What's material in a boat survey?

[Gludy]

What\'s material in a boat survey?

When purchasing a boat, the standard contract ref surveys state that youy may only pull out in the case of 'material defect'. I think I understand this and although its defintion, in case of dispute, would be up to a court - my question is really about all the other defects that are not material.

All the little things that do not wor eg one windscreen wiper, a switch, a can all add up to a tidy sum to have put right.

So do you individually check everything yourself before signing up or are any things not working put right from the surbey list, even though they may not be material?




Paul

 

[jfm]

Re: What\'s material in a boat survey?

As you say, judgemental. Bust windscreen wiper is not material, but hull moisture or crack probly is. AFAIK there is no definition. The concept of material is widely used in contracts and there's a kind of gudeline that legal people sometimes quote, which is 5%. You cannot use this every time, but if a bust item has a repair cost >5% of purchase price, I would say that is material. However, this rule is not foolproof. A 1" dia hole below the waterline is also material imho even if it only costs £500 to glassfibre fix it....

 

[Gludy]

Re: What\'s material in a boat survey?

So all the non-material problems, which can add up to a few thousand pounds worth of putting right are not fixed and the purchaser has to put them right at their own expense - right?

If that is the case, then it surely pays to check out every switch, catch, piece of eqiuipment before paying a deposit - yes?

Paul

 

[jfm]

contract wording again

No, this depends on wording. Ie does it say "puchaser can walk away if there is any problem which is material". Or does it say "puchaser can walk away if there are any problems which individually or taken together/in aggregate are material"

Again, get your pen out and make sure it says the latter!

 

[ccscott49]

Re: contract wording again

You mean if theres a tear in the material of the sofa, in the saloon, the sales off?

 

[Gludy]

Re: contract wording again

I think you are missing my point a bit.

It would be unreasonable of the buyer to walk away for non-material defects - I accept that.

What I am saying is .. by example...

Found not working:-
Lights to one cabon - could be electrics.

2 screewipers

1 screen washer

1 wahing machine (when it cannot be easily replaced as it was built into the boat!

So say £5k worth of things not working but all not material to the sale... then who faces the bill for fixing them - the buyer as I see it.

Therefore it is up to the buyer to check verything is working before agreeing to purchase subject to survey because there can be many things not right which added together are significant which are not materail faults.

As it happens as far as sea trails go I am not spoilt for choice. In this country there are very few 52 to 60 footers suitable foot boats for sale - most are in the Med.

On a particular boat I am thinking of holding things back a bit whilst I actually check out for myself what is working and what is not working before signing and depositing.

My first boat was simple - private sale -willing seller - had sea trail to make decision - decided - bought it - all in a matter of weeks.

So to come back to my point - my question on the non-material points is not about walking away - I would not want to - its about getting the seller to pay for things that do not work but individually in themselves are not material.



Paul

 

[c_j]

Re: contract wording again

Gludy, If its subject to survey you can pull out if its material but in any case the seller fixes all the problems found in the survey. Why do you say it makes sense to look out for all the problems yourself first? It makes little sense (except I suppose you get to know how well looked after the boat was, and if the surveyor misses them) The deal is (normally) any faults found by surveyor seller pays to hve fixed or a sum is deducted from the prurchase price to reflect cost of rectifying faults. Thas what subject to survey means.

My current situation is different to this but as it is nearly over I will give more detail later.

CJ
chris@stone.uk.com

www.stone.uk.com

 

[Gludy]

Re: contract wording again

What I was trying to establish was if the seller fixes all the faults found in the survey regardless of them being material or not. If they do, no problem.

