Hire purchase act an act to amend the law with respect to the hire purchase and sale upon credit of goods. Waragowski 1 occupies only four pages in the weekly law reports, the decision raises important points of law. The hire purchase act, 1972 defines a hire purchase agreement as an agreement under which goods are let on hire and under which the hirer has an option to purchase them in accordance with the terms of the agreement and includes an agreement under which. The agreement must fulfil legal requirements of the indian contract act 1972 and the sale of goods act 1930, as the case may be. Hire purchase agreement includes a letting of goods with an option to purchase and an agreement for the purchase of goods by instalments whether the agreement describes the instalments as rent or hire or otherwise, but does not include any agreement. Singapores hirepurchase act protects the rights of hirers and owners alike. Law of hire purchase consumer credit a contract with a minor. Oownero means the person who proposes to let, lets or has let goods to a hirer under a hirepurchase agreement and includes a person to whom the owneros property in the goods. In the united states the differences between the various types of personal property security agreements have been considerably reduced by uniform legislation that deals with all of them under one heading. A hire purchase is a transaction where the hirer pays a certain instalment a month to the owner and enjoys the immediate use of a certain good.
Hire purchase agreements legal news in india, law firms. The seller in the hire purchase agreement who sell the goods on the hire basis. If the hirer shall duly observe and performs all the conditions herein. The owner of goods is known as hiree and the person to whom goods are given is. Still on the formality for hirepurchase, the provision of section 22d of the hirepurchase act is unclear. Other analogous practices are described as closedend leasing or rent to own. The kenyan hire purchase law is governed by the principles of the english common law as modified by the hire. How does the hirepurchase act protect consumers in singapore. The amount to be paid if the goods are purchased under the hire purchase system. Hire purchase law is provided in the hirepurchase act 1967 which came into force on 11 april 1968 and the consumer protection act 1999 which came into force in november 1999. Thus, in 1965, the hire purchase act was passed into law to regulate contracts of hire purchase in nigeria. The hirepurchase agreement needs to be in writing and signed by all parties involved in the agreement.
A hire purchase hp, known as installment plan is an arrangement whereby a customer agrees to a contract to acquire an asset by paying an initial installment e. Where a third party who is usually not a part of the hire purchase agreement has obtained a good title of the goods comprised in a hire purchase agreement by acting in good faith and honest intention, the owner has no right of recovery of the goods. The buyer in the hire purchase agreement who purchases the goods on hire basis. Duty of owners and sellers to supply documents and information.
Terms and conditions definitions hire purchase agreement means the agreement entered into between the hirer and the owner in relation to the goods the agreement goods means those goods that are set out in the schedule to the agreement hire purchase price means the total sum payable over the life of the hire purchase. Copyright ministry of legal affairs, government of the republic of zambia. This is not a contract of sale but contract of bailment as the hirer merely has an option to buy the goods. Initial payment made at the time of signing the hire purchase agreement. Duty of hirer to give information as to whereabouts of goods.
Laws of kenya the hire purchase act chapter 507 revised edition 2010 1982 published by the national council for law reporting with the authority of the attorney general. A hire purchase agreement is a legal document which includes clauses stating the terms and conditions between the parties. Hire purchase private law economies free 30day trial. It was a private members bill based on the english hire purchase act, 1965. In nigeria, the common law rules in relation to hire purchase were in operation. Borrie in his book titled commercial law, a hire purchase agreement is an agreement by an owner of goods to hire them out to a hirer and to give the hirer an. Still on the formality for hire purchase, the provision of section 22d of the hire purchase act is unclear. A hire purchase agreement is an agreement whereby the owner of a chattel lets it on hire to a hirer for a fixed period and agrees that upon the happening of a stated event usually, but not necessarily, the exercise by the hirer of an option to purchase property in the chattel will pass to the hirer. A hire purchase agreement is a legal document which includes clauses stating. Hirepurchase act ministry of justice government of. Requirements relating to hirepurchase agreements and creditsale.
