IPCL (THINGS I KEEP GETTING WRONG)

Question 1

What’s the difference between the ACL and the SOGA when arguing goods weren’t fit for purpose?

Answer 1

• The ACL gives a non-excludable guarantee that goods must work for the buyer’s stated purpose — even in most business purchases under $100k.
• The SOGA has an older implied term for fitness, but it can be limited or excluded.
• In practice, the ACL now governs because it’s stronger, automatic, and modern

Question 2

If goods are bought for resale, can the ACL still help even though consumer guarantees don’t apply?

Answer 2

• Yes — because s 18 ACL bans misleading or deceptive conduct in any trade or commerce.
• Even if someone isn’t a “consumer,” they can still use this rule when marketing claims are false.
• Consumer guarantees protect end-users; s 18 protects everyone from deception.

Question 3

How does a PMSI affect an earlier-registered AllPAP?

Answer 3

• A PMSI has super-priority if it’s registered before or within 15 business days after the debtor gets the goods.
• It wins because the PMSI directly funded those specific items.
• If the timing is missed, the PMSI drops back to ordinary priority — the AllPAP wins.

Question 4

Why is timing everything for a PMSI?

Answer 4

• The PPSA rewards fast registration — a PMSI must be perfected on time to keep its advantage.
• Register late, and it loses super-priority, even if the lender technically owns the goods.
• Perfection timing decides priority, not who “owns” it in name.

Question 5

If two parties both have perfected security interests — one by registration, one by possession — who wins?

Answer 5

• Possession beats registration.
• It shows real-world control and prevents the debtor from using the asset twice as security.
• Registration just gives public notice; possession locks down the collateral physically.

Question 6

When do future goods become the buyer’s property under the Sale of Goods Act?

Answer 6

Future goods don’t exist yet when the contract is made — so no property passes until they come into existence and are clearly identified for that contract.
Until then, it’s only an agreement to sell, not an actual sale.

💡 Memory hook: “You can’t own what isn’t born yet.”

Question 7

What’s the difference between a condition and a warranty under the Sale of Goods Act?

Answer 7

A condition goes to the heart of the contract — breach lets the buyer reject the goods.
A warranty is minor — breach only gives damages, not rejection.
If the defect doesn’t affect function, it’s usually a warranty.

💡 Memory hook: “Condition = cancel; warranty = compensate.”

Question 8

What makes sales tactics “harassment or coercion” under the ACL?

Answer 8

It’s unacceptable pressure or threats that push a consumer to agree — like saying “the deal ends today” or “you’ll lose your money if you walk away.”
s 50 ACL protects against aggressive or fear-based selling, even if the contract looks valid.

💡 Memory hook: “Pressure kills consent.”

Question 9

What is unconscionable conduct under the ACL?

Answer 9

It’s unfair, one-sided behaviour by a stronger party that takes advantage of a weaker one.
Examples include forcing extra purchases or exploiting desperation.
It breaches s 21 ACL, which looks at the whole context — not just words in the contract.

💡 Memory hook: “Unconscionable = unequal power, unfair use.”

Question 10

When a business exaggerates how much others earn, what ACL rule applies?

Answer 10

That’s a false or misleading representation about profitability under s 29(1)(a).
It stops companies from luring investors or franchisees with fake success claims.

💡 Memory hook: “Promises of profit = prove it or breach it.”

Question 11

What happens to an unregistered security interest when the grantor becomes insolvent?

Answer 11

Under s 267 PPSA, any unperfected security interest vests in the grantor — meaning the lender loses it.
Even possession alone doesn’t save it; registration is key.

💡 Memory hook: “Unperfected = unprotected.”

Question 12

Can a buyer in the ordinary course of business take goods free of a security interest?

Answer 12

Yes — under s 46 PPSA, a buyer who buys in good faith and in ordinary trade takes the goods free of any perfected interest, even if they knew one existed.
It keeps commerce moving fairly.

💡 Memory hook: “Retail buyers take free — keep trade flowing.”

