Help please, totally stuck in a very bad place after a yacht sale, dispute! Help!

[pvb]

I find this whole story very strange. Almost every broker uses a standard contract form which usually starts with "The Seller agrees to sell and the Purchaser agrees to buy the (boat model) named (boat name) and any extras and equipment listed in the sale particulars (together "the Boat") "AS IS WHERE IS" in accordance with the terms of this Agreement."

If that sort of wording was in the OP's contract, then he should get all the gear listed in the sale particulars. A broker may try to point to some sort of disclaimer on the sale particulars, but this won't apply.

 

[KellysEye]

>On what basis do you state that the inventory was purposely misleading?

The OP said 'Having paid the negotiated price then paying full it has come to light that many things on the brokers inventory are missing plus a few extra things that were on the boat by the old owners admission were also missing'. 11 items in all with a value of 8,000 pounds. The items were in the inventory but not on the boat thus the inventory was misleading and I think the purpose was to increase the value of the boat. Hence purposely misleading, it's down to the owner to prove that isn't the case preferably in court.

It's noteworthy that the OP hasn't commented on almost any post and if the police and Trading Standards are going to be involved.

 

[Tranona]

>BTW it is not held in an escrow account but in a trust account, which is subtly different.

My understanding is all money held by a broker, solicitor etc waiting for the contract to be signed is held in an escrow account, it always has been when I've bought a boat or house. The differences are:

Escrow Account
An escrow account is a bank account in which escrow funds are deposited by an escrow agent. An escrow agent is an independent and impartial third party who holds money, documents and other property for parties involved in a transaction pursuant to an escrow agreement. The escrow agent will only release money from an escrow account only pursuant to the terms and conditions of the escrow instructions. Escrow accounts are ubiquitous in real estate transactions.

Trust Account
A trust account is generally used for one of two purposes. It may be opened by a trustee to hold trust funds. Sometimes money is given to a third party to hold "in trust" without the existence of a formal trust. A common example is a retainer paid to a lawyer that has not been earned. Since the lawyer hasn't earned the money, he holds it in trust for the client until such time as it is either earned or returned to the client.

No, as you see from your definition an escrow account holds documents or property to be released if specific conditions are met. So could be used for the final transfer. For example a third party could hold the keys and documents to the boat and release them when the funds clear into the sellers account.

A Trust account (sometimes called a Client account) is wider than this. The funds are held in trust for the purposes of the transaction - for example as maby explained earlier, dealers or builders can hold deposits for boats they are selling in a trust account, even though the boat does not exist at the time. The important point is that the money always belongs to the client, so the seller (builder or dealer) cannot use the money in their business. There are tests under trust law to determine whether a trust has been created by such an account and there is a recommended format that brokers use. You can read the details of what constitutes a valid trust account in the Opal Marine high court case.

In a boat sales transaction through a broker a trust account is much more convenient than individual escrow accounts for each transaction while still protecting clients funds during the process.

 

[prv]

>On what basis do you state that the inventory was purposely misleading?

The OP said 'Having paid the negotiated price then paying full it has come to light that many things on the brokers inventory are missing plus a few extra things that were on the boat by the old owners admission were also missing'. 11 items in all with a value of 8,000 pounds. The items were in the inventory but not on the boat thus the inventory was misleading and I think the purpose was to increase the value of the boat. Hence purposely misleading, it's down to the owner to prove that isn't the case preferably in court.

If the previous owner were deliberately trying to defraud the buyer, why would he turn up, freely agree that some of the things are indeed missing, and add extra things that weren't even on the inventory?

Pete

 

[Resolution]

. The items were in the inventory but not on the boat thus the inventory was misleading and I think the purpose was to increase the value of the boat. Hence purposely misleading, it's down to the owner to prove that isn't the case preferably in court.

It's noteworthy that the OP hasn't commented on almost any post and if the police and Trading Standards are going to be involved.

Assuming that the OP is referring to the contract inventory (yet to be confirmed) and that items listed there are missing, then there is most likely a contractual default on the part of the sellers and their agent, the broker. You choose to think this was purposely done to increase the value of the boat. If you knew the parties concerned you would know how far-fetched this is.
Secondly, do not be misled by the OPs figure of £8,000 value of missing kit. Heritage had been raced as hard as any Sigma 33, and pretty much all the kit on board was much-used. The mooring lines when I was last on board were old sheets, knotted and frayed, and should have been condemned!
Talk of police and Trading Standards is OTT. With a bit of common sense this will be resolved very quickly.

