Suppliers to WOW Sight and Sound, a chain of stores which sold electrical consumer goods in Queensland are the first major casualties of the recent personal property securities reform. The company went into receivership in February 2012. The majority of its suppliers have been informed by the receivers that they are unable to reclaim their goods supplied on retention of title terms as they did not register their security interests on the Personal Property Securities Register (PPSR).
The receivers intend to sell the remaining stock at heavily discounted prices and distribute the proceeds of sale to the creditors in order of priority. The affected suppliers who failed to register are unsecured creditors who will not recover their stock and may not receive anything from the proceeds of sale.
Suppliers of goods seeking to rely on retention of title clauses need to consider registration of their Purchase Money Security Interests on the PPSR. Registrations need to take place within the strict time limits required under the Personal Property Securities Act. Correct registration will ensure that their interests are secured and that they have a super priority with respect to the supplied goods.
If you would like further information please contact Andrew Pickles.