Syndicate purchase question

[KenMcCulloch]

I'm in a syndicate which is probably on the point of buying a boat, a private sale without a broker involved. We are looking at the paperwork templates provided by the RYA and have come across a small dilemma. The syndicate agreement itself is all fine, we are working towards a suitable version.

The problem is in relation to the form that the Bill of Sale should take. The RYA template provides spaces for transferees' signatures as well as for the signatures of transferrors. In our case the seller is an individual so only one of him. When I have bought and sold boats as an individual it has always only been the seller or transferror whose (witnessed) signature appears on the Bill of Sale. Our names as new co-owners obviously need to be there but I'm not sure why our signatures would be needed.

Can anyone who knows about this stuff advise?

 

[jonic]

I'm in a syndicate which is probably on the point of buying a boat, a private sale without a broker involved. We are looking at the paperwork templates provided by the RYA and have come across a small dilemma. The syndicate agreement itself is all fine, we are working towards a suitable version.

The problem is in relation to the form that the Bill of Sale should take. The RYA template provides spaces for transferees' signatures as well as for the signatures of transferrors. In our case the seller is an individual so only one of him. When I have bought and sold boats as an individual it has always only been the seller or transferror whose (witnessed) signature appears on the Bill of Sale. Our names as new co-owners obviously need to be there but I'm not sure why our signatures would be needed.

Can anyone who knows about this stuff advise?

I haven't used an RYA Bill of Sale for ages, but the current version I have does not require signatures of the transferee's (purchasers).

Are you referring to the syndicate form?

 

[KenMcCulloch]

I haven't used an RYA Bill of Sale for ages, but the current version I have does not require signatures of the transferee's (purchasers).

Are you referring to the syndicate form?

Thanks, I was hoping you might be around! Yes we are looking at the RYA Syndicate Bill of Sale Form. I can't understand why the buyers, named on the document, need to sign it as opposed to the seller(s) who obviously must sign.

 

[fireball]

Strange - I would've thought both would have to sign ... Otherwise a "seller" could just pass ownership (and liability) of a vessel onto a third party without their knowledge?!

 

[davidej]

Strange - I would've thought both would have to sign ... Otherwise a "seller" could just pass ownership (and liability) of a vessel onto a third party without their knowledge?!

This seems to be a non sequiter.

How could a person escape liability for an object by purporting to sell it to someone who didn't know or agree that he had 'bought' it. Sounds more like fraud to me.

 

[fireball]

This seems to be a non sequiter.

How could a person escape liability for an object by purporting to sell it to someone who didn't know or agree that he had 'bought' it. Sounds more like fraud to me.

Yes - exactly ... fraud ...

Receipts/Orders/Bills of Sale are quite often required for higher value goods as proof of transfer of ownership from one party to another - I'm quite surprised that boats are leaving this category ....

 

[mjcoon]

How could a person escape liability for an object by purporting to sell it to someone who didn't know or agree that he had 'bought' it. Sounds more like fraud to me.

Yes, but a form should be designed to make that clear by having a field which would be empty (or forged) in such a case. Else why have a form?

Mike.

 

[awol]

.... and what about proof of VAT paid?

 

[Tranona]

.... and what about proof of VAT paid?

That is nothing to do with the BoS except that the seller is stating the goods are free, which would cover any potential VAT liability. The purchaser would however want to see if possible evidence that this is true. If the transaction is between private individuals as this one is, there is no VAT involved - so the evidence (for what it is worth) would be in the form of a receipt related to the last transaction that was a "chargeable event" - in practice usually the sale from the builder or dealer to a private owner. It could also be from a VAT registered owner to a private buyer or a direct payment to HMRC by a private importer. Many older boats do not have such paperwork because either they are exempt from providing proof, largely because of age, but also location, or more annoyingly the transaction occurred before it was considered useful to keep such a document.

 

[fireball]

That is nothing to do with the BoS except that the seller is stating the goods are free, which would cover any potential VAT liability.

But it also shows that the transaction is between two private individuals/groups rather than to/from a vat registered entity ...

 

[Racecruiser]

I am in dual ownership on our Elan 295 and we bought through Boatshed Essex (very good by the way we thought) so not the same as your circumstances.

On the Bill of Sale the transferors were husband and wife (signed as joint owners) and we were the transferees (as joint owners, no space or need for our signatures as we had already signed the Agreement for Sale and Purchase). I imagine a private Bill of Sale could/should reflect the same position which I think is what the OP is probably saying.

Incidentally a third of our lovely Elan 295 is for sale to a like-minded party - see JOG website 'for sale' section for full details ....

 

[ianat182]

If I recall when MCA Part 1 registering our boat under a joint ownership with the MCA there was a requirement for the division of ownership into 64ths, and at least one of us(the boat 'manager' % had to be greater than the other partner; When insuring the boat and declaring ownership details I declared as this percentage.
I do remember that my partner did sign the Bill of Sale (on the back of the form).
I am also the manager for our mooring licence on the Hamble,they do not recognise my partner in this regard, which is possibly a problem for him unless he keeps his name on the waiting list for a mooring... in the event of clogs popping!

ianat182

 

[jonic]

Ken can you pm me a link to the form and I'll have a look for you.

