] Since the author was personally involved in these undertakings, he is not in a position to pass judgment on (i). As to (ii), the author is aware that at least two provinces are interested in “modernizing” their Acts. The author’s constant exposure to this area of the law as a teacher and researcher (supplemented by the experience of co-authoring a book on Canadian PPSA law) has convinced him that, while change is not urgent, there is scope for improvement of the CCPPSL Model. Some jurisdictions may not be particularly interested in significant changes at this time since they have recently enacted their PPSAs. However, this may change if other jurisdictions are implementing amendments to their Acts. Recent amendments to the Ontario Act indicate a renewed interest in that province in updating the OPPSA in order to incorporate a few features of the CCPPSL Model Act.

[13] As to (iii), experience demonstrates that, in this context, the usual ULC structure of a representative working group of named persons who meet occasionally and prepare a report is not an appropriate way to proceed.

[14] As to (iv), it is the author’s strongly-held view that reform measures undertaken in the future must not threaten the very substantial uniformity that now exists. Clearly, any proposals for change must be approached in a manner through which implementation will be substantially contemporaneous in all common law jurisdictions.

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