 

[theoldsalt]

The purchase is not complete until the buyer instructs the broker to transfer funds to the vendor. This is normally done after the buyer agrees that what he is actually receiving is what he expects to receive (actual with inventory)

Assuming the buyer has not instructed the broker to hand over the money to the vendor and if the buyer is not happy to proceed then :-

1 The OP should decide whether to back out of the purchase or renegotiate.

2 If the decision is to renegotiate then perhaps the money should be transferred back to the buyer (maybe leaving a deposit active)

3 A new inventory should be prepared, agreed and checked.

4 A new purchase price can then be agreed on the basis of the new inventory.

5 The buyer can then transfer the balance of the purchase price and instruct the broker to complete.

I have heard of many arguments about inventory after purchase is completed. That is far too late. It must be sorted before completion.

 

[GrahamM376]

I don't think you can expect too much out of the broker on this - they are just the intermediary between you and the previous owner. If you can show that they (the broker) conspired with the previous owner to defraud you, then you could sue them (the broker) but if they acted in good faith, then the fault is primarily with the previous owner for misrepresenting the boat or with you for not checking sufficiently carefully before completing the purchase. Has the money been handed over to the previous owner, or is it still in the broker's escrow account?

I bought a previous boat from the same broker and the service was excellent, would have no worries about dealing with them again. Much will depend on what was declared in the inventory at the time you entered into the contract, if the goods are not there then I think you may have a claim via smalls claim court against the seller - not the broker. If they have been stolen then presumably the sellers could claim on their insurance which should have been in force until handover.

When I sold a boat through a broker, I was instructed to leave it in the marina and give the broker the keys as the new owners couldn't be there. On arrival, I asked him to come to the boat and check the inventory was complete - he refused point blank "I'm not being held responsible if anything goes missing" was the reply. Is this normal?

 

[Rigger Mortice]

OP came on here asking for help but has not been bothered to respond to any questions. Resolution has vouched for the sellers. The broker is reputable.

Looks like a buyer probably hasn't bothered to sort out his purchase properly and has now got cold feet.
Caveat emptor.

 

[Tranona]

The purchase is not complete until the buyer instructs the broker to transfer funds to the vendor. This is normally done after the buyer agrees that what he is actually receiving is what he expects to receive (actual with inventory)

Assuming the buyer has not instructed the broker to hand over the money to the vendor and if the buyer is not happy to proceed then :-

That is not how it works. The buyer has accepted the goods by paying the broker and taking title. He does not then check the goods and "instruct" the broker to pay the funds to the seller. The broker is agent for the seller and paying him is the same as paying the seller. That is very clear in the contract he has signed.

The process of checking (survey and inventory) is carried out BEFORE any final payment is made. That seems to be the problem here. The buyer appears to have paid the money and taken possession WITHOUT checking the inventory - hence now crying foul after the event.

The advice is to recognise his error, sit down with the broker and seller to sort it out. Seems the seller is not out to deceive and unlikely the broker has done anything underhand, but there is clearly a breakdown in communication as to what was included in the sale as the story (as reported by the buyer) is different from that of the seller and the broker.

 

[Tranona]

Is this normal?

Yes. It is the buyer's responsibility to check that all he agreed to purchase is there, not the broker's. The contract is between the seller and the buyer. The broker has no responsibility for or financial interest in the boat.

 

[theoldsalt]

That is not how it works. The buyer has accepted the goods by paying the broker and taking title............

That was not the case in my recent purchase. I transfered the balance of the purchase price to the broker after accepting the survey. I then inspected the vessel to ensure it reflected the declared inventory prior to instructing the broker to release the money to the vendor. The broker then released all relevant documents to me including receipt, bill of sale, part 1 registration etc.

Others may do it differently but I believe my method protected me from inventory problems and other things like recent damage to the vessel. I wanted to be sure that I took title immediately rather than have the delay of funds being transferred to the broker when the vendor still had access to the vessel enabling him to use or damge the vessel or remove items. So I could sit on the vessel and phone the broker knowing that I had immediate title and take the keys off the vendor.

 

[Tranona]

That was not the case in my recent purchase. I transfered the balance of the purchase price to the broker after accepting the survey. I then inspected the vessel to ensure it reflected the declared inventory prior to instructing the broker to release the money to the vendor. The broker then released all relevant documents to me including receipt, bill of sale, part 1 registration etc.

Others may do it differently but I believe my method protected me from inventory problems and other things like recent damage to the vessel. I wanted to be sure that I took title immediately rather than have the delay of funds being transferred to the broker when the vendor still had access to the vessel enabling him to use or damge the vessel or remove items. So I could sit on the vessel and phone the broker knowing that I had immediate title and take the keys off the vendor.

