hire purchase
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Hire-Purchase Act 1967 (inclusive of Act A1384)
Contents Imortance of Hire-Purchase Act 1967 (HPA)
!e"nition of h a#reement $coe of %#oo&s'
ormation of h a#reement $tatutor ri#hts of hirer
*oi& rovisions
Imortance of Hire-Purchase Act 1967 • Prior to 11 Aril 1968+
$u,ect to the la. of contract / $ale of 0oo&s r&inance 1927 as %a#reement to sell' • acuna+ refer to HP concet at common la.+ la.+ follo. terms of the a#reement • Pro,lems+ Pro,lems+ lac5 in consumer s' rotection •
• HP HPA A 1967+ rotect consumers' interests
,etter than common la. version
!e"nition of HP A#reement • C+ An a#reement .herein the o.ner a#rees to hire #oo&s to the hirer .ith an otion for the hirer to urchase the #oo&s
$ (1) of HPA+ i- ettin# of #oo&s .ith an otion to urchase ii- An a#reement for the urchase of #oo&s , instalments But not+ - Cre&it sale or -ransaction amon# &ealers of same #oo&s
Cases Cre&it Cor () :h& v he 'sian In&ustrial inance Cor / Anor ;1976<
Property in the goods only passes to the hirer upon payment of total amount agreed. ractors 'sia :h& v =um Pem,inaan 'sia $&n :h& ;1979<
Court looks upon the intention of the parties
$coe of %0oo&s' iste& in irst $che&ule of the HPA All consumer #oo&s (urchase& for ersonal> famil / househol& uroses) otor vehicles
What happen if goods not covered under the First Sch?: : inance :erha& v o. Pin# in# A o. Pen# ?nt ;@@2< 3 @8+ B%?ven thou#h the a#reement &oes not fall .ithin the am,it of the Act (not .ithin the 1st $ch) / is also not a ,ill of sale> it is a vali& h a#reement un&er the common la. he reossession of the vehicle (,ull&oer) .as &one , the A in accor&ance .ith the terms of the a#reement / is la.ful'
FIRST SCHEDULE: [Section 1] -List of goods
LIST OF GOODS 1 All consumer #oo&sE ! otor vehicles> namelF (a) Invali& carria#esE () otor CclesE (c) otor Cars inclu&in# taGi ca,s an& hire carsE (d) 0oo&s *ehicles (.here the maGimum ermissi,le la&en .ei#ht &oes not eGcee& 24@ 5ilo#rams)E (e) :uses> inclu&in# sta#e ,uses
ot HP A#reement+ ease+ Has similarit ,ut &iers as h is for consumer #oo&s an& motor vehicle ease is for other than that urose
!agartanam a"l #alara$u v %reka Construction #hd &'* + ,- /: the lease a'm / h a'm .as null / voi&
oan+ 0ra1,alaysian Finance #hd v #orneo Wood
(Saah) Sdn #hd 2 3rs &'* 4 ,- 5+: loan transaction &is#uise& as a HP transaction iste& 3 #oo&s cumulativel instea& of item , item / &eliver an& installation of machineries .as comlete& ,efore si#nin# the alle#e& HP a#reement
ormation of HP A#reement
hree sta#es+ 1 Pre-contractual $ta#e ?nterin# into HP a#reement $ta#e 3 Post-contractual $ta#e
otes+ -ailure to coml the roce&ures un&er (1) / ()+ *oi& a#reement -ailure to coml roce&ure (3)+ an erson shall ,e #uilt of an oence un&er this Act
1- "#e-cont#$ctu$% St$ge e#otiation sta#e+ e#al o,li#ations on o.ner> &ealer or &ealer's a#ent $ 4(1) (a) Jritten statement &ul comlete& / si#ne& , .oul& ,e o.ner a#ent as in Part I of the $econ& $che&ule serve& to rosective hirers &s. +(6) (): if y dealer 7 Part % 8 9ritten duly completed 2 signed y dealer 2 also as Part %% 8 9ritten duly completed 2 signed y dealer 2 prospective o9ner) Propective"intending hirer"agent shall ackno9ledge receipt of the 9ritten statement. &O o'%ig$tion to ente# into () $g#ee*ent + &O )$,*ent o# conside#$tion imose& for rearation service of the statements 0;n Credit v no of instalments> amounts of each instalments / erson to .hom / lace to a> time for ament> suLcient &escrition of #oo&s / a&&ress of #oo&s $ 4!+ searate h a#reement for ever item urchase&
$ 4?+ motor vehicle+ hirer ma ma5e a reMuest in .ritin# to an o.ner to 5ee the re#istration certi"cate (inclu&es re#istration ,oo5) of the motor vehicle> uon .hich o.ner must furnish(If not> o.ner shall ,e #uilt of an oence un&er this Act)
