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WCC73
21-03-2009, 01:20 AM
Scenario
You install some splits into a customers premises and you cant get payment for works.
No point going down Legal route as customer is very likely to go bankrupt.

Is there any way that you can legally reclaim the kit( i know it depends on T&C's but suppose they say goods remain property of ... until paid for in full)

Would be interested to hear opinions

Toosh
21-03-2009, 08:52 AM
Scenario
You install some splits into a customers premises and you cant get payment for works.
No point going down Legal route as customer is very likely to go bankrupt.

Is there any way that you can legally reclaim the kit( i know it depends on T&C's but suppose they say goods remain property of ... until paid for in full)

Would be interested to hear opinions

Hi, there is a guy called Abe on this site hes a Legal Eagle he will keep you right

Norm :D

LRAC
21-03-2009, 09:00 AM
Is it a sole trader or limited company?

Retention of Title

Introduction
i What is retention of title?
A “retention of title” clause is a clause that allows the supplier to retain ownership over the goods supplied until such time as certain conditions are met, thus providing the supplier with a form of security against the buyer's default or insolvency. A retention of title clause is sometimes known as a Romalpa clause or as a reservation of title clause.
Under the Sale of Goods Act 1979, where there is a contract for the sale of specific goods, the supplier can retain his right to ownership of those goods even though they have been delivered to the purchaser as long as all parties to the contract agree to this provision. For example, if it is stated in the contract, the supplier may retain the title to the goods until full payment is received. When valid, the supplier’s claim to any unused goods will be binding against any trustee or liquidator subsequently appointed.
NB To be valid, it is imperative that the retention of title clause is incorporated into the contract which exists at the time of supply. This may be included in the “small print” on the front or rear of the purchase invoice or delivery note.

"note the unused statement"

tonyh
21-03-2009, 10:09 AM
Hi I recently had a similar situation with a pub it would have been a waste of money going the legal route as you are further out of pocket and they still dont pay, after four months of broken promises I managed to get access to the outdoor units and took the boards out within two weeks I had an offer of payment on weekly payments. Before putting units back on I made sure he signed an agreement to pay arrears with interest and should he fail any payments they grant full & unimpeded access for the removal of the units and any making good was down to them, so far they are still paying. The moral of the story is you must have your terms & conditions water tight and signed by the customer of there acceptance.

frank
21-03-2009, 11:08 AM
I was advised some years ago that the minute you install the kit into the fabric of the building, the kit becomes part of the building and ownership of the goods passes legally to the building owner, paid for or not.

I'm not sure if this is still the law today.

Abe
21-03-2009, 01:09 PM
Hi, there is a guy called Abe on this site hes a Legal Eagle he will keep you right

Norm :D

:D

Good to see I get recommendations from beautiful New Zealand.......!!

Please tell me what the value of the work you have carried out is:

I will give an insight into (ROT) retention of title and ownership matters a little later.

I await details on the value

Regards
Abe

eggs
21-03-2009, 04:27 PM
My way around this problem is to always insist on staged payments. 30% up front, 40% on start of works and 30% upon completion. This works when you are working direct to the client.
If you are unfortunate enough to be working for M&E contractors then i suggest staging your kit deliveries, indoors installed, get paid, outdoors installed, get paid, commission, cross your fingers and hope.

I have found that any genuine clients/M&E contractors are more than willing to do this and if they are not; why not? Do they not have the funds in place to pay you upon completion?

Sorry it's not much help to your current problem, but for me, legalities and terms and conditions mean nothing in the current climate.
See the green backs, before you get out the spanners.

Sure you will lose a lot of work insisting on these payment terms, but..............there is a credit crunch, what are you a fridgeman or a bank?

eggs

Toosh
21-03-2009, 09:17 PM
:D

Good to see I get recommendations from beautiful New Zealand.......!!

Please tell me what the value of the work you have carried out is:

I will give an insight into (ROT) retention of title and ownership matters a little later.

