This appeal concerned a priority dispute under the Personal Property Security Act arising from refinancing of a printing press subject to a lease with an option to purchase.
The appellant bank discharged the original lender's security, enabling the debtor to obtain legal title, and then took its own security interest.
The court held that this financing enabled the debtor to acquire further rights in the collateral and therefore satisfied the statutory definition of a purchase-money security interest.
Because the statutory conditions for priority were met, the appellant's security interest ranked ahead of the respondent's earlier perfected general security agreement.
The appeal was allowed and priority declared in favour of the appellant.
