Critically consider the case described in Business Decision 22.1 (MTL, 569) and answer the associated discussion question. Max 500- 600 words

- any lien created under any law - any creditor who has successfully obtained a judgment against the debtor and any creditor who has successfully obtained a judgment again Unperfected interests are also ineffective against anyone who represents the debtor's creditors and has control of the debtor's assets, such as a trustee in bankruptcy. 19 Secured creditors of a bankrupt debtor can enforce perfected security interests against the trustee. An unperfected security interest, however, is treated as an unsecured debt. As Chapter 23 discusses, when a debtor becomes bankrupt, a creditor with an unsecured debt is entitled only to share in whatever assets are left after the creditors with perfected security interests enforce their rights to the debtor's collateral. Each unsecured creditor will receive a share of the debtor's remaining assets equal to the proportion that the debt owed to that creditor represents of the debtor's total unsecured debt. For example, assume that a debtor owes $1000000, but has assets worth only one-tenth of that amount, $100000, and there are no creditors with perfected security interests. If you, as an unsecured creditor, were the only secured creditor with a perfected security interest, you would be entitled to seize $50000 of the debtor's assets, forcing the unsecured creditors to share the remaining A great advantage of PPS legislation is that it provides a system for determining who $50000. As a matter of risk management, you should perfect your interest. prevails when more than one secured party claims an interest in the same collateral. The relative priority of claims is often critically important. A debtor in default on their credit obligations usually does not have enough assets to pay off all of their creditors, so it matters whose security interest ranks first. A clear system of priorities helps creditors to manage their risks in two ways. At the time they make a decision about granting credit, manage their risks in two ways. At the time they make a decision about granting credit, they can find out what security interests the debtor has already given that will rank ahead of theirs by searching the register. With the benefit of this information, creditors can decide whether to advance credit to the debtor. Later, if there is a default, it is usually easy for the creditor to figure out whose security interest ranks first. Purchase Money Security Interests sion 22.1, the relevant date for determining the bank's priority in any contest with another secured party is the date of its registration, 15 September 2016, even though perfection did not occur until September 19. If another secured creditor had obtained and perfected by registration a security interest in Keeshon's assets on September 18before the bank had advanced any money - it would still rank behind the bank. PPS legislation considers only the date of registration in the interests of certainty. An unperfected security fected, is subordinate to: - any perfected interest - other unperfected interests that attached earlier 18. Eg, OPPSA, s 20; SPPSA, s 20 . 19. Eg,OPPSA,s20;SPPSA,s20. 19. Eg, OPPSA, s 20; SPPSA, s 20 . 20. PMSIs are defined in OPPSA, s1, and their super-priority is granted in OPPSA, s33. It is possible for creditors to enter into an agreement to fix the priority of their security interests in a way that is different from what PPS legislation would provide. Where a secured party agrees to a lower priority, the agreement is called a "subordination 17. Robert Simpson Cov Shadlock (1981) 119 DLR (3d) 417 (Ont HCJ). The rules are different where the secured legislation wot agreement