! Ente#ing into H" .g#ee*ent St$ge $ 4 (1) A hire-urchase a#reement shall not ,e entere& into .here
the motor vehicle has ,een altere& or mo&i"e& in its construction an& structure $4() A hire-urchase a#reement that contravenes su,section (1) shall ,e voi& $ 40 (1) or a secon&-han& motor vehicle> the erson .ho inten&s to enter into the h a#reement shall &eclare in .ritin# an &efects in accor&ance .ith the insection reort , the relevant authorit &etermine& , the Controller N&efectO inclu&es &efect to the mechanical or oerational sstem> construction> structure an& ,uil&-u an& "ttin# of the motor vehicle s40(3) An erson .ho contravenes this section shall ,e #uilt of an oence un&er this Act
/ "ost-cont#$ctu$% St$ge
$ 2(1)+ o.ner must serve the hirer / #uarantors (if an) a co of h a#reement .ithin 1 &as after it is ma&e
() At an time ,efore the "nal ament has ,een ma&e un&er a h a#reement the o.ner shall> .ithin 1 &as after he has receive& a reMuest in .ritin# from the hirer> sul to the hirer a co of an memoran&um or note of the a#reement+
(a) on ament , the hirer of the rescri,e& feeE or () .here no fee is rescri,e&> one free co> an& thereafter a fee as ma ,e rescri,e& shall ,e char#e& for the sul of a secon& or su,seMuent co thereof
$2(3)+ o.ner must serve the hirer a co of the olic or statement in .ritin# settin# out the terms> con&itions an& eGclusions of the olic that aect the ri#hts of the hirer> .ithin 7 &as of receit of the olic> if .ith insurance covera#e
$tatutor Ki#hts of Hirer 1 s 9+ Co of statement on his "nancial 3 4 2 6 7 8
osition $1@+ Aroriation $11+ Alin# or&er for removin# #oo&s $1+ Assi#nment $13+ eration of la. uon &eath ,an5rutc $14+ ?arl comletion $12+ ermination $ 16+ Keossession , o.ner
$9+ At an time ,efore the "nal ament has ,een ma&e un&er a HP a#reement the o.ner shall> .ithin fourteen &as after he has receive& a reMuest in .ritin# from the hirer> sul to the hirer a statement si#ne& , the sai& erson or his a#ent sho.in#F
(a) the amount ai& to the o.ner , or on ,ehalf of the hirerE () the amount .hich has ,ecome &ue un&er the a#reement ,ut remains unai&E (c) the amount .hich is to ,ecome aa,le un&er the a#reementE an& (d) the amount &erive& from interest on over&ue instalments+ .ner need not co*)%, .ith such a reMuest if he has sent the hirer a statement .ithin a erio& of 3 months imme&iatel rece&in# the receit of the reMuest
$9() In the event of a failure .ithout reasona,le cause to coml .ith su,section (1) then> .hile the &efault continuesF (a) the o.ner shall not ,e entitle& to enforceF (i) the a#reement a#ainst the hirerE (ii) an ri#ht to recover the #oo&s from the hirerE (iii) an contract of #uarantee relatin# to the a#reementE () an securit #iven , the hirer in resect of mone aa,le un&er the a#reement or #iven , a #uarantor in resect of mone aa,le un&er such a contract of #uarantee as aforesai& shall not ,e enforcea,le a#ainst the hirer or the #uarantor , an hol&er thereof (3) If the &efault aforesai& continues for a erio& of one month> the o.ner shall ,e #uilt of an oence an& shall> on conviction> ,e lia,le to a "ne not eGcee&in# one thousan& rin##it
s1@+ A hirer .ho is lia,le to ma5e aments in resect of t.o or more hire-urchase a#reements to the same o.ner shall> not.ithstan&in# an a#reement to the contrar> ,e entitle&> on ma5in# an ament in resect of the a#reements .hich is not suLcient to &ischar#e the total amount then &ue un&er all the a#reements> to reMuire the o.ner to aroriate the sum so ai& , him in or to.ar&s the satisfaction of the sum &ue un&er an one of the a#reements> or in or to.ar&s the satisfaction of the sums &ue un&er an t.o or more of the a#reements in such roortions as he thin5s "t> an&> if he fails to ma5e an such aroriation as aforesai&> the ament shall , virtue of this section ,e aroriate& to.ar&s the satisfaction of the sums &ue un&er the resective hireurchase a#reements in the or&er in .hich the a#reements .ere entere& into
