When an account customer suddenly stops paying, and goes into liquidation, you need to ensure that your trading documentation contains the requisite terms to maximise your prospects of a recovery in such an event.
When did you last update your trading documentation? If your response is before 2012 then you will need to review your trading documentation to bring it in line with current legislation, particularly the Personal Property Securities Act 2009. For more information on the Personal Property Securities Act 2009, or the PPSA as it is now commonly referred to, please visit the PPSA page on our website.
Bennett & Philp Lawyers have extensive experience in drafting credit applications and trading terms and conditions. The primary purpose of your trading documentation is to protect your business. Bennett & Philp Lawyers can review your current trading documentation and provide you with advice on amendments to suit your business.
To be able to register a security interest on the PPS Register, which is enforceable against third parties, your trading terms need to form a written security agreement and must contain a valid retention of title clause.
Some common questions Bennett & Philp Lawyers ask clients when reviewing existing terms and conditions are as follows:
- Are your procedures for quotations and orders adequately detailed?
- Are your payment terms clearly defined?
- Do you have a provision to charge interest on overdue accounts?
- What are your arrangements for delivery? What happens if you fail to deliver goods?
- What are your procedures for defective goods or services?
- Is there a valid charging clause in place?
- Is there a valid retention of title clause?
- Do you have a personal guarantee?
Bennett & Philp Lawyers can also provide you with advice in relation to implementing your trading documentation: from the basic requirements of having properly executed agreements to registering your security interests on the PPS Register.
If you would like more information and advice on your trading documentation then please call us today.