HIre Purchase

Hire Purchase

This is a contract of hiring with an option to purchase. The Property in the goods does not pass with  possession and the owner may recover the goods from the purchaser.

Section 4 of the Hire Purchase Act specifies that a hire purchase agreement(HP Agreement ):a) ust ust !e in "ng# "ng#is ish h  !) $egistered within %& days of e'ecution and c) The payment payment of the prescri!ed prescri!ed fees fees that is stamp stamp duty and registra registration tion fees must must !e made The effect of non-registration is that the agreement is rendered unenforcea!#e against the hirer and the security is a#so unenforcea!#e.

Statutory reuirements re#ating to a HP Agreement Agreement (S. *) a) The owner owner must must inform inform the hirer hirer of the the cash cash price. price.  !) Hirer must have inspected the goods to which the #a!e#s stating the cash price are attached or  c) Hirer Hirer has se#ected se#ected the goods goods !y referr referring ing to a cata#o cata#ogue gue or advert advertise isemen mentt or price price #ist which which stated the cash price. d) Specificati Specification on of the amounts amounts and date date of payment payment of each insta# insta##ment #ment e) +otice +otice sett setting ing out out the the hirer, hirer,ss right rights. s. f) escription escription of the the goods that is is suffici sufficient ent to to identify identify them. them.

S. Protection of the Hirer  The fo##owing statements or provisions are void in the ag reement:a) /#auses /#auses a##owing a##owing owner to enter the the premises premises of the hirer for the the purposes purposes of repossessi repossessing ng the goods.  !) /#ause that re#ieves the owner of #ia!i#ity for such entry c) any c#ause c#ause that impose imposess #ia!i#it #ia!i#ity y on the hirer hirer in e'cess e'cess of that imposed imposed !y s. 01 !y reason reason of  termination of the contract !y him d) any c#ause that that ma2es any person person acting acting on !eha#f !eha#f of the owner in connectio connection n of the agreement agreement an agent of the hirer  e) any c#ause that that re#ieves re#ieves the owner of #ia!i#i #ia!i#ity ty for the acts or defau#t defau#t of any person person acting acting on his  !eha#f in connection with the formation of the agreement.

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S. 3 mp#ied /onditions and 5arranties in the HP Agreement. 0. $ight to se## 1. erchanta!i#ity %. 6itness for particu#ar purpose 4. 7ega# ownership 8. 9uiet possession enoyed !y hirer  *. 6ree from charge and encum!rances These conditions and warranties cannot !e e'c#uded from the agreement.

uties of the Hirer  a) Ta2e de#ivery  !) Pay insta##ments c) Ta2e care of the goods d) /ontinue hiring for the agreed period. e) +otification of change of address.

uties of ;wner  a) e#iver the goods to the hirer   !) +otification of defects of tit#e or otherwise c) ndemnity< compensate the hirer of any #oss or #ia!i#ity arising !y reason of any defect in the goods.

S.01 Termination Hirer may terminate !efore fina# payment or when the insta##ment fa##s due !y:a) =iving owner written notice of termination.  !) $eturning the goods to the owner.

Hirer is #ia!#e to pay a## insta##ments due !y that time Pay any sum that wi## !e his fina# payment not #ess than ha#f of the tota# hire-purchase price un#ess a #esser sum is specified in the agreement. Any  provisions in the agreement providing for a #arger payment than one ha#f of the tota# hire-purchase  price sha## !e void. 1

f the hirer has not ta2en reasona!#e care of the goods he sha## !e #ia!#e to pay damages for the fai#ure. Hirer returns the goods at his own e'pense to the premises from which they were supp#ied to him or to wherever he is directed. The ;wner is reuired to reim!urse additiona# une'pected e'penses.

/omp#etion of the Agreement 5ritten +otice !y the hirer either  a) uring continuance of the agreement or   !) 5ithin 13 days after the owner has repossessed and additiona# costs that may have !een incurred such as storage or repair.

S.08 $ecovery of Possession of =oods 5here 1>% of the hire-purchase price is paid the owner os prec#uded from enforcing the rights of  recovery of possession from the hirer otherwise than !y fi#ing a suit un#ess the hirer has defau#ted in  payment or terminated the agreement. n the event the ;wner vio#ates the a!ove provision:a) HP Agreement wou#d come to an end automatica##y  !) Hirer wou#d !e re#eased from any #ia!i#ity under the HP Agreement and wou#d !e entit#ed to recover a## sums paid !y him or any security given !y him. c) The guarantor wou#d !e entit#ed to recover a## sums paid !y him or any security given !y him.

The owner can on#y c#aim or enforce any wrong !y way of a suit. The court may ma2e the fo##owing orders:a) 6or de#ivery of a## goods to owner.  !) 6or de#ivery of part of the goods to the owner and transfer of tit#e to the goods to the hirer for  the remainder of the goods c) 6or de#ivery of part of the goods to the owner and postpone operation of the order or condition that the hirer pays the app#ied !a#ance as the court directs.

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