Question 13

Why is “control” considered the strongest way to perfect a security interest under the PPSA?

Answer 13

Because control gives total power over the collateral — the debtor can’t use, move, or deal with it without the secured party’s consent.
It’s more secure than possession (which can be lost) and registration (which only gives notice).
Control means the secured party literally controls what happens to the asset — like a bank with authority over an account.

💡 Memory hook: “Control beats paper and possession — because it locks the asset down.”

Question 14

How is “control” and “possession” different when talking about enforceability versus perfection under the PPSA?

Answer 14

For enforceability against the grantor (s 19–20), the secured party needs attachment plus either a security agreement, possession, or control — this just makes the interest legally valid.

For perfection, possession or control are extra steps that make the interest effective against third parties and stop it from vesting on insolvency.
So:

Possession/control (in enforcement) = proves the security interest exists.

Possession/control (in perfection) = gives it priority and protection.

💡 Memory hook: “Enforceability = makes it real. Perfection = makes it safe.”

Question 15

When is the ACL better to rely on than the SOGA?

Answer 15

Use ACL when the buyer is a consumer (goods < $100k or for personal use).
It provides automatic, non-excludable guarantees and easier remedies.
SOGA is better for business-to-business contracts where guarantees don’t apply.
💡 Hook: “ACL = automatic protection; SOGA = commercial fallback.”

Question 16

If goods don’t match their description, which Act is stronger?

Answer 16

Both apply, but ACL is stronger because it’s strict liability — the buyer doesn’t need to prove intention or reliance.
SOGA’s implied condition still applies but can be excluded by contract.
💡 Hook: “Same wrong, ACL hits harder.”

Question 17

How does the “fitness for purpose” rule differ between the SOGA and ACL?

Answer 17

SOGA: implied condition only if the buyer relied on the seller’s skill and the seller knew the purpose.
ACL: automatic guarantee for consumers; doesn’t require explicit reliance.
💡 Hook: “SOGA asks if you relied; ACL assumes you did.”

Question 18

Can a buyer rely on both the SOGA and ACL at the same time?

Answer 18

Yes — courts can apply both if the transaction fits both frameworks.
SOGA covers title and risk, ACL covers quality and fairness.
The buyer can plead them in the alternative.
💡 Hook: “SOGA for ownership, ACL for outcome.”

Question 19

Can a business use the ACL for defective goods bought for business purposes?

Answer 19

es — if the goods are under $100,000, or normally for household use, they count as a “consumer.”
The ACL doesn’t exclude commercial use unless for resupply or manufacturing.
💡 Hook: “Price tag, not purpose, defines the consumer.”

Question 19

How do remedies differ between the SOGA and ACL?

Answer 19

SOGA → contract-based: reject goods, rescind, or claim damages.
ACL → statutory: repair, replace, refund, or damages for loss (s 259–271).
ACL remedies are simpler and automatic, not dependent on contract terms.
💡 Hook: “SOGA = contract remedies; ACL = consumer guarantees.”

Question 19

What decides when ownership passes under the Sale of Goods Act?

Answer 19

It depends on the intention of the parties, read from the contract terms, conduct, and the Act’s default rules (ss 21–25).
If the goods are specific and in a deliverable state, property passes immediately once the contract is made — unless the parties clearly intend otherwise.
💡 Hook: “Risk follows title — unless the parties say stop.”

Question 20

How is risk different from property under the SOGA?

Answer 20

Property = ownership; risk = who bears loss.
Normally, risk passes with property — but parties can separate them by agreement (s 23).
So a buyer can own goods but not bear risk yet, or vice versa.
💡 Hook: “Who owns it isn’t always who risks it.”

Question 21

Why does it matter if goods are “specific” or “unascertained”?

Answer 21

Title can’t pass in unascertained goods until they’re identified and appropriated to the contract (s 21).
Specific goods already exist and are identified → title may pass straight away.
💡 Hook: “You can’t own what hasn’t been picked.”