Retention Of Title

RETENTION  OF  TITLE

A well drafted set of terms and conditions of business will include a retention of title clause.  The effect of such a clause enables a seller of goods to retain ownership of the goods supplied until payment has been received in full.  This can be of great value where the purchaser of the goods supplied becomes insolvent.

There are various types of retention of title clauses but the essence of a well drafted clause means that a seller will have added protection in the event of failure by the purchaser to comply with their contractual obligations and pay for the goods ordered.  In particular where a buyer subsequently goes into liquidation after acquiring stock which is subject to a retention of title clause, then the seller of the goods may be able to obtain the return of the goods notwithstanding the fact that the buyer has gone into liquidation.

A carefully drafted retention of title clause is a powerful tool to assert ownership rights and recover property.  They can however be complicated and need careful consideration.

Should you wish further advice on retention of title clauses, then please do not hesitate to contact Michael Lee on 020 8201 6299 or e-mail him at michaellee@leepomeranc.co.uk.

This note is intended to be a brief general guide only and should not be used or relied on as a complete or authoritative source of legal information.