Chapter 19.1Chapter 19.1

The Law of Real and The Law of Real and Personal PropertyPersonal Property

Real and personal propertyReal and personal property

Real property

Land and interests in land

Personal property

Property other than land - chattels

Tangible property

Transferable by delivery (Choses in possession)

Motor vehicles, furniture textbooks, etc.

Intangible property

Transferable by assignment (Choses in action)

Accounts receivable. insurance policies, copyright, patents, etc.

The ownership of propertyThe ownership of property

If we say person “owns” a piece of property we mean that they have the right to:

use and enjoy it;

sell it;

dispose of it by will or gift;

retain possession of it for any period;

mortgage it and let it;

destroy it.

The transfer of ownership or titleThe transfer of ownership or title

Transfer of title in property may beTransfer of title in property may be by: by:

sale, sale,

gift, gift,

will, or will, or

operation of law. operation of law.

Nemo dat quod non habet No one can give what they do not have. You cannot transfer a better title than you have yourself.

There are number of exceptions under the Land Transfer Act 1952:

sale by a mercantile agent

sale of a vehicle by a motor vehicle dealer

sale by a seller in possession under s27(1) Sale of Goods Act 1908.

Personal Property:Personal Property: the the protection of protection of

property and possessory property and possessory rightsrights

The Personal Property Securities Act 1999The Personal Property Securities Act 1999

The scope of the Act:The scope of the Act:

The enforceability of an interest in personal property created or The enforceability of an interest in personal property created or provided for by a transaction that secures payment for money or provided for by a transaction that secures payment for money or performance of an obligation. This interest is called a "security performance of an obligation. This interest is called a "security interest".interest".

The determination of priorities between security interests in the same The determination of priorities between security interests in the same personal property.personal property.

The determination of priorities between a security interest and another The determination of priorities between a security interest and another type of interest type of interest ( for example, the interest of a buyer) in the same personal property.

A system for regulating securities over personal A system for regulating securities over personal property must provideproperty must provide::

• for an effective security agreement between the parties to the for an effective security agreement between the parties to the agreement,agreement,

• and ensure that the security agreement is enforceable against the parties and ensure that the security agreement is enforceable against the parties to it and third parties (i.e.,persons who are not parties to the security to it and third parties (i.e.,persons who are not parties to the security agreement).agreement).

The Act creates two important concepts: The Act creates two important concepts: attachmentattachment and and perfectionperfection

Attachment of a security interestAttachment of a security interest (when a security interest comes into existence) (when a security interest comes into existence) occurs when: occurs when:

•the secured party gives value for the loan,the secured party gives value for the loan,

• the debtor has rights in the personal property that is used as security for the loan, the debtor has rights in the personal property that is used as security for the loan,

•the security agreement is enforceable against third parties other than purchasers. the security agreement is enforceable against third parties other than purchasers.

The perfection of security interestsThe perfection of security interests requires attachment together with one of the requires attachment together with one of the methods of achieving perfection, such as methods of achieving perfection, such as

•registration of a financing statement; or registration of a financing statement; or

•the secured party taking possession of the personal property that is subject to a the secured party taking possession of the personal property that is subject to a security interest. security interest.

Perfection is relevant to giving a secured party priority over third parties who Perfection is relevant to giving a secured party priority over third parties who have purchased the property. have purchased the property.