PPS and leasing – the simplified version

There are a lot of people in the real estate industry struggling to understand what PPS is all about and how and why it is relevant to leases of real estate. Well here is a simplified explanation.

Background

"PPS" stands for Personal Property Securities and "PPSA" is the Personal Property Securities Act. The purpose of the Act is to enable parties to protect their "security interests" in personal property. Personal property covers just about any kind of property you can think of, whether it is used for business purposes or for personal or domestic purposes, but not real estate. That's because security interests over real estate are protected by way of mortgages registered at the Titles Office. Personal property can include cars, boats, aircraft, livestock, crops, bank accounts, investments and other financial property, and intellectual property such as trade marks and designs. We'll refer to this kind of property as "goods" to avoid confusion with real estate.