Selling a Pt III registered vessel

[Benny257]

Hello all,

I've sold several dinghies in the past, but am selling my first SSR Pt 3 registered boat soon. I'm happy with the Ofcom and SSR stuff (both offices were quite helpful)

I'm not sure what to do with the MCA form 4705 'Bill of Sale'. Is this a legal requirement ? And what do I do with the completed form ? And why does the 4705 (from my purchase of the boat) show that I paid '£1 and other considerations'? Previous transactions on the boat read similarly.

All help much appreciated.

 

[LittleSister]

I'm no lawyer, but I'm pretty confident of the following, having been through the hoops a few times.

MCA Form 4705 is not a legal requirement for a SSR registered boat. A bill of sale is just a formal record of the sale of a vessel, but for an SSR registered boat it doesn't need to be on the MCA (or any other) form.

The law doesn't require you to have, or provide, any bill of sale at all for an SSR registered vessel, but it's highly desirable for the purchaser to have a bill of sale as some evidence (though it isn't a guarantee at all) that they own the vessel, particularly once they come to sell it again. (Ideally, a boat will have a complete chain of bills of sale, showing the boat's entire series of owners back to the original purchase from the builder.)

You could use the MCA form to record your sale, but it's unnecessarily complicated for your situation. The RYA has a bill of sale template that is probably more appropriate for your purposes (there are others, or you could write your own). You can download one here - https://www.rya.org.uk/sitecollectiondocuments/legal/Web Documents/Legal Leaflets/Members Advice/Bill of Sale/BILL OF SALE.pdf You give the completed form to the new owner (though you might want to keep a copy).

The '£1 and other considerations' is just a means of getting around revealing what you paid (or received) for the vessel while ensuring a legally sound change of ownership has occurred. In order to form a valid contract you must have exchanged something for something - it can't be something for nothing. So even if someone offers you a boat for free, it's worth giving them a pound (or a peppercorn, but you're less likely to have one in your pocket!) to make the handover a legally valid and binding contract they can't then change their mind about later. (There are other means of recording a gift of a boat, but they are unnecessarily complicated for, say, just giving away a boat of negligible value.)

Normally you would record the price you actually pay for the boat in the bill of sale, but some people are a bit shy about revealing the amount involved, for various reasons good and bad. So if you sell a boat for, say, £10,000, you would be lying if you said you'd sold it for '£1', but if you said you'd sold it for '£1 and other considerations' you would not be.

The '£1 and other considerations' could also be used in the case of sale paid for by unvalued or non-monetary considerations, e.g. I'll give you my boat for 'free', in exchange for your car, or letting me use your ski chalet every Christmas. The £1 seals the deal, and you acknowledge there's more to it than that but without having to specify the exact value or terms of the rest (a week or fortnight every Christmas?, when will the arrangement cease? etc.) in the bill of sale itself. (A side agreement about such arrangements might be appropriate in some circumstances.)

On the other hand, not recording the full amount in the bill of sale might perhaps raise suspicions of money laundering, tax evasion, or legal complications etc., if large sums were involved. (Sadly, I've never had to worry about large sums of money!)

I hope that helps. (I'm happy to be corrected by anyone more knowledgeable.)

 

[Kukri]

I agree with what Little Sister has written in the post above.

 

[Benny257]

Thank you Little Sister - very comprehensive and sort of re-inforced what i was thinking, but good to hear it from someone who's done it a few times. Cheers.