Problems with the PPSA register continue
Business Succession Update – Summer 2013
The capacity to register an unambiguous security interest against a trust as grantor where the trust does not have an ABN is diminished because the only way a security interest against a trust can be registered with clarity is if the trust has an ABN.
If it has no ABN, then one must register the security interest under the descriptor ‘Other’ and then type in the name of the Trust.
If the name of the trust subsequently changes and/or the trustee subsequently changes, the capacity to exercise recovery rights against the trust can diminish to almost zero.
Beware of lending to trusts!