Failing To Respond To PPSA Information Requests Proves Costly For Secured Lender

The Ontario PPSA¹ system allows secured parties to complete and file financing statements against debtors without their prior consent. To ensure the accuracy and appropriateness of the registrations made, the PPSA also gives debtors and third parties certain rights, including tools to obtain further details of the registrations made. One of those tools is Section 18 which allows debtors and third parties to request, among other things, that secured parties provide copies of the security agreement and details of the debt secured, and confirm the scope of the security interest claimed, in each case within 15 days of a request.² Section 18 is the provision that enables a prospective secured creditor to request PPSA estoppel letters or acknowledgments in the context of a proposed new financing.