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Contract terms - is this normal


Nick D

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I have just received the contract from the broker through whom we are buying our boat which says that that they have received a declaration of ownership from the vendor declaring that there are no other interested parties including finance, loans or mortgages secured on the boat but that basically they can't guarantee this.  I imagine there is nothing like an HPI check that can be done on a used car, and that if there is a problem, then I could sue the vendor, but I just wanted to check that this is normal. Thanks 

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7 minutes ago, Nick D said:

I have just received the contract from the broker through whom we are buying our boat which says that that they have received a declaration of ownership from the vendor declaring that there are no other interested parties including finance, loans or mortgages secured on the boat but that basically they can't guarantee this.  I imagine there is nothing like an HPI check that can be done on a used car, and that if there is a problem, then I could sue the vendor, but I just wanted to check that this is normal. Thanks 

Yes that is very normal. There are not the kind of safequards available re boat purchase as with such as property and even cars. This for me is what I like about the boating market it cuts out much of the paperwork crap from my life. I suss out the vendor on a personal basis and have had no problems so far.

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Yes this is normal and there is no central register of boat ownership or finance. But you can ask the owner for evidence of ownership, such as a Bill of Sale when they bought the boat, or details of licence/insurance/moorings correspondence going back some years.

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Thanks, yes, I am meeting the vendor to go through the inventory etc. I don't think proof of ownership is the problem, it's whether or not there is finance on the boat that has not been cleared.

Edited by Nick D
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12 minutes ago, Nick D said:

Thanks, yes, I am meeting the vendor to go through the inventory etc. I don't think proof of ownership is the problem, it's whether or not there is finance on the boat that has not been cleared.

The C&RT 'registration' number is not a register of boat ownership or any registration of finance etc - it is purely an 'administration' aid to allow C&RT to recognise and licence a boat.

 

The only registration system that does what you want is very rarely used by Inland Waterways boaters, but more common by Sea-Going boaters.

The 'UK Ships Register' is run by the Government and provides :

Part I registration

Register your boat on the Part I register if you want to:

  • prove you own the boat
  • prove your boat’s nationality
  • use the boat as security for a marine mortgage
  • register a pleasure vessel
  • get ‘transcripts of registry’, which show the boat’s previous owners and whether there are any outstanding mortgages

Your boat must have a unique name to be registered.

It costs £124 to register for 5 years.

 

It would not be difficult to introduce this (or even the 'lower' part 3 registration) but there appears to be little incentive, or demand for it.

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1 hour ago, Nick D said:

I don't think proof of ownership is the problem, it's whether or not there is finance on the boat that has not been cleared.

If the previous owner had finance it is extremely unlikely that it was in the form of a marine mortgage. It is far more likely to have been a personal loan. Therefore no lein on the boat. 

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15 hours ago, WotEver said:

If the previous owner had finance it is extremely unlikely that it was in the form of a marine mortgage. It is far more likely to have been a personal loan. Therefore no lein on the boat. 

There are not many companies offering marine mortgages now so it wouldn't take long armed with the boat name and hull number to find out if any finances are owing.

A friend of ours had a near miss on this score. The vendor through a private sale claimed there was no finance owing. Suspecting something fishy he rang around and found out that there was indeed still £26k owing in outstanding mortgage payments. The boat was for sale for £34k and they had agreed a sale price of £28k. In the end they agreed that he would pay the finance company off and give the vendor the remaining £2k in cash. Turned out the boat was on the verge of being repossessed.

So buyer beware.

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3 minutes ago, Tony Brooks said:

I would have thought the broker should do the legwork rather than rely upon just a written statement.

The thing is, even in good faith, all he need can say is that "to the best of hs knowledge..... ", its the old "difficult to prove a negative".

There must be a foolproof method, else the marine mortgage companies would end up with multiple mortgages on one vessel, and no chance of re payment.

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23 minutes ago, Tony Brooks said:

But then if he did not make all reasonable checks on the veracity of the vendors statement the question of negligence arises.

But many brokers have a clause on the bottom of the 'details' saying something to the effect of :

"these details are as compete as we can make them and are believed to be accurate at the time produced , but were produced from information given by the owner"

 

Edit to add :

There should be greater protection from any brokers who are members of the BMF - (extracts from the sales contract)

THIS DOCUMENT IS INTENDED TO CREATE A LEGALLY BINDING CONTRACT;

IF YOU ARE UNSURE AS TO THE EFFECT OF ANY OF THE PROVISIONS YOU ARE ADVISED TO TAKE APPROPRIATE PROFESSIONAL ADVICE

    1. The Seller agrees to sell and the Purchaser agrees to purchase the Vessel free from all debts, claims and charges of every kind subject to the terms of this Agreement for the sum of £xx,xxx (pounds sterling xxxxxxxxx) (“the Purchase Price”)  together with all the gear and equipment bought for and belonging to the Vessel as detailed in the attached inventory but excluding provisions and the Seller’s personal effects. 

