Commonwealth Numbered Acts

PERSONAL PROPERTY SECURITIES ACT 2009 (NO. 130, 2009) - SECT 341

Control of inventory

             (1)  For the purposes of determining whether inventory is a circulating asset under section 340, a secured party has control of the inventory if:

                     (a)  the secured party and the grantor have agreed in writing that the grantor:

                              (i)  will specifically appropriate the inventory to the security interest; and

                             (ii)  will not remove any specifically appropriated inventory without previously obtaining the specific and express authority of the secured party to do so; and

                     (b)  the grantor's usual practice is to comply with the agreement.

Control of accounts

             (2)  For the purposes of determining whether an account is a circulating asset under section 340, a secured party has control of the following kinds of accounts (the relevant account ) in the circumstances set out in subsections (3) and (4):

                     (a)  an account mentioned in paragraph 340(5)(a);

                     (b)  an account that is the proceeds of inventory.

             (3)  The secured party has control of the relevant account if:

                     (a)  the secured party, and the person to whom the relevant account is owed, have agreed in writing that amounts paid in discharge of the relevant account must be deposited into a specified ADI account; and

                     (b)  the usual practice is for such amounts to be so deposited; and

                     (c)  the secured party controls the ADI account; and

                     (d)  depositing any such amounts into the specified ADI account does not result in any person coming under a present liability to pay:

                              (i)  the person to whom the relevant account is owed; or

                             (ii)  if the person to whom the relevant account is owed is a body corporate--a related body corporate (within the meaning of the Corporations Act 2001 ).

             (4)  If the secured party is a transferee of the relevant account, the secured party has control of the relevant account if payment by the account debtor to the secured party would discharge the obligation of the account debtor under subsection 80(8) to the extent of the payment.

Section does not limit meaning of control

             (5)  This section does not limit when a secured party has control (within the meaning of Part 2.3) of inventory or an account for the purposes of determining whether inventory or the account is a circulating asset under section 340.