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Companies must get court order to repossess goods paid for 50 percent or more
Proposed Hire Purchase Bill of 2020…
By Rehanna Ramsay
Kaieteur News –The Hire Purchase Bill of 2020 which seeks to safeguard the rights of consumers who buy items on credit has outlined a number of new rules which inter alia, will regulate the repossession or seizure of items.
For one, the Bill proposes that instead of the company or seller being able to repossess items from a purchaser after three months of default in payments, they will now have to obtain a court order to do so. The proposed bill which is before the Parliamentary Select Committee and opens for the 2nd cycle of public consultations places a restriction of company’s seizure of a customer’s items which has paid at least 50 percent of the hire purchase price.
According to the incoming legislation, under the aforementioned circumstances the seller can no longer seize the item unless they obtain order of court to do so. The Bill explains too that once the vendor or company approaches the court for an order, it is up to the court to determine whether to repossess the item, or put in place conditions by which the purchasers pay the balance of the price.
Further in cases where the purchaser is in default payment after remitting less than 50 percent of the hire purchase price, the company or vendor must give the purchaser a notice of 21 days to pay the installment which are in arrears before he gives the notice of termination and possible seizure .
But within the 21 days of the notice, if the buyer pays the outstanding installments, the agreement between the two parties shall remain in force.
The Hire Purchase Bill of 2020 seeks to make provision for the regulation of hire-purchase, credit sale and conditional sale agreements’ and for related purposes.
As previously explained by Minister of Tourism, Industry and Commerce, Oneidge Walrond, the bill was referred to the select committee after some gaps were detected in the consultation process.
Nevertheless, the Minister noted that Hire Purchase Bill is an important piece of legislation that will reform the hire purchase sector.
The legislation she said will provide protection for people who are buying items on credit in the form of hire purchase. Speaking on the Bill, Attorney General, Anil Nandlall SC had explained that “The law says currently, that if you default in any single payment, the owner is entitled to forfeit all the previous payments and repossess the item. That can bring and has brought catastrophic hardship on people,” the Attorney General said.
He pointed out that hire purchase in Guyana is governed by a common law where you pay a sum of money monthly, as rent towards the purchase price. When the final purchase price is paid, the customer then becomes the owner of the item. For example, the Minister said, under the current legislation, if you buy a car on hire purchase and you miss the final payment because of an unforeseen circumstance, the company has the right to repossess the item.
The Bill that will be laid in the National Assembly will offer a number of protections to customers before businesses can exercise their right to forfeit the item. “This Hire Purchase Act will put a stop to that and protect the interest of the hirer because the law as it currently stands, is tremendously harsh and leaves no remedy to a defaulting hirer. This Bill offers some form of protection and when you pass a certain number of payments, the item cannot be repossessed from you,” the Attorney General had underscored.
In the meantime, the landmark Hire Purchase Bill 2020 has been committed to a Special Select Committee of the National Assembly.
The Committee has begun its work but wishes to receive from members of the public, individuals and organizations their views on the Hire-Purchase Bill. The Committee has therefore, extending an invitation to members of the public and organizations to forward written submissions of their views on the Bill no later than Monday, May 30, 2022.
It is advisable that the submission should address specifically those segments of the Bill that are of interest to you or your organization.
Copies of the Bill could be obtained from the Parliament Office, Public Buildings, Brickdam, Georgetown or via the Parliament Offices’ Website: https://www.parliament.gov.gy/…/hire-purchase-bill-2020
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