Retention of title in construction - Revision history

Designing Buildings at 08:54, 30 September 2020

2020-09-30T08:54:07Z

← Older revision		Revision as of 08:54, 30 September 2020
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	* BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].		* BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].

−	[[Category:Contracts_/_payment]] [[Category:Procurement]]	+	[[Category:DCN_Case_Law]] [[Category:DCN_Definition]] [[Category:DCN_Guidance]] [[Category:Contracts_/_payment]] [[Category:Procurement]]

Designing Buildings at 09:37, 27 August 2018

2018-08-27T09:37:14Z

← Older revision		Revision as of 09:37, 27 August 2018
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	* Off site goods and materials.		* Off site goods and materials.
	* Off-site goods and materials - legal issues.		* Off-site goods and materials - legal issues.
		+	* Owner.
	* Parent company guarantee.		* Parent company guarantee.
	* Retention.		* Retention.

Editor at 11:30, 20 September 2017

2017-09-20T11:30:01Z

← Older revision		Revision as of 11:30, 20 September 2017
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		+	Typically on construction projects, goods, materials or plant are not paid for until after they have been delivered to site. Even then, the contractual chain may mean that the client pays the main contractor at agreed intervals, and then the main contractor pays sub-contractors and so on.

−	Typically on construction projects, goods, materials or plant are not paid for until after they have been delivered to site. Even then, the contractual chain may mean that the client pays the main contractor at agreed intervals, and then the main contractor pays sub-contractors and so on. This can put the supplier at risk, if the buyer (typically the contractor) defaults or becomes insolvent before payment is received. If the contractor has delivered the items and the client has received them in good faith then ownership may be disputed even if the supplier has not been paid in full.	+	This can put the supplier at risk, if the buyer (typically the contractor) defaults or becomes insolvent before payment is received. If the contractor has delivered the items and the client has received them in good faith then ownership may be disputed even if the supplier has not been paid in full.

	A ‘retention of title’ clause (‘RoT, ‘Romalpa clause’ or ‘reservation of title clause’) allows a supplier to retain ownership of until specified conditions have been met, for example, until payment has been made. This is permitted under the Sale of Goods Act or the Supply of Goods and Services Act which provide that title passes from the seller to the buyer when the parties intend it to, which can be, for example; upon delivery, upon payment or upon use. This can override the general principle that title passes on delivery and can give an unpaid supplier’s title priority over the client’s.		A ‘retention of title’ clause (‘RoT, ‘Romalpa clause’ or ‘reservation of title clause’) allows a supplier to retain ownership of until specified conditions have been met, for example, until payment has been made. This is permitted under the Sale of Goods Act or the Supply of Goods and Services Act which provide that title passes from the seller to the buyer when the parties intend it to, which can be, for example; upon delivery, upon payment or upon use. This can override the general principle that title passes on delivery and can give an unpaid supplier’s title priority over the client’s.
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	Other measures a supplier might take to reduce their risk include:		Other measures a supplier might take to reduce their risk include:
−	*Checking the financial status of the contractor to assess the likelihood of insolvency before accepting an order.	+
−	*Arranging for items to be marked and stored separately to make clear title remains with the supplier.	+	* Checking the financial status of the contractor to assess the likelihood of insolvency before accepting an order.
−	*Entering into a direct contract with the client.	+	* Arranging for items to be marked and stored separately to make clear title remains with the supplier.
−	*Seeking advance payment.	+	* Entering into a direct contract with the client.
		+	* Seeking advance payment.

	Advance payment can be secured with an advance payment bond and the client’s title established with a vesting certificate, although vesting certificates can be similarly difficult to enforce.		Advance payment can be secured with an advance payment bond and the client’s title established with a vesting certificate, although vesting certificates can be similarly difficult to enforce.

−	NB ~~the~~ term ‘Romalpa clause’ refers to the case of Aluminium Industrie Vaassen BV v Romalpa Aluminium (1976) which established the principle of extended reservation of title.	+	NB: The term ‘Romalpa clause’ refers to the case of Aluminium Industrie Vaassen BV v Romalpa Aluminium (1976) which established the principle of extended reservation of title.

