Getting your goods

What happens when your customer cannot pay for the goods you have delivered?

You may be able to recover those goods if you have a clause in your contract with the customer reserving ownership or in legal terms, 'title',  to the goods until the customer has paid for them. This is known as a 'retention of title' clause.

There are four basic types of retention of title provision:

- Simple – you keep title until you are paid for the goods.

- All Monies – you keep title until you are paid for all goods you have supplied to the customer.

- Manufactured – you look to keep title until payment even if the goods have undergone a manufacturing process by the customer.

- Proceeds – if the customer has sold the goods you look to keep title in the sale proceeds until payment.

Simple and All Monies provisions are the easiest to establish but in all cases it is essential that you can show that the provision was incorporated into your contract with the customer.  You also need to be able to identify the goods, normally by serial number or marking.  It is easier if you are the only supplier of those particular goods to the customer.

Even if you have already commenced legal proceedings against the customer for the invoice value of the goods and perhaps got judgment against them, you can still look to recover the goods, unless the contract provides otherwise.  Furthermore, a retention of title clause may still be enforceable if the customer is insolvent. If the goods are sold by any insolvency practitioner acting for the customer whilst your claim for their return is pending, you may be able to recover their value.

To claim the goods you need to:

- Identify the goods.

- Show that the contract reserves title in those goods to you.

- Establish the debt.

- Get confirmation that the goods will be retained in a specific, separate area and that you will be granted inspection facilities.

We can help you by giving specific advice on these matters and where appropriate, acting on your behalf to recover the goods. 

Where legal proceedings are not necessary we can charge on a contingent basis, whereby you only pay if we recover, the charge being a percentage of the invoice value of the goods.  If legal proceedings are necessary and we believe you have a good claim, we can charge on the basis of a conditional fee arrangement, linked to success.

When in doubt please contact a member of the team:

Nick Carr

0845 404 1520

nick.carr@cobbetts.com
                      
Jon Hainey

0845 165 5426

jon.hainey@cobbetts.com 
 
Keith Mills

0845 404 2426

keith.mills@cobbetts.com

The content of this briefing note is for information only and should not be relied upon as a substitute for legal advice. Copyright 2009 - All Rights Reserved - February 2009