A typical defects clause is here:_
"Within 7 days after completion of such examination and/or Survey if any material defect or defects in the VESSEL, other than those disclosed in writing prior to the signing of this Agreement, shall have been found, the BUYER may either;
a) Give notice to the BROKER rejecting the VESSEL, in writing, specifying the material defect/defects.
b) Give notice to the BROKER, specifying the material defect/defects, and requiring the VENDOR to make right the same, or make a sufficient reduction in the Purchase Price to cover the cost of making good said defect/defects.
In the event of the BUYER serving notice under Clause 4a with reasonable cause, or under Clause 4b with reasonable cause and the VENDOR failing to agree to a reduction in Price, or the Parties failing to agree to a fair reduction within 14 days from receipt of written notice, then the BROKER is authorised to return the DEPOSIT and rescind this Agreement under the terms of Clause 7."

The clause only makes reference to materail defects, I see no mention of putting all defects right. I thought 'subject to survey' referred to the fact that the deal was off if material defects were dicovered. I hope you see why I am confused on this.




Paul

 

[ChrisP]

Re: What\'s material in a boat survey?

I think the term "material defect" is open to the discretion of the reader. I know a bloke who had an insurance claim rejected because he hadn't painted the battery charger, a job mentioned in the survey. The threat of a £50,000 damages claim in the high court revised the insurance company's opinion.

ChrisP

What do you mean the sea gull in front's walking !!!

 

[Gludy]

Re: What\'s material in a boat survey?

I agree that' material defect; is a value judgement - but my point is not about material defects it about non-material defects - it seems that the standard clause does not cover the fixing of anything other than material defects. Some seem to think that all listed faults are fixed - but, to me, it seems that the standard contract only covers material faults.



Paul

 

[jfm]

non materail defects, and also deposit returns

Gludy:
Sorry, didn't get your point first time round.

The clause you quote seems to be from the standard ABYA contract (except, see last para below) as it looks the same as one I dealt with 2 months ago from a ABYA broker.

Your suspicion is correct imho. Non material defects are not covered. In other words, if there is a non material defect, you cannot reduce the price nor insist the vendor fixes it nor walk away. I think the logic of this is that caveat emptor should apply. You are buying a secondhand boat and you should find non materail defects yourself. If they really are immaterial, you shouldnt care. If they do matter to you, you are free to hire a surveyor and ask him to identify with reasonable diligence all non materail defects. But the whole point about non material is that they dont really matter. And to be fair, you cannot expect vendor to take all risks, it is only reasonable that purchaser should generally take some risk in buying a second hand boat, imho.

A totally separate point, but I didn't like the words "the BROKER is authorised to return the DEPOSIT and rescind this Agreement ..." AFAIK this is not standard ABYA. The standard I think, which is much better, is ".....then this Agreement shall be rescinded and any deposit paid shall be refunded in accordance with Clause X hereof". In other words you want them compelled to return your deposit, not merely authorised to!

 

[airbubble]

Re: What\'s material in a boat survey?

In short, a material defect is a defect that prohibits the normal and safe use of the vessel, or will do so v shortly.
In my book, a broken windscreen wiper therefore is listed as a service defect , broken or worn engine mount is a structural defect. (though i must say that interpretations of this do vary here on the continent from some UK ideas) Also remember that everything that can be clearly seen or established when a potential buyer first sets foot on a vessel is looked at as known to the prospective buyer and may be expected to be taken already into account on making the offer, so can never be renegotiated as a structural defect afterwards under the 5% clause. (eg a badly worn teak deck, or again the broken windscreen wiper)
The 5 % (or similar) rule for repair costs of the listed structural defects only gives a a cut-off definition of the agreement. Has nothing to do with the number of defects, also the defects do not become structural if all together add up over this 5% clause.

 

[Gludy]

Re: non materail defects, and also deposit returns

Once again thank you for your help - I had already queried the broker being authorised bit because it seemed strange to me.

I can aimagine there are a number of things that are not materail but could add up to a lot of money - eg an air conditioning unit, a washing machine that had the boat built around it etc.

Basically then, The net result of all this is that it is up to the buyer to beware and to check over most obvious things themselves - at least enough for them to be happy with all the surface things. - before signing up!

I think that is fair enough - buyer beware!


Paul