	= Find out more =		= Find out more =

	=== Related articles on Designing Buildings Wiki ===		=== Related articles on Designing Buildings Wiki ===
−	*Advance payment bond.	+
−	*Materials on site.	+	* Advance payment bond.
−	*Off site goods and materials.	+	* Materials on site.
−	*Parent company guarantee.	+	* Off site goods and materials.
−	*Retention.	+	* Off-site goods and materials - legal issues.
−	*Vesting certificate.	+	* Parent company guarantee.
		+	* Retention.
		+	* Vesting certificate.

	=== External references ===		=== External references ===
−	*BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].

−	[[Category:Contracts_/_payment]]	+	* BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].
−	[[Category:Procurement]]	+
		+	[[Category:Contracts_/_payment]] [[Category:Procurement]]

Designing Buildings at 09:56, 9 April 2015

2015-04-09T09:56:44Z

← Older revision		Revision as of 09:56, 9 April 2015
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	=== Related articles on Designing Buildings Wiki ===		=== Related articles on Designing Buildings Wiki ===
	*Advance payment bond.		*Advance payment bond.
−	*Off site goods and materials.	+	*Materials on site.
		+	*Off site goods and materials.
	*Parent company guarantee.		*Parent company guarantee.
	*Retention.		*Retention.

Designing Buildings at 16:06, 8 April 2015

2015-04-08T16:06:24Z

← Older revision		Revision as of 16:06, 8 April 2015
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	=== Related articles on Designing Buildings Wiki ===		=== Related articles on Designing Buildings Wiki ===
−	*Off site goods and materials.
	*Advance payment bond.		*Advance payment bond.
		+	*Off site goods and materials.
		+	*Parent company guarantee.
		+	*Retention.
	*Vesting certificate.		*Vesting certificate.

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	*BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].		*BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].

−	~~[[Category:Contracts_/_payment]]~~
	[[Category:Contracts_/_payment]]		[[Category:Contracts_/_payment]]
	[[Category:Procurement]]		[[Category:Procurement]]

Designing Buildings: moved Retention of title to Retention of title in construction

2014-10-04T06:52:48Z

moved Retention of title to Retention of title in construction

← Older revision

Revision as of 06:52, 4 October 2014

Designing Buildings at 09:41, 28 April 2014

2014-04-28T09:41:23Z

← Older revision		Revision as of 09:41, 28 April 2014
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	A ‘retention of title’ clause (‘RoT, ‘Romalpa clause’ or ‘reservation of title clause’) allows a supplier to retain ownership of until specified conditions have been met, for example, until payment has been made. This is permitted under the Sale of Goods Act or the Supply of Goods and Services Act which provide that title passes from the seller to the buyer when the parties intend it to, which can be, for example; upon delivery, upon payment or upon use. This can override the general principle that title passes on delivery and can give an unpaid supplier’s title priority over the client’s.		A ‘retention of title’ clause (‘RoT, ‘Romalpa clause’ or ‘reservation of title clause’) allows a supplier to retain ownership of until specified conditions have been met, for example, until payment has been made. This is permitted under the Sale of Goods Act or the Supply of Goods and Services Act which provide that title passes from the seller to the buyer when the parties intend it to, which can be, for example; upon delivery, upon payment or upon use. This can override the general principle that title passes on delivery and can give an unpaid supplier’s title priority over the client’s.

−	Such clauses need to be clearly worded, it must be established that they prevail over other documentation (such as purchase orders), and they must be drawn to the attention of contractor and client by the supplier. If the contractor becomes insolvent, or seems likely to become insolvent, the supplier should act quickly to establish their case, giving notice of retention of title, and making clear that payment has not been made.	+	Such clauses need to be clearly worded, it must be established that they prevail over other documentation (such as purchase orders), and they must be drawn to the attention of the contractor and client by the supplier. If the contractor becomes insolvent, or seems likely to become insolvent, the supplier should act quickly to establish their case, giving notice of retention of title, and making clear that payment has not been made.

