New Boat Paperwork

[Guest]

Firstly, I just want to say thanks for all the advice I've had off these boards since I started reading them about a year ago. I'm afraid I'm one of those people who don't tend to log in, & just read. Well in truth, with my realtively small amount of yachting experience, I have'nt seen a post yet where I think I can add something worthwhile to the debate or Q/A. Maybe in time.

Anyway, I'm looking for some advice about the paperwork & general procedure for buying & taking delivery of a new boat. The Wife & I are in the final stages of buying a new yacht, the old ones gone for part/x & we are expecting delivery in a month or so.

I don't want to say what make or from who, & this may sound silly, but if they're reading this I dont want to jepordise any good will with trust issues.

Now we've already paid a hefty deposit & the balance of around 50K GBP will no doubt be due soon. This is our first brand new boat, & we undertsand that the balance will be due when the boat is complete in the factory on the continent.

So far the level of paperwork we have recieved has been pretty pitiful, & now I have a feeling they are going to expect us to hand over a further 50K & trust that the boat is going to turn up or the manufacturer is'nt going to go bust.

Now it may just be me being an untrustful soul but my nerves are starting to jangle somewhat. I'm sure like most of you, these sums represent a lot of money & hard work to us, & we just want to try & do everything possible to prevent getting our fingers burned.

Does anybody have any advice or know a good source of information regarding this kind of thing? We've heard of the bill of sale, presumably we will get that when give over the money? What about warranties, etc. I still dont think that we've had a proper contract detailing what's warrantied & untill when etc.. Will that come with the boat or are they just statutory.

Is it just me or is there altogether too much trust invloved here. I read the RYA booklet on buying a new yacht, & thought the most sensible point was witholding a percentage of the balance until she's safely on the water & OK, but was then told that just wasn't the done thing.

So what leverage do we have if the boat turns up at the final delivery marina with a great big scratch down the side or something, if it was a washing machine I'd tell them to put it back on the lorry & take it away. My presumtion is that when the boat is put in the slings at the delivery marina she should be perfect, after that if I sink it on the way to the pontoon its down to me.

I think you probably get the jist of what type of finger burning protection advice I'm looking for, and as this post is getting rather long, I'll leave it there.

Thanks for reading. Any help is much appreciated.

Matt

PS. I'm not adverse to being forceful, arsey, or taking my 6ft 1" 15.5st round to the office for a 'chat'. But as I'm sure you'll understand, I seem to think that spending this amount of money on something we really want, they should be falling over themselves to make sure were happy, & hopefully that will be the case. But just in case.

 

[Victor]