This paper is an expose on the legislation regulating hirepurchase transactions in nigeria. Hire purchase agreement is a contract whereby the owner of goods hires them gives out to another person known as the hirer and gives him the option to purchase the goods. The law regarding this subject has been codified by the parliament in 1972, viz. Conditions and warranties to be implied in hirepurchase agreements. Hire purchase hp or leasing is a type of asset finance that allows firms or individuals to possess and control an asset during an agreed term, while paying rent or instalments covering depreciation of the asset, and interest to cover capital cost. Section 42 provides t hat where the hirer expressly or by. A hire purchase agreement has three basic features. Law and the hire purchase regulations, 1968 offer only partial protec tion for the hirer, who may be, had al most finished paying t he hire purchase price, bu t was left with one or two. Jun 15, 2016 a hire purchase agreement has three basic features. For instance, when you buy and pay for a car via monthly instalments. A delivery of personal property by one person the bailor to another the bailee who holds the property for a certain purpose a contract of hire purchase also has this element. Hire purchase law is provided in the hire purchase act 1967 which came into force on 11 april 1968 and the consumer protection act 1999 which came into force in november 1999. The elements of a hire purchase contract law teacher. The use of real estate financial markets and risk in capital marketing i require assistance and help with these valuations, to allow me to write up a report on the company and to learn from the method used.
Hire purchase act an act to amend the law relating to hire purchase, bills of sale, credit sale and conditional sale and the law of distress in relation thereto. He must also leave a copy of this notice with the consumer. In a hirepurchase agreement, the hirer has the right to terminate the agreement for hire at his pleasure and is not bound to pay the value of the goods. Hire purchase is a kind of agreement where the buyer buying an expensive asset chooses an option to pay for the asset by paying some down payment at the time of purchase of an asset and clearing the remaining dues in regular installments including interest. Presently hps in kenya are governed by the hire purchase act cap 507, which is mainly modeled on the english hire purchase law. Each hire purchase agreement is a separate agreement between you and us. Features of a hire purchase agreement the jet lawyer.
The hire purchase act is like a referee who ensuresthat both sides obey the rules in this case, the seller and the buyer or consumer. Hire purchase in commercial law is an agreement where the owner can permit a person, or the hirer, to hire goods from him or her for a certain period of time. Moreover, in section 12 of the hirepurchase act 1967 revised 1978 states, this act shall apply throughout malaysia and in respect only of hirepurchase agreements. Principles of business law contents study unit title page syllabus i 1 nature and sources of law 1 nature of law 3 historical origins 6 sources of law 9 the european community and uk law. The hire purchase has a right to terminate the agreement at any time in the capacity of a hirer. The nature of hirepurchase transactions and their benefits to the parties in particular and the economy in general were highlighted. Hire purchase agreement meaning, types calculation.
The term hire purchase originated in the united kingdom and is similar to renttoown. The law relating to the purchase in kenya is contained in the hire purchase act 1. It includes cash price and interest on future instalments. A hire purchase is a method of buying goods through making installment payments over time. Hirepurchase act an act to amend the law relating to hire purchase, bills of sale, credit sale and conditional sale and the law of distress in relation thereto.
Hire purchase a hire purchase contract is a contract by which goods are delivered to a person who agrees to make periodical payments by way of hire, with an option of buying the goods after the stated hire installments have been paid. Assets are defined as anything of monetary value that is owned by a firm or an individual. Pdf the impact of hire purchase act 1965 on consumer credit. Until the option is exercised, there is no agreement to buy the goods. Right of hirer to terminate hirepurchase agreement. The law says that the sellers bailiff who is recovering possession of goods must bring with him a copy of the notice of repossession. Damages for breach of a hirepurchase contract although the judgment of the court of appeal in yeoman credit ltd. Avoidance of certain provisions in a hire purchase agreement. Hirepurchase act an act to make provision for the regulation of hirepurchase agreements and certain instalment sales, and for other purposes incidental to the foregoing. Hire purchase 9 a contract of guarantee relating to the agreement shall be enforceable against the purchaser or the guarantor, as the case may be, by the holder of that security. The defendant entered into a hirepurchase agreement with the plaintiffs in january 1959 for the hire of a van. The hirer has an option to buy the goods at the end of the agreement if all installments are being paid. A bailment has been defined by the blacks law dictionary 9 th edition as. Hire purchase and leasing types of finance business.
