There are many issues when people leasing a vehicle add features or equipment to it, or if parts are seemingly financed separately, similar to issues relating to the financing of fixtures on land, where the addition can end up becoming part of what it is attached to, losing its separate identity.
Title is the asset funders security and, in the vast majority of cases, a suppliers invoice is accepted as adequate evidence of the funders title. However, the recent decision of JD Cleverly Limited vs Family Finance Limited (2010) has highlighted the difficulties of simply accepting an invoice without applying some thought to the supply process and vetting invoices before approval of the facility. Sympathies may not always lie with the funder when title is challenged if, to use the words of Lord Justice Tomlinson in JD Cleverly, “laxity in business practices” is the effective cause of a successful challenge.
Recovery of goods can prove tricky once some of the agreed price has been paid, says DWFs David Wood. Section 90 of the Consumer Credit Act is one of the more troublesome of its provisions. It is section 90 that prevents a lender from recovering goods without a court order following termination of a hire purchase or conditional sale agreement, where more than a third of the price has been paid. Ignore this provision at your peril, because if you do, the customer could be released from all further liability and recover all sums paid under the agreement.