I await details on the value

Regards
Abe

You are very wlcome Abe

Reagards Norm

Magoo
22-03-2009, 01:07 AM
Suggest as in NZ the romalpa clause. Which states title to equipment is transferred on full and final payment, should be clearly stated on each invoice. That gives you the right to rip it out if unpaid, entry to site and removal is a right by law. OK you loose the labour content , but at least you still own the equipment the real cost.
Just a thought from down under.
magoo

Magoo
22-03-2009, 01:24 AM
Reminds me of a bloke I worked with as a contractor, he was straight up and down, and a hard arsed supplier. A client of his with a posh restuarant was struggling finacially, excuses every month, Boss has had enough and organises a repo at 4.00am in the morning, cranes etc., ladders up the side a building cut and removal. His client had balls to complain about his chiller not working, justice is sweet but expensive. Within 10 days the client was in receiveship for half a million dollars, the receiver paid 0.08 cents in the dollar. The boss resold gear and got most of money back.
magoo

desA
22-03-2009, 04:40 AM
^ Perfect timing, it seems. :)

Abe
22-03-2009, 12:49 PM
WITHOUT PREJUDICE

WCC

This area is governed by the Sales of Goods Act.

Things to note:
Are the AC's classed as specific goods or unascertained goods? ( This area is complex and I will not go into it in detail)

Passing of property to buyer
Its important to assertain if property has passed to the buyer. ss 16 -19 of the Sales of Goods Act

If goods are unascertained, property in goods cannot pass to the buyer.

The rule in s18 is that:
where there is an "unconditional" contract for the sale of "specific goods" in a "deliverable state" the property in the goods passes to the buyer when the contract is made.

I shall not dwell on the complexities without knowing the terms of the contract or the basis of sale in this case. In my without prejudice opinion the installed equipment was ascertained, specific , the sale executed with intent and the property has passed to the buyer.

unless, you can advise me that both parties had agreed to a term that "ownership would not pass" without full payment.

How to get your monies back, or the goods back. You can claim for breach of contract where the consideration or "payment" has not been made to you.
if the value is under £5000.00 then its a simple claim in the county court. Use claim form N1. The fee will be £120.00.

You do not need a Solicitor , you can represent yourself and the case will be dealt with in chambers.

If the value is over £5000.00 to £15,000 , then I suggest you instruct a Solicitor. Over 5k, if you lose the case there will be a costs implication on you, ( u pay the winners legal costs)

You will also need a legal person to draft your pleadings. You are looking at around £1000.00 to £1500,00 in fees for the initial work, (drafting the claim, issuing, allocatio, case management) depending how long the case stretches out or goes to full hearing.

You looking at another £1000.00 for the hearing itself.

So the answer to your questions are:

No, you cannot go and take your AC's out. Ownership may have passed to the buyer.

You may also be charged with tresspass.

Company going bankrupt.
More reason for you to issue a claim. At least if the company goes bust, you become a creditor and will get "something"

Hope this helps.

WCC73
23-03-2009, 12:46 AM
Sorry for the delay, been working all weekend.

Invoice was for some boards, comps etc to some splits.I'm pretty sure that ownership passes on installation of parts.
Not going to be worth going legal as complicated co structure and massive debts mean i'm likely to end up with something shi**y like 10p in the pound if i'm lucky, so i dont feel its worth the hassle of time and money.
What i dont want is the barsteward to have the benifit of MY goods when he inevitably starts trading again with a slight change in name, wife becoming co secretary etc.

desA
23-03-2009, 02:48 AM
^ Send in your not-so-friendly contract knee-breaker... :)

Abe
23-03-2009, 05:32 PM
Not going to be worth going legal as complicated co structure and massive debts mean i'm likely to end up with something shi**y like 10p in the pound if i'm lucky, so i dont feel its worth the hassle of time and money.


You dont have to go the legal route as the Adminestrator/ Insolvency Practitioner will pick up your invoices and you will automatically be a creditor, along with the others.

Good luck

Andy
23-03-2009, 10:22 PM
WITHOUT PREJUDICE

WCC

This area is governed by the Sales of Goods Act.

Things to note:
Are the AC's classed as specific goods or unascertained goods? ( This area is complex and I will not go into it in detail)

Passing of property to buyer
Its important to assertain if property has passed to the buyer. ss 16 -19 of the Sales of Goods Act

If goods are unascertained, property in goods cannot pass to the buyer.

The rule in s18 is that:
where there is an "unconditional" contract for the sale of "specific goods" in a "deliverable state" the property in the goods passes to the buyer when the contract is made.

I shall not dwell on the complexities without knowing the terms of the contract or the basis of sale in this case. In my without prejudice opinion the installed equipment was ascertained, specific , the sale executed with intent and the property has passed to the buyer.

unless, you can advise me that both parties had agreed to a term that "ownership would not pass" without full payment.

