Critical evaluation of the UK governments' reforming the law of Essay

Critical evaluation of the UK governments' reforming the law of company charge registration - Essay Example The term security interest is used in two different contexts including consensual security, which exists through contractual agreement and legal security, which exists by operation of the law. A further classification breaks the term into quasi security and real security whereby the real security is about the grant of an interest through security while quasi security is concerned with gaining of recourse against some form of proprietary interest rather than through a grant (BIS, 2011). Some of these issues were addressed by the common law based on estoppels principles and the rule in Dearle v Hal, though none of them was successful. This problem only became manageable following introduction of registration systems, which were enshrined under the Bills of Sale Acts in respect to individuals as well as Company Acts (Secured transactions in securitizations, 2009). Nevertheless, these registers could not meet the radically changing commercial environment. One of the areas that have cause d numerous problems recently includes the recognition of the consumer debtor. Although several consumer credit laws have been enacted to regulate such debtors, the major problems that have been presented in the business sector have not been surmounted, yet the Companies Act 2006 has not done enough to address the problem (McCormack, 2009). The evolution and early regulation of security Before the industrial revolution, the English economy was mostly dominated by agricultural economy which was particularly practiced in the rural areas. By then, security of interest was primarily concerned with the possession of instruments of promise and the lien was only concerned with forms of security interest that were accepted. Actually, the major way of marking the passage of property was through transfer of possession. By then, the main method of exchange was barter since the coinage had not been established. Therefore, the era, which was technologically challenged, was only left with physical dominance of property through possession as the only real way of expressing implicit ownership of property. In this system, passage of ownership through contract was unheard of since the property transfer was via physical delivery or rather the assumption of possession. From the modern perceptive, this form of description is unacceptable since it is not recognized in the legal and the economic model in which the society is based. Furthermore, if the legal system were to be entirely based upon possessory principles, then the commercial activities which are premised upon a liberally existing exchange of goods and services would be fundamentally frustrated. However, proprietary assignments in England have been recognized through possessory concepts which existed until the mid-nineteenth century (Birds, 2007). Notably, had the promissory rules remained unchecked, the modern industrialized economy could not have reached its current evolved status, which is fueled by a free supply of cre dit. Furthermore the economic growth could not have been achieved were it not for checking the susceptibility of possessory security interest. The severance of title and