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Security
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Something given to ensure the payment of a loan.
In Alberta Treasury v Minister of National Revenue, Justice Cory of Canada`s Supreme Court adopted these words:
"(S)ecurity is something which is given to ensure the repayment of a loan.
"The term security interest means any interest in property acquired by contract for the purpose of securing payment or performance of an obligation or indemnifying against loss or liability.
"A security interest exists at any time if, at such time, the property is in existence and the interest has become protected under local law against a subsequent judgment lien arising out of an unsecured obligation, and to the extent that, at such time, the holder has parted with money or money’s worth. "
In Fournogerakis, Justice Holmes wrote:
"(S)ecurity ... would normally be expected to relate to a pledge to guarantee fulfillment of some type of obligation."
A mortgage is a common security, pledging a piece of real property in regards to the payment of a loan according to its terms. Stocks and bonds serve often as security.
The security is distinguished from the debt itself.
In the civil law, security is known as gage.
In the law of negotiable instruments, the term is also used in the singular tense of securities; or to refer to any negotiable instrument.
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