Bill of Sale?????

[sgball]

In light of Learners problems and his valued advice to me, I have a question about the Bill of Sale.

Bill of Sale from the last owner to the current owner. Section 2: Details of Sale 'the receipt of which is acknowledged, transfer 64 (SIXTY FOUR) share in the above ship and its appurtenances to the transferee'

WHO OWNS THE OTHER 36 SHARES?

I also have a copy of the 'Certificate of British Registry' Issued 2000 Expires 2005.

Is it time to pull out in sympathy with Learner.?

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[coliholic]

Byron will tell you all about this but it's dead right. Ships traditionally were owned in 64ths. Can't remember why but Byron'll tell us all again.

Main point is it's pefectly correct. You're buying 64/64ths of the boat, there is no missing 36 'cos you've assumed that there's 100 shares and there's not.

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[oldgit]

Have got all previous paperwork for my boat from new. About 6 owners in total.All bits of paper have that 64 ths thing on them.Very interessting to be able to see prices paid by former owners of boat along with their respective occupations.

<hr width=100% size=1>Oooh look its still not dark and its nearly 5pm

 

[byron]

<font color=blue>No panic. Col is right. Traditionally a vessel is in 64 parts, you now own all 64 parts.

<hr width=100% size=1>http://www.alexander-advertising.co.uk

 

[sgball]

We don't own any of it yet. Still looking through all the paperwork!

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[Observer]

As said, ownership of a ship is, by tradition, divided into 64 shares. I think it started in the days when a ship was financed by two or more owners who would each take a share of the profit from a particular voyage. The number 64 facilitates a wide combination of varying proportions of ownership expressed as a number of shares without resorting to fractions.

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[byron]

<font color=blue>Since early days vessels were divided up in 64ths. This allowed people to buy a part of the action of a trading vessel.
No one is really certain how this came about.

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[sgball]

I think it is very interesting - they say you learn something everyday.
Trudie


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[Guest]

You will, if you buy it, end up owning 64/64ths in exchange for 'the sum of one pound and various other considerations', too, FWIW...

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[Tiger Rag]

Everyone is correct in saying that yachts have for some time been sold in lots of 64 shares, just wanted to add that the practice of entering "one pound and other considerations" onto the bill of sale is illegal, it is very rare that you will ever have a problem with this but it is safer (if you wish to conceal the exact amount you paid for the vessel) to come to a mutually acceptable figure with the seller and enter this onto the bill of sale. Not trying to worry you, jsut best to protect yourself.

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[Observer]

Russell,

Can you expand on <<the practice of entering "one pound and other considerations" onto the bill of sale is illegal<<?

I can understand why concealing the true value of a conveyance made by a bill of sale for other assets would be illegal (implies an intent to avoid stamp duty) but I was under the impression that bills of sale of ships are exempted from stamp duty regardless of value.

Not being picky - just interested to know.


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[jfm]

Russel plse explain illegal

Yes there is definitely no stamp duty on a ship conveyancing document, in the UK. I too am perplexed by Russell's statement that it's illegal to use those words. I have done it zillions of times (not just on boats) and lots of lawyers do, so I'm intrigued to hear why it's "illegal", and under which country's laws it is thought to be "illegal" (Russell is in Spain - praps he means illegal under Spanish law?). Thanks for any info you can provide

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[Tiger Rag]

Re: Russel plse explain illegal

You are quite right I was referring to the Spanish courts, there was a case about three years ago, where a yacht owner was suing a local shipyard for damages. The judge after examining the paperwork ruled that the owner had deliberately falsified legal documents (i.e. bill of sale), then not only threw the case out but tried (as it eventually turned out) unsuccessfully to have the owner prosecuted! As I say, this is thankfully the only case I have ever heard of, but we and all other reputable companies have stopped using the term just to be 100% certain.

There is also a strong possibility that as the shipyard was owned by a Mallorcian a few favours were called in and the judge would have done anything he could to dismiss the case, so probably wouldn't hold much water in the British courts but it seems foolish to tempt fate.

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[MedDreamer]

Re: Russel plse explain illegal

Is this because of the "wealth tax" in Spain? We don't have such a thing in the UK because the government has decided to ensure that no-one has any wealth to tax

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[jfm]

thanks russell

Aha all ok. I spect it was as you say, "local influence" etc. This language is certainly not illegal in the UK and in a normal boat transaction is not at all falsification of a document as that concept applies in the UK. So it's perfickly ok to say "£1 and other considerations" imho

Incidentally, in the UK form of property transactions the seller (only) executes the conveyance or bill of sale, pusuant to a quite separate contract enterted into between buyer and seller. Therefore the buyer could never be accused of falsifying a document no matter what garbage was written on the BoS.

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[Observer]

That clears that up

I don't use bills of sale very much (if at all) in my business (except on ships) because of the stamp duty issue. If one uses the "£1 and other considerations" language, does one always add (if applicable) the "This does not form part of a larger transaction or series of transactions with a value or aggregate value exceeding £60,000" language? And also if the actual value of consideration is expressed but is less than £60,000?

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[jfm]

Re: That clears that up

No, it's not quite like that. UK stamp duty is a tax on the very creation of a conveyance document where the price >£60,000. It is not a tax on a buy/sell transaction, as say CGT is.

So people normally avoid stamp duty by not executing a conveyance document. Frexample, if you bort a car for £60,000, title to that car would pass to you by physical delivery of it to you in the dealer showroom, not by the dealer executing a conveyance document.

UK land is different from cars because it has to be transferred by written conveyance, nothing else is effective (Law of Property Act 1925). So stamp duty is payable on the conveyance document, unavoidable.

Some categories of property (ships, intangibles) benefit from a specific stamp duty exemption so you are free to transfer them by written conveyance and still there is no stamp duty

To answer your wquestion, if one uses the "£1 and other considerations" language one could add the language "this does not form part.....£60,000" because that would be helpful stamp duty wise, but of course only if it is true! Where it is not true, you can only avoid the stamp duty by not having a conveyance document at all, as per above. Or you might have an exemption (eg ships, intangibles, etc). Or you would find some other "loophole" like keeping the conveyance document offshore. Failing all that, you have to pay duty (eek).

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