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Hire and Purchase Agreement
THIS AGREEMENT is made on
Between
(1) whose registered office is at (the Owner) (2) whose registered office is at (the Hirer) in relation to the Goods as described herein:
It is agreed as follows:
The Parties Agree as Follows:
1. General Terms and Definition
1.1. The Goods are hired for the purpose of (the "Purpose").
1.2. The Goods are hired on (the "Hire Date").
1.3. The term for the hiring of the Goods will end of (the "Expiry Date").
1.4. The total sum to rent the Goods during the period is (the "Total Rent").
1.5. The Payment Schedule for each fixed payment of the Total Rent in relation to the Goods is as below:
2. Ownership and Title
2.1. The Owner has title to the Goods and the Owner has agreed to hire the Goods to the Hirer and the
Hirer has agreed to hire the Goods from the Owner as of the Hire Date on these terms. Subject to the Hirer duly and punctually paying the Total Rent and observing and performing its obligations as set out in this Agreement, the Hirer will peaceably possess and enjoy the Goods from the Hire Date to and including the Expiry Date without interruption or disturbance from the Owner or any other person lawfully claiming by or from or under the Owner, subject always to the rights of the Owner.
2.2. The Owner will not assign, transfer, charge or otherwise deal with its title to the Goods without prior written consent of the Hirer and such consent will not unreasonably be withheld.
2.3. The Hirer hereby acknowledges that until such time as the ownership of the Goods vests in the Hirer either pursuant to the proper exercise of the Option to Purchase herein contained or otherwise with the specific written consent of the Owner, the Goods are and shall remain the sole and exclusive property of the Owner. The Hirer shall have possession of the Goods as a mere bailee.
2.4. The Parties agree that the Goods are being hired to the Hirer for the Purpose.
2.5. The hiring of the Goods will be for the period commencing on the Hire Date and ending at close of business on the Expiry Date.
2.6. The Owner appoints the Hirer as its agent in respect of all matters relating to the ordering, delivery and servicing of the Goods including without limitation doing all such acts as may be necessary to keep the warranties of the Goods in full force and effect, subject to the following subclauses:
2.7. Notwithstanding Clause 2.7, the Owner does not assume or acquire any liability for:
a. Any failure or delay in acquisition or delivery of the Goods;
b. Placing and maintaining the Goods in good working order;
c. For delivery of wrong goods;
d. For defects in manufacture or operation of the Goods; or
e. Loss of or damage to the Goods.
And the Hirer will indemnify the Owner against all liabilities that the owner may incur in connection with any action by or omission of the Hirer in the name of or as agent of the Owner.
3. Acceptance and Delivery
3.1. The Hirer will at its own cost obtain delivery of the Goods and will ensure that the Goods are prepared and ready for his own use.
3.2. The Hirer has selected the Goods from the Dealer and has requested the Owner to purchase the same and let the Goods on hire to the Hirer. The Hirer is satisfied that the Goods are suitable in all respects for the purpose(s) for which they are intended and accepts full responsibility for approving the design, specification and description and for acceptance of the Goods. The Owner shall not be liable in any manner for the non-performance or improper performance of any contract for the supply of the Goods or the quality, fitness or safety of the Goods and all matters related thereto. The Hirer shall hold the Owner harmless from any of the above and effectually indemnify the Owner against any loss or damages suffered by the Owner accordingly.
3.3. If after the date of this Agreement, the purchase price of the Goods to be acquired by the Owner shall be increased pursuant to the contract for the supply thereof to the Owner, the Owner may, at its absolute discretion, by notice to the Hirer either require the Hirer to pay immediately, if necessary by payment in cash, the amount of such increase or adjust the amount of the Hire Rent to take account of such increase.
3.4. This Agreement shall be effective and binding notwithstanding the Hirer has not physically examined and/or taken delivery of the Goods provided that the Goods are available to be examined and/or taken delivery on the date specified by the Owner or the Dealer and the Hirer has been informed of such availability of the Goods.
3.5. The Hirer shall be solely responsible to examine and/or take delivery of the Goods at his own costs and expenses. The Hirer’s failure to examine and/or take delivery of the Goods constitutes a default in respect of which the Owner is (without limitation or prejudice to any of its other rights herein) entitled to take action against the Hirer under this Agreement.
3.6. Delivery of the Goods to the Hirer shall be conclusive evidence that the Hirer has examined the same and found the same to be completely satisfactory and in accordance with their description, in good order and condition and for any purpose for which they may be required by the Hirer.