−	However, even when properly prepared, retention of tile clauses can be difficult to enforce, as, generally, title passes to the client once items are incorporated into the development anyway, irrespective of whether payment has been made, and it can be difficult to establish whether payment has been made as the client may ~~simply~~ make stage payments rather than paying in total for specific items.	+	However, even when properly prepared, retention of tile clauses can be difficult to enforce, as generally, title passes to the client once items are incorporated into the development anyway, irrespective of whether payment has been made, and it can be difficult to establish whether payment has been made, as the client may make stage payments rather than paying in total for specific items.

−	Other measures ~~that the~~ supplier might take to reduce their risk include:	+	Other measures a supplier might take to reduce their risk include:
	*Checking the financial status of the contractor to assess the likelihood of insolvency before accepting an order.		*Checking the financial status of the contractor to assess the likelihood of insolvency before accepting an order.
−	*Arranging for items to be marked and stored separately to make clear ~~that the~~ title remains with the supplier.	+	*Arranging for items to be marked and stored separately to make clear title remains with the supplier.
	*Entering into a direct contract with the client.		*Entering into a direct contract with the client.
	*Seeking advance payment.		*Seeking advance payment.
Line 16:		Line 16:
	Advance payment can be secured with an advance payment bond and the client’s title established with a vesting certificate, although vesting certificates can be similarly difficult to enforce.		Advance payment can be secured with an advance payment bond and the client’s title established with a vesting certificate, although vesting certificates can be similarly difficult to enforce.

−	NB the term ‘Romalpa clause’ refers to the case of Aluminium Industrie Vaassen ~~B.V.~~ v Romalpa Aluminium (1976) which established the principle of extended reservation of title.	+	NB the term ‘Romalpa clause’ refers to the case of Aluminium Industrie Vaassen BV v Romalpa Aluminium (1976) which established the principle of extended reservation of title.

	= Find out more =		= Find out more =

−	Related articles on Designing Buildings Wiki	+	=== Related articles on Designing Buildings Wiki ===
	*Off site goods and materials.		*Off site goods and materials.
	*Advance payment bond.		*Advance payment bond.
	*Vesting certificate.		*Vesting certificate.

−	External references	+	=== External references ===
	*BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].		*BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].

Designing Buildings at 09:35, 28 April 2014

2014-04-28T09:35:58Z

← Older revision		Revision as of 09:35, 28 April 2014
Line 1:		Line 1:

−	Typically on construction projects, goods, materials or plant are not paid for until after they have been delivered to site. Even then, the contractual chain may mean that the client pays the main contractor, and then the main contractor pays sub-contractors and so on. This can put the supplier at risk, if the buyer (typically the contractor) defaults or becomes insolvent before payment is received. If the contractor has delivered the items and the client has received them in good faith then ownership may be disputed.	+	Typically on construction projects, goods, materials or plant are not paid for until after they have been delivered to site. Even then, the contractual chain may mean that the client pays the main contractor at agreed intervals, and then the main contractor pays sub-contractors and so on. This can put the supplier at risk, if the buyer (typically the contractor) defaults or becomes insolvent before payment is received. If the contractor has delivered the items and the client has received them in good faith then ownership may be disputed even if the supplier has not been paid in full.

−	A ‘retention of title’ clause (‘RoT, ‘Romalpa clause’ or ‘reservation of title clause’) allows a supplier to retain ownership of ~~unfixed items~~ until specified conditions have been met, for example, until payment has been made. This is permitted under the Sale of Goods Act or the Supply of Goods and Services Act which provide that title passes from the seller to the buyer when the parties intend it to, which can be, for example; upon delivery, upon payment or upon use. This can override the general principle that title passes on delivery and ~~gives~~ an unpaid supplier’s title priority over the client’s.	+	A ‘retention of title’ clause (‘RoT, ‘Romalpa clause’ or ‘reservation of title clause’) allows a supplier to retain ownership of until specified conditions have been met, for example, until payment has been made. This is permitted under the Sale of Goods Act or the Supply of Goods and Services Act which provide that title passes from the seller to the buyer when the parties intend it to, which can be, for example; upon delivery, upon payment or upon use. This can override the general principle that title passes on delivery and can give an unpaid supplier’s title priority over the client’s.