Matt
Funnily enough a very similar tale can be told by each boat purchaser. The story is quite familiar to almost every reader who has bought a new boat. The conspiracy of brokers builders the yachting press advertisers et al is still alive and kicking. they will not tell you that the truth is one is not protected at all. you can indeed try to sign a modern Marine federation form of contract if you can find one, and the useless RYA will 'advise' you to do so, but you wont find a broker or builder proffering one. some brokers will offer you a 'bank guarantee' but when you look at who is guaranteeing whom you will not feel too comforted. you can try to rely on your deposit being protected in a secure client account, until you later discover that the account is not set up in accordance with law society rules protocol and that the money can be used for anything, including paying for your boat if you are lucky. The broker and builder will probably share banks so that any security from bonds will only be as good as the individual surety of the company concerned.
so yes you are right to be worried. before you hand over the rest of your money to a broker who is just about to go bust, do a company search on him through Experion or Dunn & Bradstreet or someone, and this will tell you loads about the person you are dealing with and what the banks would be prepared to lend him, which will be a good indicator to you. Then if satisfied, you need to check out the small print of the contract you have signed, 'cause if you decide that things look black you need to establish if you have been deliberately misinformed so that you can legitimately get your deposit back if you wish to. Then the builder itself. If he goes bust just as you hand over the balance of the money, you will be a creditor and the receiver will look after the bank, the taxman, the staff, and guess where you sit in the pecking order?. it is for this reason that very few small British boat builders are still 'afloat'. Who will take the risk with them we ask? No the only thing to do at this stage is to put the money in an independent solicitors account, or take out a separate bank guarantee if you can get one. This is most unlikely. and such guarantees do not usually work in a liquidation situation. my favoured suggestion is that the money sits in a secure independent solicitors account and is paid to the builder once the boat arrives. The builder will not like this as it would affect his cash flow, so you need to agree that you will pay the extra interest that the bank will charge him for the cost of the money to build your boat. he is then not in any worse position than he would be under your existing contract arrangement. if however the bank will not lend him the £60,000 then that will tell you a lot about the foundation of the builder you are dealing with.
my bet is that you will not have any support from the broker or builder at this stage, and that you will be stuck with your existing contract, but it is certainly worth trying. Good luck. If you do what everyone else will do at this years boat show, and just stick your head in the sand, and hope for the best you will probably be Ok IF YOU ARE BUYING FROM THE BIG VOLUME SUPPLIERS that is, eg Beneteau, Jeanneau, Bavaria, Legend, etc. BUT if you are in the small more bespoke type of boat market, then you are probably already in too deep, and extraction could result in losing the deposit. Where is the MBIF and the RYA I ask, and where is the standard form of contract, the standard bond/guarantee, and the proper client account. Us boat purchasers lose our business sanguine when purchasing boats. we get caught up in the dream, and put our head up the backside, so we probably only have ourselves to blame. There are specialist marine lawyers who charge £180/hour to get us mugs out of the mire from time to time, and they have loads of tales to tell. I was roundly told off by one for signing such a ludicrous contract once. Things ended up OK though in the end, but not without many sleepless nights, and spoiled what should have been one of the most exciting and pleasant life events, namely buying a boat. All you would-be purchasers reading this note take care when going to the Southampton Boat Show this week!!!

 

[Andyh]

I don't know who you are buying from, but we recently bought a new Bavaria from Opal. The payments consisted of 10% non refundable deposit, followed by two further payments of 40% each, both of which were paid into a holding account held in joint names of Peters (Opal) and myself. These monies could only be released on the signature of both parties. These monies were released on the delivery of the boat once I'd had the chance to have a good look at it. I then received a certificated showing the boat in joint (proportional) ownership. The final 10% was paid once the boat had been commisioned.
I certainly felt more comfortable with this than simply paying the money into Opals account although with a company of that size, the risk is probably very low.
It might be worth discussing this with your dealer.

 

[tcm]

Good advice below re joint bank accounts and so on. Altho (as u know) you should have arranged who pays what and when and to whom before ordering, the dealer should be able to allay your fears. When opening any discussions of this type, you may well be asked "don't you trust us?", and the correct response to this is "it's not a question of trust - it's a question of clarity!"

But a large number of people do indeed hand over all the loot before the boat is physically presented to them in front of their eyes. I havedone so twice - but the boat did turn up.

Sounds as tho you will be asked for all the loot once the boat is completed in France. In exchange for handing over all the loot, the boat is "yours", so make sure that insurance starts on that date, perhaps including transport, or at least check who is insuring the transportation phase. Check also that a bill of sale exists at that date (faxed to you or the dealer or whatever) also showing that the boat is yours, which you need should anyone go bust.

I can see why the boatbuilders want all the loot on completion at factory. Firstly, specially if they're abroad, it wd be a right pain to try and extract it later. Secondly, at what exact point would you pay, and would you pay all of it? Spose (say) the radar didn't work - would you hold back several thousand quid? It might be a fuse -so that gets fixed but a few days later the rigging jams, so carrying onholding back 10%. Oops...not a fault but a user error, sorry, here's your 10,000 quid. Two weeks later there another fault - now what? You've released the final payment so presumably everything was fine. See? In most cases, much better to have a bit of two-way trust - you pay and they deliver, and they sort the warranty work.

