Legal Check before buy a boat? Lost Papers..

[hkikis]

Hello,

I am looking to buy a boat. Can I check by some way the HIN if it is legal without any loans or thieves?
There is a boat that I am interesting to buy and the only papers that it has is Delaware flag registry, EU tax paid document and manual.
It is a 2004 boat and he bought it at 2010 and he paid the EU VAT also in the same year.
I contacted with yard but he cannot provide me absolutely nothing for over 10years old boats they said.
No previous bill of sale, no builders certificate.
The owner has some psychology health problems so we cannot contact with them to get some info.

The owner has a big law firm office and he is famous in his area so he doesn't look scammer but in any case better safe than sorry.
I have some unresolved problems. For example how can I confirm that the engines serials are from the 1st buy.
I don't have nothing about the history of the boat.
Is there a solution to confirm that the boat is 100% legal?
Any HIN search? I used a HIN search with 20$ payment but it was US legal search.
Is there something in Europe?
Delaware can provide previous bill of sale? Are they keep file?

I know that after i will buy from him with bill of sale he is 100% responsible that he boat is legal. And as he is 11 years owner and a famous lawyer of his area I think that I don't have any type of risk.

 

[jrudge]

Where is the boat ?

 

[hkikis]

In Europe. But as I said you Delaware flag from 2010!

 

[Solent Sailor]

This has alarm bells ringing all over it! Inadequate paperwork and someone preventing you from speaking to the owner.....?

There is no EU-wide registration system that will help you so far as I am aware. I think you are looking at this from the wrong angle slightly - you need to be investigating the owner, not the boat.

So the boat is in the EU, but where is the owner? EU or US? Are you certain that this person is indeed the owner - is he named personally on the registry certificate and VAT statement for instance?

Is it the lawyer with the big office who has the psych issues, or his client?

If you are satisfied that the transaction is legitimate, there are things that you could do to satisfy future buyers and also give you some recourse if the boat does turn out to be stolen (for instance) and the police/true owner comes after you. For instance, a more than usually detailed contract between you and the vendor in which he confirms his status as owner and warrants that he is entitled to sell the boat to you. Secondly (and slightly belt and braces, because breach of warranty is a strong contractual action in its own right), he can indemnify you against any claims from third parties arising from this transaction. Being a lawyer, he should understand this and if he has nothing to hide it shouldn't be controversial if drafted properly. You will almost certainly need a lawyer of your own to draft this well.

 

[hkikis]

is he named personally on the registry certificate and VAT statement for instance?

Yes at the payment of EU VAT.

So the boat is in the EU, but where is the owner? EU or US?

EU! At the city that is the boat but he has depression and he don't talk to anyone.
He don't go out of his house for the last year.
Is it so strange?
I am talking with his daughter. Her daughter is lawyer too.

Is it the lawyer with the big office who has the psych issues, or his client?

you need to be investigating the owner, not the boat.

The owner of the boat with depression is lawyer. They have one of the biggest law firm.
Even if he is lawyer doesn't mean something. But what more to investigation about him? Haha

also give you some recourse if the boat does turn out to be stolen (for instance) and the police/true owner comes after you

He is owner of the boat the last 11 years and it is moored in a very expensive and famous marina in Europe.
I would like to think the craziest scenario. Ok if it is stolen how 11 years he has it? Police will come after me or after him? He sold to me this boat.

Secondly (and slightly belt and braces, because breach of warranty is a strong contractual action in its own right), he can indemnify you against any claims from third parties arising from this transaction. Being a lawyer, he should understand this and if he has nothing to hide it shouldn't be controversial if drafted properly. You will almost certainly need a lawyer of your own to draft this well.

Sure I will have lawyer that he will make the bill of sale and for sure he will write that the seller will indemnify you against any claims from third parties arising from this transaction.

I don't feal absolutely safe but what can i do?
Something interesting is that they accept to sell it to her daughter and make it flag of his country and then to sell it to me.
So I will have previous bill of sale in my hands. From his delaware company to her daughter.
I don't feel safe to buy with Delaware companies in any case.
Is it better now? Haha

 

[Solent Sailor]

The flag issue doesn't really make much difference - ownership and chain of title do and a few things don't add up here still. At the end of your email you are saying that you are uncomfortable buying from a Delaware company (perfectly reasonable) - but elsewhere you say that it is the individual who owns the boat. It can't be both.

Having it assigned to his daughter first and then to you could do some window dressing - but then any indemnity/warranty would presumably be from her. She may not have any assets to back that up (regardless of her profession - I've known a few fellow lawyers who haven't had two brass farthings to rub together for various reasons, divorce, gambling etc).

Owning the boat for 11 years perhaps negates/reduces the risk that it is stolen, but it does not prevent someone else having a legal claim to it. For instance - what if the engines had been replaced and the owner refused to pay for the work? The engineer could be suing him for the money and the court could have placed an injunction on the vessel for all you know. This is all probably quite fanciful, but it is possible.

