Estoppel Letter

Summary

This precedent is an estoppel letter which a new secured creditor should obtain from any secured creditor who has registered a financing statement under the Personal Property Security Act (“PPSA”) against the debtor prior to the new secured creditor’s PPSA registration if the prior registered financing statement does not clearly limit the scope of the existing secured party’s security interest to specified collateral. In the estoppel letter the existing secured creditor confirms to the new secured creditor that its security interest in the debtor’s assets is limited to specific collateral, and that it will not rely on its prior PPSA registration (or any other personal property security registrations) to perfect a security interest in any other assets of the debtor. An estoppel letter is most frequently required under the Ontario PPSA. While not typically required outside of Ontario, it may be desirable to obtain an estoppel letter in another province if, for some reason, the scope of a...