boat purchase and legalities

[gonfishing]

i have come to the conclusion, that buying a boat from whatever source and by which ever means is nothing short of a minefield, given the cost of purchase of a vessel is equal to or more than the cost of purchase of a house (certainly applicable to certain areas of the country at least) why there is not a company or legal dept within a solicitors practice that can facilitate the sale and purchase of a vessel ,in the same manner as a house, another couple of hundred amongst the thousands involved, would seem to be a prudent investment, i am beginning to feel somewhat underwhelmed at the prospect of getting to the stage where i find what i am looking for, but will be afraid at parting with the hard earned, in case it all goes sour, and a couple of grand has gone down the swanny,a bitter pill to swallow, and another lesson in life? all i want is to go cruising and fishing not another b****y ulcer,and a stint of blood pressure.

there i feel better already!!!

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[hlb]

Whats yer problem. You want a boat. It's within your means. You buy it from the seller Or agent. They will hapily show you bills of purchase. Or proof of ownership. Buying a boat is very simple. Pay cash. get boat. Buying a house is far more complicated.

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[gonfishing]

your probably right ,guess i am reading to deeply into things and taking to much note of other peoples nightmares and mishaps, still should be cautious though, the tree in the garden isn't doing much at the moment! i will disagree on the house front though, i've always found that straight forward, she finds what she wants i agree, easy!!!

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[JerryHawkins]

Use a reputable broker

I think you're safer is you buy through a reputable broker. I bought my boat through Ancasta. As a buyer it costs you no more, its the seller who pays comission to the broker (OK price may have been bumped up a bit, just negotiate it down to a price you're happy to pay!). Your money goes into a "client account" and the seller doesn't get it until the paperwork is signed and the boat is legally yours.

No doubt some people have horror stories about buying through brokers too. At some point someone has to trust someone - go with your "gut-feel", of the boat itself, the current owner (if you can get to meet them) and the broker. If all three come across as genuine and you're survey is good - just go for it!

Enjoy your fishing - tight lines!!

Cheers,

Jerry

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[Observer]

Safer through a broker?

Possibly "Yes" but also definitely "No".

"Yes" because a reputable broker has a reputation to protect and it is reasonable to expect that he will act professionally. He also has or should have considerable expertise and experience in the purchase and sale of boats so should be able to give good advice on matters such as title, surveys, registration etc. However, never forget that it is almost certainly in his direct financial interest to arrange a sale at the highest price possible - broker and buyer have fundamentally conflicting interests.

"No" because he is the seller's agent and you have no recourse to him if sonething goes wrong. You do not have a contractual relationship with the broker, only with the seller and the broker does not owe you a duty of care - so you would not be able to sue him. The "let the buyer beware" cautionary principle should be applied no less thoroughly if you are buying a brokerage boat than a non-brokereage boat.


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[jfm]

broker\'s duties to buyer

Observer that's 99% true but there is an exception which is important. Brokers often hold the deposit as stakeholder, not as agent of seller, and therefore the broker owes the buyer a duty at least in that regard. Buyers should insist on "as stakeholder" and reject "as agent" in the contract, as regards holding of the deposit, imho.

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[Observer]

Re: broker\'s duties to buyer

Agreed - but if there is merely a provision that the broker is holding money "as stakeholder", doesn't it beg the question "on what terms?". I don't think it is the case (please correct me if I'm wrong) that funds held by the broker "as stakeholder" are held "to the buyer's order". Therefore, absent a formal and appropriately drafted escrow agreement (which I assume most brokers would not have), if there is a dispute, the buyer may still be unable to recover his money.

If the amount concerned is not large (whatever that may mean to different buyers), "as stakeholder" may of course be sufficient comfort.



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[Trevor_swfyc]

Agree it is a worry, but if you phone an advert and the guy says he will meet you half way on the M25 services then you are asking for trouble.
On the other end of the spectrum is a broker selling maybe in a marina for a large list of clients.
One thing is to make sure you get a list of what you are buying and get it clear what is regarded as personel items that will be removed.
It is very annoying to find you have to buy a lot of items that were on the boat when you saw it, but were later removed. A broker will certainly do this and should check to see that it is correct.

Trevor



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[jfm]

Escrows - getting a bit heavy on the legals now!

Yes. I have often wondered that myself. Normally when buying real property in the UK the vendors solicitor holds the deposit as stakeholder (except developers often try to get "as agent" terms). There is no escrow agreement governing how the stakeholder will behave. Buyer's solicitors invariably advise their client that this is all jolly good etc. Thus I assume that there's an escrow arrangement consisting entirely of implied terms (!) that stakeholder will give money to most deserving person, and of course if it is big £££ and it is unclear who should ge tthe money, no doubt stakeholder might ask court to declare... (Perhaps with housebuying the escrow terms are written into the Standard Terms and Conditions, which I haven't read for ages)

Dunno really, that could be completely wrong. But even without an express escrow agreement, "as stakeholder" gives buyer much protection. Eg it stops vendor scarpering with the money until delivery of boat, and in many common cases (eg vendor goes bankrupt, or has no title) it's pretty clear that broker's duty is to give £££ back to buyer. Becuase the broker is clearly accepting some duty to the buyer, he has some skin in the game and is not going to give the money to vendor just cos vendor (his client) asks him to. Thus, it is worthwhile imho.

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[Observer]

Getting a bit heavy on the legals now!

Maybe - but if there's enough at stake...

I agree stakeholder status is "worthwhile" - just not watertight. Also, there is a difference between a solicitor holding funds as stakeholder and a yacht broker. Solicitors are relatively highly regulated (well self-regulated) and will have a client account as a matter of course. Not so sure with a yacht broker. Big ones maybe. So you have the additional potential concern of the broker's solvency. All very well having a right of action against broker. Not much use if he hasn't the substance to meet the claim.

All I am doing is identifying risks (which happens to be a large part of what I do for a living) and the risks are the same irrespective of the amount. Up to individuals to decide how far they wish to go, in any given circumstances, to reduce the risks.

I agree with your comments generally and (like you) I wonder if there is an accepted legal definition of what is expected of a "stakeholder", where there are no express terms. Think I might try a google.

Best rgds.

Tim

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[jfm]

Insolvent stakeholders eek!!

Hmmm yes all agreed. Not sure if brokers use client accounts, and if they do whether they're regulated. Whereas solicitors get massively yelled at by law society bods even if they accidentally put 25p of client money into non client account. So I agree, the whole thing could go belly up if you buy a boat from an entirely honest seller and it turns out the blimmin broker (=stakeholder) has gone bust with your 10% deposit! Aaaargh!! Big escrow agreement needed. OR....get a solicitor to hold the deposit (titter)

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