4. Hirer’s Option to Purchase
4.1. Provided that no event of default has occurred and is continuing or has not been waived or remedied, the Hirer may at any time during the term or on the Expiry Date elect to purchase the Goods by paying the Owner the Residual and the balance of Total Rent then outstanding together with all other money then due and payable to the Owner under this Agreement where the hiring has ended.
4.2. The Hirer may at any time accelerate all payments under this Agreement and exercise this Option to Purchase whereby the Owner may at its sole and absolute discretion charge an early termination fee as specified by the Owner from time to time and/or grant a rebate or discount in respect of such accelerated payment.
4.3. This Option to Purchase hereunder automatically lapses upon the termination of this Agreement.
5. Deposit and Other Payments
5.1. Notwithstanding any other provision in this Agreement, if any Payment Date on which any payment under this Agreement is payable shall fall on a day which is not a Business Day, the payment payable on that Payment Date shall be due and payable on the immediately succeeding Business Day; and if that immediately succeeding Business Day shall fall in the next calendar month, then the said payment shall be due and payable on the Business Day immediately preceding that Payment Date; and if in a given calendar month there is no date corresponding to that Payment Date, the Payment shall be paid on the last Business Day of the calendar month in which that Payment Date initially falls. On the Expiry Date, the Hirer will pay the Owner any Residual payment.
5.2. If the total amount of Total Rent payable under this Agreement shall change by virtue of any adjustment to any Payment Date, variation will be correspondingly made to the amount of any Total Rent payable on any Payment Date as the Owner thinks fit at its absolute discretion in order to reflect the abovementioned change in the total amount of Total Rent payable.
5.3. All sums payable to the Owner under this Agreement shall be paid to the Owner in such manner and at such address as the Owner may from time to time specify. Such payments shall only be deemed to have been made when received by the Owner. Payments made by post shall be at the risk of the Hirer.
5.4. The Hirer confirms that it is customary in the hire purchase business for an owner to pay or be paid commission in respect of the supply of goods the subject of a hire purchase agreement or otherwise in respect of a hire purchase agreement and hereby expressly agrees and consents to the Owner making or receiving any such payment, including but not limited to payment to the Hirer’s agents, in respect of the Goods or this Agreement and acknowledges that the amount of any such payment may be reflected in the Total Rent payable under this Agreement and that the Owner has no obligation to account to the Hirer for the amount of any sum so received.
5.5. The Hirer’s obligation to the pay the Total Rent and all other money payable under this Agreement and the Owner’s rights in and to all such payments are absolute and unconditional and are not affected by:
a. Any defect in the Goods;
b. The condition, operation or fitness for use of the Goods;
c. Any loss of or damage to the Goods;
d. Any lien or other encumbrance over or in respect of the Goods;
e. Any defect in the Owner’s title to the Goods;
f. Any interruption of or prohibition or other restriction against the Owner’s possession, use or operation of the Goods for any reason whatsoever;
and it is the intention of the Parties that the Total Rent and other money payable will continue to be payable as provided in this Agreement unless the Agreement is terminated.
5.6 A certificate signed by an authorized person of Owner as to the amount due from the Hirer under this Agreement at the date of such certificate shall be prima facie evidence that the amount so certified was in fact due from the Hirer at the date of such certificate.
5.7 The Total Rent and all other sums payable by the Hirer under this Agreement shall be applied by the Owner in the order to be determined from time to time by the Owner at its absolute discretion.