But at that point you did not have title to the boat. The broker is still holding the money in trust for you. The seller still had title until you confirmed you were satisfied. The OP has accepted title without inspecting the boat fully so his payment is to the seller and the broker cannot withold it as title has already passed.

You were just following the contract which says that the buyer must satisfy himself that the goods are as described before completing the transaction.

If the OP had followed what you did he would not have this dispute - but he did not. All a question of timing!

 

[Alan ashore]

OP: reflecting on this thread I'm thinking "is this not all a bit out of perspective?". Are you really in a "very bad place"?
You bought 4 tonnes of 30 year old sailing boat, for I believe less than £20k. If you had known the missing items were not available, how much difference would it really have made to you before you parted with the cash?

Not to put to too fine a point on it, if you've got a sound hull and rig, in decent condition below and with a serviceable engine, then you are in an OK place, regardless of some disappointment over the missing bits. (the condition of which, BTW, have not been discussed. Think on...).

OTOH, if the basics are not worth whatever you actually paid (I'm guessing a little less than the figure above), then no amount of extra gear would turn a bad buy into a good one.

I'm not saying you should forget all about the missing stuff, but unless some miracle occurs and it turns up tomorrow, if I were you I'd suggest a realistic, very modest, compensatory figure to the seller. When ageed, meet them, buy each other a beer, shake hands and go and enjoy your boat!

 

[theoldsalt]

As has been hinted, our discussions about the right or wrong purchase procedure does not help the OP and probably the best solution is as "Alan ashore" has suggested. We can only hope that the problems over the inventory get resolved to both party's satisfaction - soon.

Buying a boat can be a very stressful experience at the best of times even when things go well - so I wish the OP the best in resolving this matter and that he soon enjoys his new acquisition.

 

[norti_raskal]

Just to get it straight here, the £8000 price list was if the items were new.
I'm not looking for £8k at all, all I want it for the items to replaced, I'm not bothered abour brand new, I just want what I was expecting to get on the inventory from the broker and the non sale inventory of missing items noted by the old owneR
Had the boat cost in excess of £100k I'm sure things might of been sorted.
Start deducting money from £15500 the brokers % starts to vappourise!
Just because I bought a cheap boat and have a tight budget doesn't mean that I am getting fobbed off.
And for those of you that were awaiting my answers to various questions, I'm sorry but I had to do important things like worry about where I am going to live and trying to get a job etc, plus I have been trying to sort out the missing items business which really should not be the case!

 

[norti_raskal]

RYA legal

I have been in touch with the RYA legal help team and they will help me sort this out or at least give me the info I need to put this whole silly state of affairs to bed!

 

[penfold]

Several posters have pointed out what is needed for that; you need to get in a room with the vendors(and ideally the broker) and establish the whereabouts of the missing inventory items, or in their permanent absence some sort of price adjustment; anything else is kite flying. Even if the RYA legal beagle recommends going to law, establishing the value of used sails and used equipment you've never laid eyes on will be an exercise in disappointment and a waste of whatever the small claims court costs these days.

When I sold a boat through a broker, I was instructed to leave it in the marina and give the broker the keys as the new owners couldn't be there. On arrival, I asked him to come to the boat and check the inventory was complete - he refused point blank "I'm not being held responsible if anything goes missing" was the reply. Is this normal?

A curious misuse of language; he may not have been liable but having the keys in his hands and the boat in his custody he certainly was responsible for it.

 

[sailaboutvic]

Has this not been sorted out yet ?
I have to say this forum is great for advice and help but there some thing that are better sorted in other ways .
All the advice in the world ant going to sort out , you need to sit down with the seller and broker , it seen to me the seller is saying the broker has remover the stuff and the broker is say it wasn't on the boat , the only way your going to find out the truth is having them in a room together , next step , find a way forwards.
Stop wasting time on here and go and get it sorted , maybe you be kind enough once you have to come back and tell all these good people who tryed to help you the out come .
Some how I get the feeling there more to this .

www.bluewatersailorcroatia.webs.com

 

[xyachtdave]

I wonder how many of the 5000+ views of this thread are from the broker and previous owner?

 

[davidpbo]

It's a similar situation to a friend's son, he bought a house, price agreed, white goods (Cooker, Fridge, Washing machine etc. ) listed as being left. They weren't, Henry tried to sort it out amicably, seller said he had taken them as price had been reduced and was not interested.

Henry is not one to be done over and instigated a claim for the missing goods through the small claims court whereupon compensation of 450GBPwas agreed. The seller was p'd off as the washing machine had broken down.