I was going to write that unless this was an exceptional deal, I would be walking away - but actually, if it was an exceptional deal it may fall into the "too good to be true" category and reason to walk away in itself. Perhaps the way to look at it is how much money are you risking on this? If all were to go wrong, and you lost everything - would it be life changing?

Nothing is without risk, it is just a case of trying to find out as much as you can - and unfortunately, that isn't easy with boats.

Good luck.

 

[Irish Rover]

I bought a Deleware registered boat some years ago. Like most Delaware registered boats it was actually owned by a company incorporated in Delaware state. On the advice of an experienced agent here in Turkey what I actually bought was the company rather than the boat. The seller and I went together to the US consulate in Izmir and signed the necessary papers transferring all the shares from him to me and this was witnessed and stamped by the consulate.
I sold the boat a few years later using the exact same procedure.

 

[Hooligan]

If it looks like a dog, smells like a dog and barks like a dog.....it probably is a dog! I agree with Solent Sailor

 

[Irish Rover]

If it looks like a dog, smells like a dog and barks like a dog.....it probably is a dog! I agree with Solent Sailor

Delaware registration through company ownership is very common in Greece and Turkey for tax reasons and that aspect alone would not be enough to put me off buying if I was keen on a particular boat. The beneficial owner not being readily available or accessible is not ideal but if he is, as said, a prominent lawyer in good standing I think it should be possible to sort out any doubts the op may have.

 

[Gwylan]

Frankly I would walk away. Tell them to contact you when they have sorted the title and VAT status out.

Unless they are selling it for 1 Dollar, Euro or Pound.

 

[wwalsh]

It needs at least the bill of sale from previous owner to him and the deletion certificate (if relevant) from previous flag.
If any companies are involves in sales it needs documents about the company registration and documents concerning who is authorised to sign for the company etc.
CE certificate for the yacht is very important, for certain flag registrations including Greek flag it is required.

Generally if any of the following items are not available

- Complete documents for the sale history
- CE Certificate with the HIN number of the yacht, dated/stamped/signed.
- VAT payment document (if relevant)
- The correct HIN number marked on the yacht

It is better to walk away

After the yacht is sold and especially some years later (when you want to sell the yacht) the previous owner wont help.
For builder certificate or CE certificate the answer we hear most often from yards these days is that the yard was bankrupt and sold and no longer can help for the old boats.

 

[Solent Sailor]

Generally if any of the following items are not available

- Complete documents for the sale history
- CE Certificate with the HIN number of the yacht, dated/stamped/signed.
- VAT payment document (if relevant)
- The correct HIN number marked on the yacht

It is better to walk away

I agree with everything you say in principle, and the vast majority of it absolutely. However, at the risk of being entirely contradictory to what I've said above, there are cases where it pays not to be too pernickety about paperwork - for instance, I bought a 21ft motor launch a few years back for around £15k. I did some work on it, enjoyed using it for a couple of seasons and sold it on at a considerable profit. It had minimal "legal" paperwork. Being a production model, the CE cert was not of interest to anyone. Being a small fishing/day boat which had extensive servicing paperwork to show it had probably never been outside of the UK and had previously been known to have been in various UK ports, I took a gamble on the VAT status. We all know it would have been paid, but I couldn't prove it to anyone. Equally, there was very little in the way of chain of title - except to the last owner from whom I bought it. Having met him and been to his home, I was reassured that it was a genuine sale.

In one sense, this was all a gamble on my part - but all I was set to lose was £15k which whilst extremely irritating would not have put me on the breadline. Looking at it another way, I had done everything reasonable and nobody was going to do any better than what I'd achieved. The next buyer was very happy with what he bought and didn't have half the concerns that I had. It helped that it was a very popular model though, so if I had found a (perhaps duly) sceptical buyer, then another one would have been along in a moment.

 

[davidej]

Can you get insurance against this?

When you buy a property with some title defects, insurance is readily available and usually quite cheap.

 

[hkikis]

They found a copy of the bill of sale 11years old. A company sold it to his delaware company.
The bill of sale form of delaware are ridiculous simple but ok what can we do.
It just write companies and hull number. My lawyer confirm that this is the delaware's bill of sale.
Irish Rover
Your delaware registration or bill of sale write about engines for example? No....
I cannot understand why some flags have so ridiculous simple paperwork.

Anyway we have
- Bill of sale
- Proof for EU VAT (I ask of the goverment of the country that he paid the vat to give me an original proof, not copy)
- Delaware flag registration
- Delaware company file record
- Manual

CE is generic without HIN so I can find it.

No
Builders Certificate
Declaration of Conformity

Can you get insurance against this?
When you buy a property with some title defects, insurance is readily available and usually quite cheap.

I have no idea what type of insurance do you mean.

