Retention of Title

Retention of Title

A retention of title clause in a contract can be an extremely useful device for maintaining ownership of supplied goods until such time as certain conditions (often as to payment of monies owed) are met.

Retention of title clauses are complex legal mechanisms designed to retain ownership of goods and their effectiveness is often dependent on (i) a properly drafted clause and (ii) the fact specific circumstances of the case and what has happened to the goods in the meantime. Such clauses can, if drafted properly and properly monitored provide the supplier with security in the event that the buyer defaults on a payment or becomes insolvent.

In properly drafted contracts (and to an extent under the Sale of Goods Act 1979) the supplier could retain ownership of the goods even after they have been delivered, providing a retention of title clause is within the contract and has been signed by both parties.

In the event that the buyer becomes insolvent, the supplier could have a right to claim back any portion of unused goods from the liquidators.

Our lawyers specialise in complex contractual matters including retention of title clauses.

To find out more about the legal support we can offer, please contact us.

Luke Morgan

Supervising Partner, Litigation Team, Debt Recovery & Employment

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