Other mortgages

Authored by Andrew Mutton, Director and Sylvia Mansour, Associate, Cowell Clarke (NSW); Mark Gunning, Barrister, University Chambers and Marcus Young SC, Barrister, University Chambers; Sam Grindal, Director, Donaldson Trumble Legal (Vic); Luckbir Singh, Director, MacDonnells Law (Qld); Gary Thomas, Special Counsel and Anthony Davis, Director, McWilliams Lawyers (WA); Philip Page, Retired Partner, Mellor Olsson and Philip Page, Partner, Mellor Olsson (SA); Tim Tierney, Principal and Sebastian Thomas-Wilson, Principal, Tierney Law (Tas); Tony Morgan, Partner, Andrew Giles, Senior Associate, HWL Ebsworth; Richard Skopal, Principal, DWF (Australia); Lyn Bennett, Consultant, Minter Ellison and Leon Loganathan, Managing Partner, Ward Keller Lawyers (NT) and Stephanie Lynch, Partner and Christine Murray, Managing Partner, Meyer Vandenberg Lawyers (ACT). Updated by the LexisNexis Legal Writer team.

Mortgages over property and other rights, other than real property, have historically been governed by common law and statues enacted by each jurisdiction.

Now, a national scheme created through the Personal Property Securities Act 2009 (Cth) regulates the majority of mortgages, charges, and similar security interests over personal and other property (other than real property and with various exceptions).

Some of the more common types of “other” mortgages are explored in this guidance note.

Mortgages over chattels, goods, and similar

Traditionally, chattels and goods could be mortgaged in a similar fashion to old system land, but chattel mortgages were governed by Bills of Sale legislation in each jurisdiction. These Acts required not only signed instruments in writing, but also registration of those instruments. Unlike the case with Torrens land, the registration of a bill of sale effecting a chattel mortgage conferred no indefeasibility of title. However, failure to register the bill of sale in most cases rendered the mortgage unenforceable (the precise consequences varied in each jurisdiction and upon the type of bill of sale).

Since February 2012 a national scheme established by the Personal Property Securities Act 2009 (Cth) regulates chattel, goods and most similar mortgages.