 

[Irish Rover]

They found a copy of the bill of sale 11years old. A company sold it to his delaware company.
The bill of sale form of delaware are ridiculous simple but ok what can we do.
It just write companies and hull number. My lawyer confirm that this is the delaware's bill of sale.
Irish Rover
Your delaware registration or bill of sale write about engines for example? No....
I cannot understand why some flags have so ridiculous simple paperwork.

Anyway we have
- Bill of sale
- Proof for EU VAT (I ask of the goverment of the country that he paid the vat to give me an original proof, not copy)
- Delaware flag registration
- Delaware company file record
- Manual

CE is generic without HIN so I can find it.

No
Builders Certificate
Declaration of Conformity


I have no idea what type of insurance do you mean.

I'm glad to see you are making progress.
As I told you previously I bought the company rather than the boat itself because it suited me to keep the Delaware flag registration. Unfortunately I no longer have any of the paperwork as it was a long time ago. The transfer of ownership form which was witnessed and stamped by the US Consulate was also a very simple document which confirmed ownership of the boat [make, model, year and HIN number listed] and also warranted that neither the boat or the company had any outstanding debts, liens, mortgages etc. It was all very simple, basic and, I suppose, so much bullshit as there was no actual proof of anything. However, even though I didn't personally know the seller, I was able to establish that he was respectable retired businessman who had owned the boat for some years and I was happy it was not a scam.
My opinion, for what it's worth, is that if you are dealing with a known respectable seller and especially since he and his daughter are well known lawyers it is probably all above board. If a couple of lawyers were going to pull a scam I think they'd find a bigger payday to justify the risk.

 

[hkikis]

It was all very simple, basic and, I suppose, so much bullshit as there was no actual proof of anything.

This is what I don't like. No proof of anything. An unknown bullshit company sell you something that none check something.
For example do you have a paper that proof the engines are yours? No...
Your bill of sale write engine numbers?
This is how delaware, dutch and other flags like this are working.
If you want to be safe you must check the seller status. Flags registration don't check anything.

In my case I will NOT buy from ANY company. I will buy from a person. His daughter or from him. I fear to buy from offshore companies.
So the responsibility for everything will be them.

Boats aren't like cars. In cars there is MOT check every year. In boats never. Neither when is new they will check it.
Be careful boats are easy thing for scams. I am searching history from new until now.
Now I found bill of sale and invoice from previous owner. But it isa company and i don't know how to find details.
You must search a lot of things and to be sure you must buy from a legit person.

 

[Irish Rover]

This is what I don't like. No proof of anything. An unknown bullshit company sell you something that none check something.
For example do you have a paper that proof the engines are yours? No...
Your bill of sale write engine numbers?
This is how delaware, dutch and other flags like this are working.
If you want to be safe you must check the seller status. Flags registration don't check anything.

In my case I will NOT buy from ANY company. I will buy from a person. His daughter or from him. I fear to buy from offshore companies.
So the responsibility for everything will be them.

Boats aren't like cars. In cars there is MOT check every year. In boats never. Neither when is new they will check it.
Be careful boats are easy thing for scams. I am searching history from new until now.
Now I found bill of sale and invoice from previous owner. But it isa company and i don't know how to find details.
You must search a lot of things and to be sure you must buy from a legit person.

If you're not comfortable then, by all means, it's best to look for another way of doing it. Buying and selling through Delaware companies is a well known and established practice here in Turkey and I personally knew others who had done so which made it easier for me. I'm not saying it's without risks but all the best business deals I've made have had an element or more of risk.

 

[hkikis]

I don't want risk for 500k hahaha
But ok I feel comfortable as the boat will be EU legit flag and not in any company. And the seller is good standing.
The seller has the responsibility for what is selling.

 

[Irish Rover]

I don't want risk for 500k hahaha
But ok I feel comfortable as the boat will be EU legit flag and not in any company. And the seller is good standing.
The seller has the responsibility for what is selling.

I wish you the very best of luck with it.

 

[Solent Sailor]

hkikis - I'm still not convinced that you are clear on who you are transacting with.

If the individuals don't own the boat themselves (i.e. it is owned by the Delaware company) then the bill of sale must be with that company.

Even if you were to have a contract with the individuals, you may find yourself not really owning the boat at all if they are not the legal owners.

Alternatively, if you enter into a contract to buy the boat from the Delaware Co, and then have a side agreement with the individuals (because as I say, I would want them to indemnify you against the risk you may be taking on) then it may be enforceable in law for lack of consideration (it would be under English law, Greek law may differ). Relying on an indemnity/warranties from the Delaware company is not recommended - it probably has no other assets than the boat.

Perhaps though you are just saying that you trust the individuals concerned? Saying that the seller is repsonsible for the sale is not accurate if you are relying on things said by an individual who doesn't own the boat. Even if he owns the company, it is a separate legal person.

Either way, if the transaction is in the region of Euros500k, I would be using my own lawyer to check all of this.