Sch 2 s 53Guarantee as to undisclosed securities etc.

53 Guarantee as to undisclosed securities etc.

(1) If:

(a) a person (the supplier) supplies goods to a consumer; and

(b) the supply is not a supply of limited title;

there is a guarantee that:

(c) the goods are free from any security, charge or encumbrance:

(i) that was not disclosed to the consumer, in writing, before the consumer agreed to the supply; or

(ii) that was not created by or with the express consent of the consumer; and

(d) the goods will remain free from such a security, charge or encumbrance until the time when the property in the goods passes to the consumer.

(2) A supplier does not fail to comply with the guarantee only because of the existence of a floating charge over the supplier’s assets unless and until the charge becomes fixed and enforceable by the person to whom the charge is given.

Note: Section 339 of the Personal Property Securities Act 2009 affects the meaning of the references in this subsection to a floating charge and a fixed charge.

(3) If:

(a) a person (the supplier) supplies goods to a consumer; and

(b) the supply is a supply of limited title;

there is a guarantee that all securities, charges or encumbrances known to the supplier, and not known to the consumer, were disclosed to the consumer before the consumer agreed to the supply.

(4) This section does not apply if the supply is a supply by way of hire or lease.