6. Hirer’s Undertakings
6.1. During the continuance of this Agreement, the Hirer shall in addition and without prejudice to its obligations under the Terms and Conditions:
a. punctually pay all Hire Rents and all other sums due under this Agreement (time being of the essence) notwithstanding that no demand thereof shall have been made by the Owner;
b. pay all Overdue Interest due under this Agreement with or without demand by the Owner;
c. pay all Default Interest due under this Agreement with or without demand by the Owner;
d. keep the Goods in good and serviceable repair and condition and replace all missing damaged or broken parts with parts of equal quality and value and in default of so doing permit the Owner to take possession of the Goods for the purpose of having repairs carried out and repay to the Owner the full cost of such repairs. The Owner shall have a lien on the Goods until such repayment but exercise of such lien shall not prevent the accrual of Hire Rent hereunder;
e. permit the Owner, its servants or agents and any person authorised by the Owner at all reasonable times to enter upon the premises in which the Goods are for the time being placed or kept for the purpose of inspecting and examining the condition of the Goods;
f. keep the Goods at all times in the Hirer’s actual possession and control and properly housed,
sheltered and protected wherever they may be, and not remove the same from without the prior approval given by the Owner in writing, and undertakes to maintain the Goods at such location as appear in the record of the Owner or otherwise the Owner may direct from time to time and shall not move the Goods to a different location without prior written consent of the Owner;
g. on demand by the Owner provide it with such particulars material to the Hirer’s financial status and to the situation, state and condition of the Goods as the Owner may reasonably require;
h. notify the Owner as soon as possible of any difficulty in repaying the loan (or any part thereof) or in meeting any payment to the Owner arising from the loan or otherwise pursuant to this Agreement;
i. notify the Owner forthwith of any change in the Hirer’s address and upon request by the Owner promptly inform the Owner of the whereabouts of the Goods;
j. in the case of the Hirer being a sole proprietor, a partnership or a corporation, obtain the Owner’s
written consent prior to any changes of ownership of the Hirer;
k. indemnify the Owner and keep the Owner effectually indemnified, if necessary by payment in cash on demand, from and against all losses, damages, costs, charges, expenses and liabilities which may be suffered sustained or incurred by the Owner and all actions, suits, proceedings, claims or demands of any nature whatsoever which may be taken, made or threatened against the Owner or which may arise directly or indirectly by reason of the Owner entering in this Agreement or becoming the Owner of the Goods or by reason of the operation of this Agreement or the enforcement by the Owner of any of its rights and remedies herein or by reason of the termination or early termination of this Agreement or by reason of the transport of the Goods from or to, or their installation or presence in or upon, any place, or their use or misuse, whether or not due to any act or omission of the Hirer save insofar as the same may occur as a result of the negligence or wilful default of the Owner;
l. punctually pay for all work done to the Goods and for spare parts and accessories thereto and keep the Goods free from any distress execution or other legal process and pay all fines and penalties imposed at any time with respect to the Goods before or (until the Hirer redelivers the Goods to the Owner) after the termination of this Agreement;
m. obtain all necessary licenses permits and permissions for the use of the Goods and not use the Goods or permit the same to be used contrary to any law or any regulation or bylaw for the time being in force and keep the Goods in condition (if any) required by law and comply with all legislation affecting the same whether presently in force or subsequently enacted;
n. lodge with the Owner all documents of the title (whether original duplicate or counterpart thereof) relating to the Goods, including but not limited to (where the Goods being a vehicle) vehicle registration document, other registration documents, invoice, bill of lading and documents of similar nature whenever required by the Owner together with a transfer of ownership form signed by the Hirer undated and with the transferee’s name left blank and the Hirer hereby authorizes the Owner as its agent to complete such form on its behalf;
o. pay the Owner on demand all reasonable amount of expenses (including without limitation legal costs and expenses on a full indemnity basis and/or commissions for debt collection agencies) reasonably incurred by or on behalf of the Owner in ascertaining the whereabouts of, taking possession of, preserving, insuring and storing the Goods and in maintaining the same in good order and repair and disposing of the Goods and of any legal proceedings taken by or on behalf of the Owner to enforce the provisions of this Agreement together with Overdue Interest and/or Default Interest as aforesaid;
p. not apply or by any means howsoever obtain any copy or duplicate or counterpart of any documents of title relating to the Goods, including but not limited to vehicle registration document, other registration documents, invoice, bill of lading, insurance policy and documents of similar nature without having first obtained the prior written consent of the Owner provided that in giving such consent, the Owner may impose such condition or conditions as the Owner in its absolute discretion may consider appropriate and any breach of such conditions so imposed by the Owner shall be a breach of this Agreement;
q. not sell assign let pledge mortgage charge encumber or part with possession of or otherwise deal with the Goods or any interest therein or in this Agreement or the Option to Purchase herein contained or create or allow to be created any lien on the Goods whether for repairs or otherwise and in the event of any breach of this sub-clause by the Hirer the Owner shall be entitled (but shall not be bound) to pay to any such third party such sum as is necessary to procure the release of the Goods from any charge incumbrance or lien and shall further be entitled to recover such sum from the Hirer forthwith together with Overdue Interest and/or Default Interest as aforesaid;
r. not use the Goods or permit them to be used for any purpose for which they are not designed or for which they are not reasonably suitable nor, if the Goods comprise a motor vehicle, use the same or permit the same to be used for racing or in any rally, trial or competition or permit the same to be used by a learner driver or for the purpose of instruction unless the prior approval of the insurers has been given in a form acceptable to the Owner.
