- This topic has 1 reply, 2 voices, and was last updated 7 years ago by
.
- Posts
Hi Mike!
On 1 April 20×9 J created a fixed charge for $50,000 over the assets of Clogs LTD and it was registered on 1 June 20×9. On 1 May 20×9 a fixed charge was created over the same asset on behalf of A. A’s fixed charge was registered on 13 May 20×9.
Which of the following statements describes the priority of the two charges?
-The answer is “A’s fixed charge has priority as it was registered within 21 days of creation before J’s fixed charge”
1. Could you explain the idea of the answer?
– Does the general rule say the charge which was created first has priority?The general rule is that the charge that is created first has priority … but that only applies where two similar charges are properly created and properly registered within the 21 day period for registration
There is also the rule that states that a fixed charge always has priority over a floating charge on the same property but your example refers to two fixed charges, so that’s not an issue here
OK?
- The topic ‘charges’ is closed to new replies.