Under the Art 9/PPSA system, you need figure out whether somebody has an interest in the goods. If so, then you ask, why does he? For what functional or economic purpose did he obtain or retain that interest? If to secure an obligation, then the Act is triggered. Depending on whether perfection steps have been taken, this may mean that the interest which he kept or acquired is one on which he can now not rely. And so he may end up as an unsecured creditor even though he retained, say, legal ownership. If, on the other hand (and this may be what Andrew is suggesting) you are an unsecured creditor, but along with that you happen to have an interest in goods, and that interest was not obtained or retained for the purpose of securing an obligation, then your ability to rely on the interest is governed by the general law and not the PPSA. And so you would be all right even if you had not registered.

In my own mind, if you say, why did Hallmark not transfer ownership to Ellingsen?, the answer must be, because H wanted to be sure of getting paid. If that is right (and there are other ways of characterising the facts) then I think the game is over if you live in PPSA-land and have not registered.

Jason Neyers said

Could you not say that the security interest was retained to ensure compliance with: 1) the obligation to secure financing; and 2) barring the fulfilment of that condition an obligation to return the truck?

(1) I am not sure there was an obligation to secure financing. In fact I doubt that very much. And I don't think (2) will work either. If the only reason an interest in goods is retained is to ensure the return of the very goods, the interest is not caught by the Act. It does not require the registration of every bailment.

Jason also said

In my opinion this is not a case for Unjust Enrichment at all as a juristic reason, i.e. the contract, justifies any loss / deprivation.

The problem is that the majority decided that the contract was subject to a condition precedent which was not fulfilled, so that there was in a sense no contract governing the relationship.

There may be an analogy with "sale or return". In fact whatever one decides for this case must govern a contract of "sale or return." It is notorious that Canadian PPSAs are not well-integrated with sales law, which is basically the 1893 English Act in most provinces.

If anyone is so captivated by all of this that they feel the need to write a case note, please be in touch as I know one editor who would like one.

Lionel

PS to Andrew: I think we are talking about what we in North America would call a pickup truck ... a ute or a combi in different parts of the world but surely not a lorry??