A “disposition” of goods for the purposes of section 29(1) of the Hire-Purchase Act 1964 was limited to a transaction where the goods had been transferred for money.

Judge Mackie QC, sitting as a judge of the Queen’s Bench Division, so held in allowing an application for summary judgment by the claimant, VFS Financial Services Ltd , against the defendant, JF Plant Tyres Ltd, in respect of its claim for repossession of a vehicle which had been acquired by the defendant in lieu of a debt.

The claimant let a vehicle on hire purchase terms to a company. The claimant terminated the agreement for non-payment of instalments and sought to repossess the vehicle. The company had, however, given possession of the vehicle to the defendant in settlement of a debt owed to the defendant. The defendant refused to return the vehicle to the claimant, asserting that the defendant had title to it and was entitled to the protection of section 27 of the Hire Purchase Act 1964 as an innocent purchaser without notice of the hire-purchase agreement between the claimant and the company. The claimant contended that there had not been a “disposition” of the vehicle, as defined by section 29(1) of the 1964 Act because taking property in lieu of a debt did not amount to a sale or contract for sale and could not constitute a disposition or purported disposition.

JUDGE MACKIE QC said that “disposition” was limited to a specific transaction where the vehicle was transferred in return for money. That there was no need to stretch the definition to cover less conventional transactions. Accordingly, the claimant was entitled to summary judgment.