s11+Jhere> , virtue of a hire-urchase a#reement> it is the &ut of a hirer to 5ee the #oo&s comrise& in the a#reement in his ossession or control at a articular lace or not to remove the #oo&s from a articular lace> a court of a a#istrate ma> on the alication of the hirer> ma5e an or&er arovin# the removal of the #oo&s to some other lace> .hich lace shall> for the uroses of the a#reement> ,e su,stitute& for the lace mentione& in the a#reement
s1(1) he ri#ht> title an& interest of a hirer un&er a hire-urchase a#reement ma ,e assi#ne& .ith the consent of the o.ner> or if his consent is unreasona,l .ithhel&> .ithout his consent ()no ament or other consi&eration shall ,e reMuire& , an o.ner for his consent to such an assi#nment (3) the hirer ma al to the Hi#h Court for an or&er &eclarin# that the consent of the o.ner to that assi#nment has unreasona,l ,een .ithhel& (4) As a con&ition of #rantin# consent> the o.ner ma stiulate that all &efaults un&er the a#reement shall ,e ma&e #oo& / reMuire hirer an& assi#nee to eGecute / &eliver a form / a reasona,le costs incurre& , o.ner on stamin# / re#isterin# assi#nment
s 13+ he ri#ht> title an& interest of a hirer un&er a hire-urchase a#reement shall ,e caa,le of assin# , oeration of la. to the ersonal reresentative of the hirer an& if the hirer is a coman the liMui&ator ma eGercise the same ri#ht un&er the a#reement as the coman ,ut nothin# in this section shall relieve an ersonal reresentative or liMui&ator from comliance .ith the rovisions of the a#reement
s 14 (1) he hirer un&er a hire-urchase a#reement ma> if he has #iven notice in .ritin# to the o.ner of his intention to &o so> on or ,efore the &a seci"e& for that urose in the notice> comlete the urchase of the #oo&s , ain# or ten&erin# to the o.ner the net ,alance &ue un&er the a#reement (3) he ri#hts conferre& on the hirer , this section ma ,e eGercise& , himF (a) at an time &urin# the continuance of the a#reementE or
() .here the o.ner has ta5en ossession of the #oo&s> uon ament to the o.ner (.ithin t.ent-one &as after the o.ner has serve& a notice in the form set out in the ifth $che&ule) in a&&ition to the net ,alance &ue to#ether .ith the reasona,le costs inclu&in# costs (if an) of stora#e> reair or maintenance of the #oo&s incurre& , the o.ner inci&ental to his ta5in# ossession of the #oo&sE or (c) .here the hirer has returne& the #oo&s to the o.ner .ithin t.ent-one &as after the service on him of the notice in the form set out in the ourth $che&ule> uon ament to the o.ner (.ithin t.ent-one &as after the o.ner has serve& a notice in the form set out in the ifth $che&ule) the net ,alance &ue un&er the Act
$12(1) he hirer ma terminate the a#reement , returnin# the #oo&s to the o.ner &urin# or&inar ,usiness hours at the lace at .hich the o.ner or&inaril carries on ,usiness or to the lace seci"e& for that urose in the a#reement () If it .oul& ,e imractica,le to return the #oo&s to such a lace> the hirer ma terminate the a#reement , returnin# the #oo&s to an lace a#ree& to , the arties to the a#reement (3) If fails to a#ree> hirer ma al to a#istrate Court to "G the lace
Keossession+ s16 (1) Keossession coul& onl eGercise& , o.ner if+ i) the ament of instalments amounts to not more than
sevent-"ve ercent of the total cash rice of the #oo&s comrise& in the hire-urchase a#reementE an& ii)there ha& ,een t.o successive &efaults of ament ,
the hirer (&ecease&+ 4 successive &efaults (1C))E an& iii).ner has serve& on the hirer a notice> in .ritin#> in
the form set out in the ourth $che&ule an& the erio& "Ge& , the notice has eGire&> .hich shall not ,e less than t.ent-one &as after the service of the notice (1A) if more+ o.ner can still o,tain or&er from court