How to get your monies back, or the goods back. You can claim for breach of contract where the consideration or "payment" has not been made to you.
if the value is under £5000.00 then its a simple claim in the county court. Use claim form N1. The fee will be £120.00.

You do not need a Solicitor , you can represent yourself and the case will be dealt with in chambers.

If the value is over £5000.00 to £15,000 , then I suggest you instruct a Solicitor. Over 5k, if you lose the case there will be a costs implication on you, ( u pay the winners legal costs)

You will also need a legal person to draft your pleadings. You are looking at around £1000.00 to £1500,00 in fees for the initial work, (drafting the claim, issuing, allocatio, case management) depending how long the case stretches out or goes to full hearing.

You looking at another £1000.00 for the hearing itself.

So the answer to your questions are:

No, you cannot go and take your AC's out. Ownership may have passed to the buyer.

You may also be charged with tresspass.

Company going bankrupt.
More reason for you to issue a claim. At least if the company goes bust, you become a creditor and will get "something"

Hope this helps.


Sorry for the delay, been working all weekend.

Invoice was for some boards, comps etc to some splits.I'm pretty sure that ownership passes on installation of parts.
Not going to be worth going legal as complicated co structure and massive debts mean i'm likely to end up with something shi**y like 10p in the pound if i'm lucky, so i dont feel its worth the hassle of time and money.
What i dont want is the barsteward to have the benifit of MY goods when he inevitably starts trading again with a slight change in name, wife becoming co secretary etc.

Hello WCC73:)

I suppose it all depends on how much value you put on the parts supplied and if you want to send out a message to anybody who would wish to rip you off in the future.
Me I would risk arrest to recover the outdoor boards. Mostly if you do it in broad day light without breaking in the police will deem it a civil matter and not intervene.

If you go at night and scale a fence to recover the goods they would probably arrest you.

If challenged be firm, you are there to recover your goods and your not leaving without them, but don't get angry or involved in a fight and go with back up, mob handed is best.

Kind Regards Andy D

R1976
23-03-2009, 10:46 PM
I got diddled for 10K last year:mad:.

Passed all invoices and statements to receivers and I never heard anything, I assumed there was no money to pay me. What can I do?

Magoo
24-03-2009, 03:21 AM
You own the parts, you are not paid. Go and rip them out and say "sue me if you want to., see you in court big fella " If your client is in the poop , your issue will be the last thing on his mind, OK you have lost the labour content. Next option is to bag the client with-in your local service people and insure no-one else gets screwed, doesnt pay the rent, but one less tosspot in the system
magoo

multisync
24-03-2009, 06:34 AM
From The Times

December 13, 2008



<H1 class=heading>Temperatures are rising among Folio's creditors




Dominic Walsh: City Diary


div#related-article-links p a, div#related-article-links p a:visited {color:#06c;}The collapse into administration of Folio Hotels, a privately owned chain of 36 three and four-star hotels, has caused a bit of a stir among the company's creditors. My suggestion that current management were hoping to regain control of some of the hotels has, to say the least, gone down rather badly.
The list of creditors is said to include a host of suppliers ranging from florists to cleaning firms and landscape gardeners. I have been told of one building contractor doing hotel refurbishment work for Folio that has been forced to lay off staff as a result of the collapse.
Others owed money are thought to include HBOS, the taxman and Matthew Clark, the drinks group, while there are stories that an air- conditioning firm that had supplied a £600,000 system to one of its hotels had to be physically restrained from trying to take back the main unit.
Nobody at either Folio or MCR, the insolvency firm handling the administration, will say very much but it is clear that the group's army of creditors is not going to go quietly. I am told that at one hotel the gardeners have ripped out all the plants and made off with them.


</H1>

desA
24-03-2009, 07:30 AM
Isn't the 'law' absurd? It never protects the wronged party, always the perpetrator.

The owner will start again under a different guise & steal again.

Abe
25-03-2009, 01:29 PM
Isn't the 'law' absurd? It never protects the wronged party, always the perpetrator.

The owner will start again under a different guise & steal again.

Im a bit disturbed the views I glean from this thread, where there are comments like, go in and take the stuff out, send the knee crushers in, etc........

I was reading in the paper last night where a builder took the law into his own hands about a burglar who nicked his gear, he reported a matter to the police, where they told him they would attend to the matter in a couple of days.

The builder couldnt wait, he went round, picked up the burglar, took him round to his accomplice and roughed them up.

