Conceptual models of the PPSA security interest: Moving beyond the unitary/minimalist dichotomy

Abstract

This article explores the existing conceptual models of the "security interest" under the Personal Property Securities Act 2009 (Cth) – the "unitary model" and the "minimalist model". It reviews the elements of and rationales for the models, and their consequences which have been explored in the literature thus far. It then examines the potential variants of, and uncertainties within, the models. In light of these uncertainties, it is contended that the contents of the security interest cannot be reduced to a dichotomy; rather, each of the issues touched upon by the models of the security interest should be viewed as discrete albeit interconnected constructional questions. Consequently, the models should be restricted to the core issue in response to which they were developed, being whether (or not) certain parties are deemed to be owners for the purposes of holding "rights in the collateral" under s 19. It is further contended that, instead of adopting the proposed solution of expressing a preference for one of the models in the Explanatory Memorandum, the government should directly amend the legislation to address the key issues that flow from them.