−	Such clauses need to be clearly worded, it must be established that they prevail over other documentation, such as purchase orders, and they must be drawn to the attention of contractor and client by the supplier. If the contractor becomes insolvent, or seems likely to become insolvent, the supplier should act quickly to establish their case, giving notice of retention of title, and making clear that payment has not been made.	+	Such clauses need to be clearly worded, it must be established that they prevail over other documentation (such as purchase orders), and they must be drawn to the attention of contractor and client by the supplier. If the contractor becomes insolvent, or seems likely to become insolvent, the supplier should act quickly to establish their case, giving notice of retention of title, and making clear that payment has not been made.

	However, even when properly prepared, retention of tile clauses can be difficult to enforce, as, generally, title passes to the client once items are incorporated into the development anyway, irrespective of whether payment has been made, and it can be difficult to establish whether payment has been made as the client may simply make stage payments rather than paying in total for specific items.		However, even when properly prepared, retention of tile clauses can be difficult to enforce, as, generally, title passes to the client once items are incorporated into the development anyway, irrespective of whether payment has been made, and it can be difficult to establish whether payment has been made as the client may simply make stage payments rather than paying in total for specific items.

Designing Buildings: Created page with " Typically on construction projects, goods, materials or plant are not paid for until after they have been delivered to site. Even then, the contractual chain may mean that the c..."

2014-04-28T09:29:18Z

Created page with " Typically on construction projects, goods, materials or plant are not paid for until after they have been delivered to site. Even then, the contractual chain may mean that the c..."

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Typically on construction projects, goods, materials or plant are not paid for until after they have been delivered to site. Even then, the contractual chain may mean that the client pays the main contractor, and then the main contractor pays sub-contractors and so on. This can put the supplier at risk, if the buyer (typically the contractor) defaults or becomes insolvent before payment is received. If the contractor has delivered the items and the client has received them in good faith then ownership may be disputed.

A ‘retention of title’ clause (‘RoT, ‘Romalpa clause’ or ‘reservation of title clause’) allows a supplier to retain ownership of unfixed items until specified conditions have been met, for example, until payment has been made. This is permitted under the Sale of Goods Act or the Supply of Goods and Services Act which provide that title passes from the seller to the buyer when the parties intend it to, which can be, for example; upon delivery, upon payment or upon use. This can override the general principle that title passes on delivery and gives an unpaid supplier’s title priority over the client’s.

Such clauses need to be clearly worded, it must be established that they prevail over other documentation, such as purchase orders, and they must be drawn to the attention of contractor and client by the supplier. If the contractor becomes insolvent, or seems likely to become insolvent, the supplier should act quickly to establish their case, giving notice of retention of title, and making clear that payment has not been made.

However, even when properly prepared, retention of tile clauses can be difficult to enforce, as, generally, title passes to the client once items are incorporated into the development anyway, irrespective of whether payment has been made, and it can be difficult to establish whether payment has been made as the client may simply make stage payments rather than paying in total for specific items.

Other measures that the supplier might take to reduce their risk include:
*Checking the financial status of the contractor to assess the likelihood of insolvency before accepting an order.
*Arranging for items to be marked and stored separately to make clear that the title remains with the supplier.
*Entering into a direct contract with the client.
*Seeking advance payment.

Advance payment can be secured with an advance payment bond and the client’s title established with a vesting certificate, although vesting certificates can be similarly difficult to enforce.

NB the term ‘Romalpa clause’ refers to the case of Aluminium Industrie Vaassen B.V. v Romalpa Aluminium (1976) which established the principle of extended reservation of title.

= Find out more =

Related articles on Designing Buildings Wiki
*Off site goods and materials.
*Advance payment bond.
*Vesting certificate.

External references
*BIS, [http://www.insolvencydirect.bis.gov.uk/casehelpmanual/R/RetentionOfTitle.htm Retention of title].

[[Category:Contracts_/_payment]]
[[Category:Contracts_/_payment]]
[[Category:Procurement]]