The Police "immediately" sprang into action, picked up the builder and they are now in prison for 12 months.

So, my opinion remains, keep to the right side of the law.

It also transpired that where we were originally told that the gear was installed air conditioners, it was later revealed it was "parts" installed, ie, compressor, etc.

My opinion would probablyt have been a lot different if the clear facts were stated at the onset.

I went on about goods being either specific or unascertained. It may as well be that these components are unascertained and not specific as I had determined.

So, essential that the proper facts are presented right at the beginning.

Regards

LRAC
25-03-2009, 03:16 PM
Join the club people we got took for a total of £ 50,000 this year alone with various companies going bust.

cadwaladr
25-03-2009, 10:14 PM
get money up front to cover your outlay if that is not ok with your client walk away let someone else take the risk better to run away and fight another day

WCC73
26-03-2009, 12:41 AM
It also transpired that where we were originally told that the gear was installed air conditioners, it was later revealed it was "parts" installed, ie, compressor, etc.

My opinion would probablyt have been a lot different if the clear facts were stated at the onset.

I went on about goods being either specific or unascertained. It may as well be that these components are unascertained and not specific as I had determined.

So, essential that the proper facts are presented right at the beginning.

Regards
My apologies Abe.

The work was supplying and fitting a couple of comps and boards to some existing kit( coincidently spoke to a pal of mine who was owed money from same company and after much pressure from solicitors got payment.It would appear others aren't so lucky as looking at recent credit history there have been a number of CCJ's against company.Certainly looks like they are running up the debts and preparing to go pop)

Magoo
26-03-2009, 01:17 AM
Thank you Abe for your sense and sensibility and facts about keeping with in the law of the land.
Something to consider though, and keep in mind. Most people on this site are contractors or small business operators, and exist from hand to mouth as they say. We work huge hours and do all the right things, have creditors and tax department in our face daily, add a family to support [ which is my personal focus ]. Then you look at bad debtors list and get mongrel and into survival mode.
Most contractors and small business operators are on the end of the food chain when it comes to being paid for services, and generally are easy pickings for creditors and tax departments, due to lack of legal support due to costs envolved. Hence most small business operators fail within five years.
Magoo rambling again

desA
26-03-2009, 05:40 AM
The interesting thing about the legal arguments that have been presented here, is that the system in the UK seems to favour the defaulter, & not protect the small man. This is totally wrong, in my view.

In Asia, matters are dealt with a lot more sternly - I mean, much, much more sternly. This sends out a message to would-be charlatans & thieves. Major charlatans often end up in a canal - I joke not.

Perhaps the UK should take a look at the fairness of its legal system & begin to err in favour of the common man? Anyway, just a few thoughts - not to be taken too seriously.

Toosh
26-03-2009, 08:49 AM
The interesting thing about the legal arguments that have been presented here, is that the system in the UK seems to favour the defaulter, & not protect the small man. This is totally wrong, in my view.

In Asia, matters are dealt with a lot more sternly - I mean, much, much more sternly. This sends out a message to would-be charlatans & thieves. Major charlatans often end up in a canal - I joke not.

Perhaps the UK should take a look at the fairness of its legal system & begin to err in favour of the common man? Anyway, just a few thoughts - not to be taken too seriously.

Hi Desa, The best way in contracting is 50% to buy equipment 25% onsite payment 25% on completion is a sure way to get some money at least

Norm

nike123
26-03-2009, 01:04 PM
I have been sentenced for 2 year conditional because I asked my money. Nobody injured, just some verbal pressure. Guy, still enjoy my goods (and from many others in total of about 1 million €) after 8 years without payment.
That is picture of our comedy which we call here justice system.
Now I work illegally, with full payment in advance, no contracts only handshaking. That is much more secure way than work with legal system.;)
Little less job, but 0 € debts.

desA
26-03-2009, 02:27 PM
Hi Desa, The best way in contracting is 50% to buy equipment 25% onsite payment 25% on completion is a sure way to get some money at least

Norm

Makes a lot of sense.

I'd imagine that what you stand to lose is your profit.

On specialist equipment manufacture in South Africa, I used to ask: 60% down, 30% before release ex-works, 10% upon successful commissioning, or 10 days after leaving works, whichever was the soonest. Worked very well.

Abe
26-03-2009, 05:41 PM
Join the club people we got took for a total of £ 50,000 this year alone with various companies going bust.

