Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) If collateral would be able to be transferred (including by sale, by creating a security interest or under proceedings to enforce a judgment) but for a provision in a security agreement prohibiting the transfer or declaring the transfer to be a default, the collateral may be transferred, despite the provision:
(a) by consent between the grantor and the transferee; or
(b) by operation of law.
Note: See section 32 in relation to security interests in proceeds that arise as a result of a transfer.
(2) A transfer mentioned in subsection (1) does not prejudice the rights of the secured party under the security agreement or otherwise, including the right to treat a prohibited transfer as an act of default.