Bill of Sale sum = 1 Euro plus considerations

[Medex]

Just wandering if this is common practice on a Bill of Sale to have this stated as the sum of transaction value.

With a yacht I am looking at purchasing, the Maltese Bill of Sale has wording (Body Corporate) next to the title and states the sum value being 'One euro and other considerations'.

Now I have the original VAT invoice from the Dealer to 'a company'. This Bill of Sale is from 'a company' to the current owner.

The reason I see this being stated is so the true transaction value was not disclosed which according to the dealer is legit in Malta.

Has anyone experienced this and is it common, and will i have issues with re-sale do you think?

thanks again for the advice.

 

[pvb]

It's common, and shouldn't affect resale.

 

[JVL]

It's common, seen a lot of Bills of sale "£1 plus other consideration" even my own. The law is not interested in the price of a bargin.

John

 

[jac]

Mine have always said that as well. Purpose is to show that a contract has taken place with exchange on both sides but prevents the bill of sale being used by either side as a measure of value of the boat.

 

[Boo2]

Just wandering if this is common practice on a Bill of Sale to have this stated as the sum of transaction value.

My bill of sale says that too, I made sure to get a receipt in addition, for the actual amount paid.

I believe brokers do this to insulate people from future buyers who will look to reduce the price paid based on the low price the seller paid when they acquired the boat. Or something ?

Boo2

 

[Tranona]

The reason for that phrase is that for a contract to be valid legally under UK contract law there needs to be a recognition of "consideration" - which does not necessarily mean the actual money that changes hands. This phrase meets that requirement, and the receipt the evidence for the two parties involved showing the actual consideration. For example if you did a part exchange, the receipt would show the cash element and the asset at agreed value (just as in the contract) but the 2 Bills of Sale transferring title would only show the "£1 and other considerations" phrase.

Nothing really to do with hiding the actual amount to avoid bargaining in the future, nor avoiding taxes etc. - just reflecting that only two people were involved in that transaction and the terms were private between them.

 

[Medex]

Thanks again for the info and advice :encouragement:

 

[Mistroma]

Brings back memories of buying my previous boat back in 1986. I'd driven down to South coast of England and thought something was dodgy when I spotted the "£1 and other considerations". However, I was able to check that this was quite a common practice in England. I imagine it might be phrased differently in Scotland as Scots law does not require "consideration" for a contract to be formed and I think English law does.

 

[lpdsn]

Mine is the same, and the bill of sale for the previous transaction. I have a VAT invoice for the full amount as my purchase was a VAT-able transaction.

Also bear in mind that, technically, in the UK & Ireland at least, stamp duty may be applicable on the contract and perhaps that the original cause of the practice. Malta may also have inherited rules on stamp duty from the UK.

 

[jfm]

The reason for that phrase is that for a contract to be valid legally under UK contract law there needs to be a recognition of "consideration" - which does not necessarily mean the actual money that changes hands. This phrase meets that requirement,

Tranona, remember that the BoS is merely an instrument of conveyance (of transfer of ownership of registered property), not a contract. The contract is elsewhere.
The true reason for stating the consideration on the BoS is probably not known by anyone but my guess would be that someone put it on there thinking "good idea", and it certainly does no harm. Then others thought "Well it doesn't really belong there because a BoS isn't a contract, but rather than leave the box blank and confuse people we'll write '£1 plus other'" and so the practice developed I guess.

To OP, I too agree that the £1+ or €1+ is perfectly fine. All my BoS received and given contain this phrase

 

[jfm]

Also bear in mind that, technically, in the UK & Ireland at least, stamp duty may be applicable on the contract and perhaps that the original cause of the practice.

Um, that isn't correct (I can explain why if you wish!).

 

[lpdsn]

Um, that isn't correct (I can explain why if you wish!).

OK. Always curious.

 

[lw395]

Just wandering if this is common practice on a Bill of Sale to have this stated as the sum of transaction value.

With a yacht I am looking at purchasing, the Maltese Bill of Sale has wording (Body Corporate) next to the title and states the sum value being 'One euro and other considerations'.

Now I have the original VAT invoice from the Dealer to 'a company'. This Bill of Sale is from 'a company' to the current owner.

The reason I see this being stated is so the true transaction value was not disclosed which according to the dealer is legit in Malta.

Has anyone experienced this and is it common, and will i have issues with re-sale do you think?

thanks again for the advice.

I might want re-assuring about the VAT status?
If the company was VAT registered, I would want to see a proper VAT receipt from when they sold the boat.