If I was a judge, I would question the business logic of a firm that extends a line of credit without taking into account the extent of that companies limitations on liability.

A Bank will ask for security or collaterol and issue a registered charge against that asset. This is usually a property, so the charge can be registered with the Land Registry.

If the debtor cannot pay they immediately they have something at least.

In the absence of taking some form of charge, you take a risk, a gamble.

The risk did not pay off, the company lost the game or bet.

Next time you do a job, obtain some security, might be an expensive car, or machinery, even property....

Draw up a deed, if they dont pay you have a preferential right to this, and its yours.

The best way of course is as always........50 % with order.

Phased payments............or 25% somewhere along the line and the last 25% at end.

Even if you lose the last bit.........you still solvent and come away with your wages at least, if not profit.

Abe
26-03-2009, 10:32 PM
I have noted recently that the governments enterprise board are increasingly taking companies through the criminal courts where it is deemed that directors have acted fraudulently or traded wrongfully.

I am engaged on a matter at present where a director failed to coooperate with the insolvency practitioner and failed to provide accurate accounting records to Companies House

It might now be getting harder for companies to just willy nilly shut shop and start up again.

desA
27-03-2009, 02:06 AM
^ Excellent comments, Abe.

Would you be able to expand a little further on practically how a contractor could secure something against a job, in the form that a bank does as an alternative to an up-front payment? This could open up some interesting thoughts for contractors reading this thread.

The problem is that contractors are often desperate for work, don't check the customer's credit-worthiness & go in on 'good-faith'. This can often be a disaster.

Magoo
27-03-2009, 04:32 AM
Abe the moderator.
Perhaps you could pen a blank sheet that small business operators and contractors can have filled in by end users, that will even half cover equipment ownership until payment is acheived and clarified.
Just a thought. Magoo

LRAC
27-03-2009, 08:37 AM
It might now be getting harder for companies to just willy nilly shut shop and start up again.

HMRC are currently delaying all new applications for VAT registration in a bid to stop pheonix or prepacks being opened for bankrupt companies re-starting.

At this moment the thread is about us loosing money and suffering the conesquences of going bust as the debts from non payers increases. I would advise all who visit this forum to open a new company with VAT registration just incase one day you suffer a large debt that is not manageable through no fault of your own, even if the new company stays dorment.

Lets face it we all have families and mortgages to look after. I attended court the first time 2 weeks ago in seeking payment from a client for the remaining instalement of a completed installation, we won judgement and the judge asked the individual if he could make payment within 14 days at this point he informed the Judge they were unable too pay the monies owed. He declared bankruptcy the following day, so we ended up with nothing again.

The following week we were informed that the business was being continued by his father and no existing debts would be honoured, i did feel angry but after sitting down and thinking about it, i would have to do the same thing if i wanted to keep my house etc. They had suffered a large debt and its just a domino effect.

What would you do if you knew you had a good business but suffered a large debt which meant hardship for you in paying the suppliers bills or starting a fresh with a clean bill of health?????????

Abe
27-03-2009, 06:55 PM
With the tens of hundred thousand registered companies, it can prove difficult if not impossible to prosecute every company that shuts down owing a shed load of debts and then starting up again under a new name and board.

The resources to police this kind of thing in my opinion is just not there considering the huge legal fees that would have to be expended in gaining a prosecution.

Hence, the precedent that a lot of companies can "get away" with it, leaving the unfortunate contractor chasing up his payments.

As LRAC points out, most contractors are competing in a market and vying for business during difficult trading conditions, just so you can pay wages and pay the bills.

The last thing you want to be doing is making the buyer sign on dotted lines reams of paperwork, ( eying his flashy ferrari parked in the back !) and making them feel nervy, when Joe Bloggs hanging in the wings is prepared to do the same job without any agro.

I think you pick up a gut feeling about a job, and sometimes things dont work out and you lose. What I think we have gleaned is that when contracting with ltd companies , take extra heed.

Do a quick and cheap search on companies house, its very revealing. If the results show the company to be doing badly, or recently incorporated or movements in Directors, etc, you are easily warned and you take the appropriate stance.

With partnerships and sole traders its a lot easier, if they have assets, they will be loathe to risk these and will quickly pay up especially when you litigate.

With every sale do a standard terms and conditions with a ROT clause in, at least this way you can walk in (within certain confines and conditions) and claim title to your goods.