  1. Warranties

    1. This sale is not related to the Seller’s business, trade or profession.

    2. By the terms of this Agreement the Purchaser is given every proper opportunity to inspect, survey and sea trial the Vessel and all gear and equipment included within the sale and to satisfy himself as to its condition, quality, specification and fitness for purpose; this shall include a right to inspect title and VAT status documents. 

      1. If the Seller is selling the Vessel in a private capacity  and not in the course of, or for the purpose of a business then, subject to these rights of inspection, survey and sea trial and the other terms of this Agreement (in particular Clause 3.3) the Purchaser waives all rights relating to the condition, quality, description and fitness for purpose of the Vessel, its gear and equipment, and the Purchaser agrees to buy the Vessel, its gear and equipment with all defects and faults of description without any allowance whatsoever.

The Seller warrants to the Purchaser that the factual matters set out in the description of the Vessel on page 1 of this Agreement are true and correct and that he is the sole legal and beneficial owner of the Vessel and absolutely entitled to transfer his interest in the Vessel in the manner provided by this Agreement

Edited by Alan de Enfield
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They do but I think that if someone with sufficient funds took they to court that may well be judged an unfair contract term and be struck out.  Not that it helps the OP in any way, more a comment on the ethics of the likes of brokers.

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If a marine mortgage requires small craft registration, then, if there is no registration, ergo [latin 'O' level] , there can be no marine mortgage, but is that the only possible lien on a vessel?, suppose it i part of a business [thinkg w...... et all ?]

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Just now, LadyG said:

If a marine mortgage requires small craft registration, then, if there is no registration, ergo [latin 'O' level] , there can be no marine mortgage, but is that the only possible lien on a vessel?, suppose it i part of a business [thinkg w...... et all ?]

Who has said a mortgage requires Small Craft registration ?

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3 minutes ago, LadyG said:

Sorry, I got that impression, not sure where........

A Part 1 Small Ships Registration will show if a boat has finance on it.

I would have thought (I don't know as I have never had a mortgage or loan) that he CIN or any other non-removable identifier would be sufficient identification.

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7 minutes ago, LadyG said:

CIN?

Craft Identification Number, also HIN = Hull Identification Number.

Now WIN

The WaterCraft Identification Number (WIN, previously CIN and HIN) is a 14-digit code that is marked on the boat in two places, one on the starboard side of the transom and a second hidden within the boat. The CIN is usually moulded or etched into the fabric of the boat hull to ensure permanency.

Details of how to formulate a WIN are available in BS EN ISO 10087:2006.

The WIN consists of a two-letter code to denote country of origin (boats built in the UK use GB), followed by a three-letter code to denote the manufacturer. This code is known as the Manufacturer’s Identity Code (MIC) and is unique to the boatbuilder.

In the UK the register of MIC is maintained by British Marine on behalf of the Department for Business Energy and Industrial Strategy (BEIS). If you are a boatbuilder from a country within the EU then you must register with the organisation within your own country.

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3 minutes ago, Alan de Enfield said:

Craft Identification Number, also HIN = Hull Identification Number.

Now WIN

The WaterCraft Identification Number (WIN, previously CIN and HIN) is a 14-digit code that is marked on the boat in two places, one on the starboard side of the transom and a second hidden within the boat. The CIN is usually moulded or etched into the fabric of the boat hull to ensure permanency.

Details of how to formulate a WIN are available in BS EN ISO 10087:2006.

The WIN consists of a two-letter code to denote country of origin (boats built in the UK use GB), followed by a three-letter code to denote the manufacturer. This code is known as the Manufacturer’s Identity Code (MIC) and is unique to the boatbuilder.

In the UK the register of MIC is maintained by British Marine on behalf of the Department for Business Energy and Industrial Strategy (BEIS). If you are a boatbuilder from a country within the EU then you must register with the organisation within your own country.

Since when?

I mean, I am looking at boats which are not new.

Edited by LadyG
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45 minutes ago, LadyG said:

Since when?

I mean, I am looking at boats which are not new.

All salty boats manufactured or imported on or after November 1, 1972 must bear a HIN/CIN/WIN. Inland boats might well not have unless they've been built to the RCD spec. 

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