Retention of title – the devil is in the detail
2 August 2018: BRI Business Recovery and Insolvency, when acting as Liquidators or Administrators of a company, often deal with creditors who have supplied products to the company claiming retention of title (ROT).
Often the products will have been sold in the normal course of business, therefore there is no ability to claim ROT. However, there are also times when the product is held and a review of the validity of a ROT is needed.
There can be many reasons why ROT claims are not legally valid. One such reason is because terms and conditions of trade between the insolvent company and supplying creditor have not been agreed.
The devil is in the detail and we would urge any supplier of products to review their terms and conditions to ensure that, if one of their customers enters into an insolvency procedure, they are able to mitigate their losses by looking to reclaim goods previously supplied.