Home Law Implementing the Cape Town Convention and the Domestic Laws on Secured Transactions
Priority Among Secured Interests
South Africa became a signatory to the Convention on the International Recognition of Rights in Aircraft, and incorporated same in domestic law through the promulgation of Convention on the International Recognition of Rights in Aircraft Act 59 of 1993 (“RAA”).6 Section 4 of the RAA provides for the creditor to register a security interest on an aircraft or share in aircraft, including spare parts and engines, where a loan or debt is acquired. A deed of mortgage is thereby created as evidence of such a security interest. The Director of Civil Aviation is authorized, upon production of such an instrument and payment of the prescribed fee, to record the mortgage in a register created for such purpose.
The Director records the mortgage in the order in which the deeds creating them are provided to him. They are endorsed with the date and time of that record. Where a mortgage is to be executed outside the Republic, a registered owner of an aircraft or share must apply to the Director for a certificate of mortgage. The certificate contains a statement of any registered mortgages or certificates of mortgage affecting the aircraft or share in respect of which the certificate is given. Section 6 of RAA provides that priority of mortgages in respect of the same aircraft shall be determined in accordance to the date and time at which each mortgage is recorded not when it was executed. Thus, registration presumably affects the priority among creditors on a “first in line” basis.
|< Prev||CONTENTS||Next >|