Question

OBJECTIVE:

The purpose of this assignment is to assess the understanding of the students on the application of the law of hire-purchase to the procedure of repossession. The Hire-purchase Act requires that any repossession of goods by the owner is based on a standard procedure. However, is it possible for such a procedure to be waived by the parties? Students are required to look into the issues, evaluate it and recommend better solutions to the parties.

TASK:

1. Students have to identify the main issues regarding repossession procedure and the waiver of such procedure, identify relevant principles from the Hire-purchase Act 1967 and apply the relevant principles to the issue, supported by examples and cases.  

2. Students are expected to provide their recommendations and conclusion based on the discussion.

Answer 1

Repossession

In a hire purchase agreement the hire purchaser has to pay up to the last instalment to obtain the ownership of goods. If the hire purchaser fails to pay any of the instalments, the hire vendor takes the assent back in its actual form without any refund of the earlier payments to the hire purchaser. The amounts received from the hire purchaser through down payment and instalments are treated as the hire charges by hire vendor .This act of recovery of possession of asset is termed as repossession. There are two type of repossession, that are complete and partial repossession.

Procedures of Repossession

The Hire Purchase Act, 1967 lays down various restrictions on the power of the owner when recovering possession.

1) Notices must be given to the hirer when goods are to be repossessed. Section 17

2) After repossession the owner must not sell or dispose of the goods within 21 days. Section 17

3) Hirer's right and immunities when goods are repossessed. Section 18

4) Hirer can regain possession of the goods in certain circumstances . Section 19

An example of procedures of a lawful car repossession by bank is shown as image below.

Ethics on Repossession

1) No violence or oppressive means used to conduct the job.

2) Hirer must have sufficient notice about the repossession and given time.

3) The person in charge of repossession may only enter the premise with consent of residents.

If the procedures are not followed by parties and if you can't agree a solution directly with your lender,resolve a problem tool to help you for the next steps.This may include going to the Dispute Tribunal or District Court .  

If you think the lender didn't act appropriately during the repossession process, you can make a complaint about them to their Financial Dispute Resolution Scheme.