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ARTICLE · 05 FEBRUARY 2013

The Internet - How Public Access Impacts PPSA Notice Requirements

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An auction of goods held over the Internet may be considered to be a public auction for the purposes of giving notice under the PPSA.

CanadaFinance and Banking

The Take-Away

An auction of goods held over the Internet may be considered to be a public auction for the purposes of giving notice under the PPSA when a secured party is exercising a right of disposition. An Internet auction can have the “traditional” elements of a public auction, and if so, the time, date and place of the auction must be properly disclosed to all parties, including the debtor, entitled to receive notice of the intended sale. 

The Case: CNH Capital Canada Ltd. v. Diamond 4 Holdings Ltd., 2012 BCSC 942

Case Summary:

CNH Capital Canada Ltd. (“CNH”) sought judgment of $167,677.62 against Diamond 4 Holdings Ltd. (“Diamond”), being the deficiency amount owing by Diamond on a debt following CNH’s enforcement of its security rights in connection with the sale of two excavators (the “Equipment”). The Equipment was sold through an Internet auction service. After the sale, there remained a deficiency of $163,973.43 owing to CNH, for which it sued. 

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