Hire purchase agreement format download free legal document. An overview 2 common law, equity and statute law 23 custom 25 case law 26 nature of equity 32 application of principles of equity 34. May 27, 2016 in nigeria, the common law rules in relation to hire purchase were in operation. But if the third party obtains not a good title to the goods, the owner may repossess the goods. An act to amend the law relating to hire purchase, bills of sale, credit sale and conditional sale and the law of distress in relation thereto. The hire purchase law is an agreement where an owner of goods agrees to hire out his or her goods to a hirer with the option that the hirer will be able to purchase the goods at the end of the agreement. These rules evidently worked a lot of hardships on parties, especially the hirer of goods. Only when the hirer pays the final instalment, does ownership transfer from the owner to the hirer. Hirepurchase agreement agreements law library advocatekhoj. Hire purchase is governed by hire purchase act in 1972.
Is basically an agreement wherein an owner agrees to hire goods to the hirer with an option for the hirer to purchase the goods. Generally, a certain sum of money is paid at the time of taking delivery known as down payment or initial payment and the installment is paid at the end of the period, say, yearly, halfyearly or quarterly. Act 3 hire purchase act 2009 1 uganda legal information institute. This hirepurchase agreements which relating to other goods are governed by common law. An act to amend the law with respect to the hire purchase and sale upon credit of goods. A hirepurchase agreement is an agreement whereby the owner of a chattel lets it on hire to a hirer for a fixed period and agrees that upon the happening of a stated event usually, but not necessarily, the exercise by the hirer of an option to purchase property in the chattel will pass to the hirer. By virtue of that provision, a copy of the note or memorandum should be delivered or sent to the hirer within 14 days of the making of the agreement. In the latter case that is if the option to purchase is exercised before the expiration of the period of this agreement, the hirer shall be liable to pay a sum equal to the said hirepurchase price or the balance thereof payable by monthly installments of hire charges up to the date of the stipulated period of the agreement as reduced by a. The act was enacted in 1968 and came into force on 2 nd november, 1970.
Hirepurchase 9 a contract of guarantee relating to the agreement shall be enforceable against the purchaser or the guarantor, as the case may be, by the holder of that security. Law and the hirepurchase regulations, 1968 offer only partial protec tion for the hirer, who may be, had al most finished paying t he hirepurchase price, bu t was left with one or two. Pdf hire purchase had been known in this country nigeria for several years but until recently it was confined almost exclusively to. The learned steve shim j in that case stated that at common law, hire purchase agreement is regarded as a form of contract whereby the owner lets goods out on hire and agrees that the hirer may either return the goods and terminate the contract or elect to buy the goods on the completion of the required periodic payments. Hirepurchase act ministry of justice government of jamaica. Law of hirepurchase consumer credit a contract with a minor. Moreover, in section 12 of the hire purchase act 1967 revised 1978 states, this act shall apply throughout malaysia and in respect only of hire purchase agreements relating to the goods specified in the first schedule. This hire purchase agreements which relating to other goods are governed by common law. In the latter case that is if the option to purchase is exercised before the expiration of the period of this agreement, the hirer shall be liable to pay a sum equal to the said hire purchase price or the balance thereof payable by monthly installments of hire charges up to the date of the stipulated period of the agreement as reduced by a. Hire purchase chapter 10 hire purchase law objective to.