() An o.ner nee& not coml .ith su,section (1) if there are reasona,le #roun&s for ,elievin# that the #oo&s comrise& in the hire-urchase a#reement .ill ,e remove& or conceale& , the hirer contrar to the rovisions of the a#reement> ,ut the onus of rovin# the eGistence of those #roun&s lies uon the o.ner
(3) Jithin t.ent-one &as after the o.ner has ta5en ossession of #oo&s that .ere comrise& in a hire-urchase a#reement he shall serve on the hirer an& ever #uarantor of the hirer a notice> in .ritin#> in the form set out in the ifth $che&ule
4) Jhere the o.ner ta5es ossession of #oo&s that .ere comrise& in a hire-urchase a#reement he shall &eliver or cause to ,e &elivere& to the hirer ersonall a &ocument ac5no.le&#in# receit of the #oo&s or> if the hirer is not resent at that time> sen& to the hirer imme&iatel after ta5in# ossession of the #oo&s a &ocument ac5no.le&#in# receit of the #oo&s (2) he &ocument ac5no.le&#in# receit of the #oo&s> reMuire& un&er su,section (4) shall set out a short &escrition of the #oo&s an& the &ate on .hich> the time at .hich an& the lace .here the o.ner too5 ossession of the #oo&s
(6) If the notice reMuire& , su,section (3) is not serve&> the ri#hts of the o.ner un&er the hireurchase a#reement thereuon cease an& &etermineE ,ut if the hirer eGercises his ri#hts un&er this Act to recover the #oo&s so ta5en ossession of> the a#reement has the same force an& eect in relation to the ri#hts an& lia,ilities of the o.ner an& the hirer as it .oul& have ha& if the notice ha& ,een &ul #iven
(7) :efore an& .hen eGercisin# the o.er of ta5in# ossession the o.ner or his servant or a#ent shall> in a&&ition to the rovisions of this Act> coml .ith an re#ulations relatin# to the manner of ta5in# ossession as ma ,e rescri,e&
A hirer .ho returns #oo&s comrise& in a hireurchase a#reement .ithin t.ent-one &as after the service on him of the notice in the form set out in the ourth $che&ule shall not ,e lia,le to aF (a) the cost of reossessionE () the cost inci&ental to ta5in# ossessionE an& (c) the cost of stora#e
Section 10 One# to #et$in )ossession of goods #e)ossessed fo# tent,-one d$,s (1) Jhere an o.ner has ta5en ossession of an #oo&s un&er section 16 he shall not> .ithout the .ritten consent of the hirer> sell or &isose of the #oo&s or art .ith ossession thereof until after the eGiration of t.ent-one &as after the &ate of the service on the hirer of the notice referre& to in su,section 16(3) or> if notice un&er ara#rah 18(1) (a) has ,een #iven> until the time for ament or ten&er ursuant to that notice has eGire& (.hichever is the later) () An o.ner .ho sells or &isoses of an #oo&s or arts .ith ossession of an #oo&s in contravention of su,section (1) shall ,e #uilt of an oence un&er this Act
Section 10. "e#*its fo# #e)ossession (1) o erson shall un&erta5e reossession of #oo&s comrise& in a hire-urchase a#reement .ithout a .ritten ermit issue& , the Controller () An erson .ho contravenes su,section (1) shall ,e #uilt of an oence un&er this Act on-ermit hol&er commits an oence+ s17:
Section 12 Hi#e#3s #ig(ts $nd i**unities (en goods #e)ossessed (1) Jhere the o.ner ta5es ossession of an #oo&s un&er section 16F (a) the hirer ma .ithin t.ent-one &as after the service on him of the notice referre& to in su,section 16(3) , #ivin# to the o.ner a notice in .ritin# si#ne& , the hirer or his a#entF (i) reMuire the o.ner to re-&eliver to or to the or&er of the hirer (su,ect to the comliance , the hirer .ith the rovisions of section 19) the #oo&s that have ,een reossesse&E or (ii) reMuire the o.ner to sell the #oo&s to an erson intro&uce& , the hirer .ho is reare& to ,u the #oo&s for cash at a rice not less than the estimate& value of the #oo&s set out in the "rst mentione& noticeE
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