I must say that buying a new boat is a complete dog's dinner compared with buying normal consumer goods. The boat arrives with a truckload of manuals and warranty cards, and the whole industry then behaves as though you ordered a pile of bits,with the manufacturer simply have obligingly screwed things together.

Almost always, delivery will be okay. But after delivery...

1) There will be faults- maybe a scratch or a this or that not working, and so on. You may or may not notice everything at "handover" and it isn't imperative that you do. Write and date a list of faults, and the date on which the faults occurred. Fax the updated list to the dealer at least every fortnight. Make sure that they (and not you) follow the warranty work though the suppliers of the individual components. Some dealers try and get you to follow individual warranty work with individual component suppliers. Don't do this.

2) It pays to get the wife involved and "fronting" the warranty work, signing her name on the list and having her make and take phone calls, if she's ballsy enough. Sexism, of course, but he-man dealers can't resist helping a damsel in distress. And of course, they don't feel as free as they might to suggest a DIY fix - she's a woman!

3) If faults persist or aren't sorted out, get a surveyor to assess the boat before the warranty expires - essentially before end of one year. I did this - best few hundred quid I ever spent. The dealer suddenly realised I meant business, and sorted things out pronto.

I bet that it will be OK.

 

[Guest]

Many thanks to you all for taking the time to reply. Cerainly, some food for thought & ideas I wish I'd known about when we first signed up. In retrospect I do wish we'd been more forceful about getting stuff written down in the beginning, as I'm sure they'd have been more willing then than now they hold 20K of our money as deposit.

I'm not saying there not helpful, In truth we haven't actually spoken to them regarding what happens now. But that was really the purpose of this post, to get some idea what we should be looking for in before we pay over the balance.

Just one more quick question, how long does it usually take to get the boat delivered after balance has been paid. I would have thought about a week max. PS. the boats coming from Germany.

Thanks again, Matt

 

[Victor]

Thought TCM has great ideas post delivery. I will certainly take his advice in getting the boss to deal with the after service department to do the business at the end of the warranty period. Please tell us that the German builder is someone like the substantial company Bavaria. Us correspondents will be less inclined to be too concerned, as they build boats in 3 weeks, and the delivery will be about 2 weeks after you have sent the cheque. If you are dealing with another small very recently resurrected German company the story is complicated. On an open channel one wishes to be careful! Advice is to check out the facts before you pay. The fact is that a company *GMBH was resurrected and registered with a new company number in the spring 2001. The company building the boats is connected to a marketing outfit with has a very glossy front image although the builder stands alone when is it comes to responsibility for delivery. Expiron knows exactly how much the company is worth and how much a creditor should lend it, as does anyone who has done a company search. As purchasers are buying from the more substantial UK broker of the similar name then the direct liability is with them not that outfit in Germany, but they don’t build boats, they rely on the German outfit to enable them to complete the deal. The boats are fantastic of course if one has nerves robust enough to cope with the purchase. Boats were delivered last year, and the company will hopefully go from strength to strength as it builds such good boats, but then again Starlight made fantastic boats, and look what happened late last year. We don’t mean to worry you, but as the deposit is for a substantial amount the next payments are going to be huge, so the idea of insisting a separate account to put the rest of the money into might be prudent. The company should want to complete the deal in any event, and should be willing to find a way to give you some comfort but don’t be surprised if you get the brush off, as they can probably insist on the existing agreement being finalised in it’s current form, so you may just have to hang onto the edge with white knuckles, and hope all goes well. Go and look at the hull though to make absolutely sure that all is well as you pay the stage payments if you are dealing with this small company

 

[tcm]

Yes, the boat should be almost reasy to roll upon payment of balance.

Incidentally, I wd be pleased that the boat is german, not regarding build quality since i don't know who the builder is, but because germans are v v "playfair" about business. In the uk, we're "playfair" about sport (so no cheating with handling the cricket ball, and very bad form to do this or that even with no ref and even amongst kids) whereas anyting goes in business, incl folding the company and so on. Germans are the reverse: they are distraught if you askem about contract details and honour the spirit of everything, but no prob about slightly cheating at sport. imho!