7. Loss and Damage of the Goods
7.1. Where the Goods are lost stolen confiscated destroyed or damaged by the negligence or wrongful act of a third party the Hirer shall immediately notify the Owner thereof and shall not compromise any claim without the prior written consent of the Owner and shall allow the Owner to take over the conduct of any negotiations (except in relation to claims of the Hirer for personal injuries loss of use of the Goods or loss of or damage to the property of Hirer unconnected with the Goods) with insurers or other parties and shall at the Hirer’s own expense take such proceedings in the Hirer’s sole name or jointly with the Owner as the Owner shall direct, holding all sums recovered (together with any moneys received by the Hirer under any policy or policies of insurance taken out by the Hirer pursuant to the provisions of this Agreement) on trust for the Owner and paying or applying as the Owner directs the whole or such part thereof as is necessary to discharge the Hirer’s liability to the Owner hereunder at the date of such payment and to compensate the Owner for the loss theft or destruction of or damage to the Goods any surplus being retainable by the Hirer for his own benefit.
7.2. The Owner shall deal with any proceeds of insurance and other moneys recovered from the third parties. Upon such payments, this Agreement shall immediately come to an end and subject to any rights of the Owners therein the title of the Goods shall vest in the Hirer.
7.3. Subject as aforesaid, the loss, theft or destruction of, or damage to the Goods shall not discharge this Agreement or affect the Hirer’s liability for payment of any sums payable hereunder.
7.4. During the continuance of this Agreement, the Hirer shall indemnify and keep the Owner effectually indemnified against loss, theft, confiscation or destruction of or damage to the Goods from whatever cause (whether or not such loss or damage results from the Hirer’s negligence or the negligence of any other person whether having use or control or possession of the Goods or not) and if the Goods are a complete loss or so damaged as in the reasonable opinion of the Owner to be unworthy of repair, the
Hirer shall (regardless of whether or not any moneys are payable under any insurance policy) pay within seven (7) days of such loss or damage an amount equal to the amount which would have been payable if this Agreement had been terminated by the Hirer when the Goods were so lost etc. and this Agreement shall terminate upon such payment being made but without prejudice to any claims then existing.
8. Warranty and Indemnity
8.1. The Owner shall not be obliged to provide the Hirer with any replacement goods (nor to repair the same) if the Goods are lost, damaged, confiscated, seized or otherwise appropriated or rendered unfit for whether temporarily or permanently.
8.2. No liability shall attach to the Owner either in contract or in tort for loss, injury or damage sustained by reason of any defect in the Goods, whether such defect be latent or apparent on examination, and the Owner shall not be liable to indemnify the Hirer in respect of any claims made against the Hirer by a third party for any such loss, injury or damage.
8.3. Any liability the Owner might otherwise incur and any right or immunity the Hirer might otherwise possess in respect of any conditions warranties or representations relating to the condition for the Goods or to their merchantable quality or suitability or fitness for the particular or any purpose for which they are or may be required whether such conditions warranties or representations are express or implied and whether arising under this Agreement or under any prior or collateral agreement or in oral or written statements made by or on behalf of any person in the course of negotiations in which the Hirer or his representative may have been concerned prior to this Agreement are hereby excluded.
9. Early Termination by Hirer
9.1. Provided that the Hirer is not in breach of any Terms and Conditions, the Hirer may at any time before the final instalment of Total Rent falls due terminate this Agreement by giving the Owner not less than seven (7) days notice; by delivering up the Goods to the Owner at such place as the Owner may prescribe; and by making payment to the Owner of such sums as shall be payable
10. Amendments
10.1. This Agreement may be amended or modified, and any of the terms, covenants, representations, warranties or conditions hereof may be waived only by a written instrument executed by the parties hereto or, in the case of a waiver, by the party waiving compliance.
11. Severability
11.1. If any provision of this Agreement is held by any court or other competent authority to be void or unenforceable in whole or part, the other provisions of this Agreement and the remainder of the effective provisions shall continue to be valid.
12. No rights for Third Parties
12.1. A person who is not a party to the Agreement shall have no right under the Contracts (Rights of Third Parties) Ordinance to enforce any of its terms.
13. Law and Jurisdiction
As witness this Agreement has been executed by or on behalf of the parties the day and year first before written.