 

[jwilson]

I'm in a syndicate which is probably on the point of buying a boat, a private sale without a broker involved. We are looking at the paperwork templates provided by the RYA and have come across a small dilemma. The syndicate agreement itself is all fine, we are working towards a suitable version.

The problem is in relation to the form that the Bill of Sale should take. The RYA template provides spaces for transferees' signatures as well as for the signatures of transferrors. In our case the seller is an individual so only one of him. When I have bought and sold boats as an individual it has always only been the seller or transferror whose (witnessed) signature appears on the Bill of Sale. Our names as new co-owners obviously need to be there but I'm not sure why our signatures would be needed.

Can anyone who knows about this stuff advise?

If the boat is Part I registered you MUST use the MCA form MSF4705, and divide the shares in 1/64ths. With more than two new owners you do a separate BOS for each new owner - eg eight 8/64ths bills of sale. Sometimes one part-owner has to have a share more or less than the others to make this work.

If unregistered or on part III (SSR) you could use the RYA form, but it is not really laid out to make multiple new owners easy. Better to still use MSF4705 as above, but you could if you wish divide shares in simple parts - eg 1/7th each, which is impossible in 64ths.

Whatever form you use only the transferor (seller) signs.

 

[jfm]

The RYA synidate "BoS" is terrible imho. It doesn't know what it is. It starts off trying to be an instrument that conveys title to the boat, just as an MCA BoS conveys title to shares in a Part 1 boat or a TR1 transfers title to land in England and Wales. So far as that goes, the document is fine

But then it loses its way. It tries, in part but certainly not in whole, and in a "I'm a bit lost" kind of way to become an agreement to sell a boat and to hold it in a syndicate. For example, it contains an undertaking given by the transferees (which is not something any good lawyer would put in a BoS) in the sentence "The Transferee(s) hereby agree to hold the Boat as legal [co-owners in the shares set out above]" and of course for that undertaking to be enforeceable it MUST then be signed by the transferees. Hence, the inclusion hamfistedly of that undertaking is the reason why it requires buyer signatures.

But you'd be much better off not having such an undertaking in this document. For a start, who is the undertaking given to? To the seller? Just to the other syndicate members? It doesn't say! Those undertakings belong in the syndicate agreement, and nowhere else. You most certianly do not want two different documents, this one and the syndicate agreement, trying to contain the same undertaking to hold the boat is a syndicate, but doing it differently. In the case of inconsistency, which there will be knowing the RYA, which prevails? So scrub it out of this document

Here's another example. It says "The Transferors For themselves and their heirs covenant with the Transferee..." What on earth is all that about? Do they seriously believe in the RYA that a person can covenant on behalf of whomever he might write into his will as his heirs? That's just absurd. I repeat, this is a very poor document and if you use it you do so at your peril. Much better to get the seller to use the MCA document, or deelte all the buyer signature and undertakings, or simply to insert into the purchase agreement that transfer of title will occur by physical delivery of the vesseel at a stated time and place (works perfectly well for a £100k car, so why not a boat?)

You gotta remeber that just cos something is drawn up by a lawyer doesn't make it right. There are sharp lawyers and not-so-sharp ones. The RYA lawyers are not the sharpest in the land and this is a lousy document. I have owned 3 boats in syndicate in the past and I never used this document, deliberately, and never would. You will get much better legal advice on this forum than from the RYA, by the way.

 

[Clyde_Wanderer]

Thanks, I was hoping you might be around! Yes we are looking at the RYA Syndicate Bill of Sale Form. I can't understand why the buyers, named on the document, need to sign it as opposed to the seller(s) who obviously must sign.

Would have thought that without a signiture from all interested parties/individuals there would not be a contract formed.
C_W

 

[jonic]

Usually the contract is formed at the sale and purchase contract stage. Each party performs as per that contract with regard to survey, deposit and then the balance payment. The purchaser accepts the yacht as per the contract, and transfers the funds. The Bill of Sale is then an instrument with which to convey title after the contract.

This is why the MCA Bill of Sale is only signed by the seller.

 

[armchairsailor]

Without wishing to set the cat among the pigeons, how does it stack up under Scots Law: I assume the boat is in Scotland, Ken?

Possibly having a chat with the owner of Whippersnapper might be useful - he is/was a conveyancing lawyer.

 

[KenMcCulloch]

It tries, in part but certainly not in whole, and in a "I'm a bit lost" kind of way to become an agreement to sell a boat and to hold it in a syndicate.

Thanks, that's helpful, those were pretty much the issues I was concerned about myself. If we have a syndicate agreement (we do or will have by next week) why do we need to have this stuff in the Bill of Sale as well? Absurd, as you say.
Cheers

 

[jonic]

Ken

I got your PM. I'm a member so could access the link.

From what I can see it is a catch all form. It is acting as a bill of sale and setting out the syndicate share holding at the same time.

It states in the notes only for SSR or Unregistered vessels and not for use if any parties are a corporate body or if the vessel is part 1 registered.

The transferees are signing to agree to this clause:

The Transferee(s) hereby agree to hold the Boat as legal [co-owners in the shares set out above] [joint owners] [delete as necessary].

Are you having a sale and purchase contract prior to purchase?