CONTRACT LAW — Hire Purchase Agreement — Ownership Remains with Seller Until Full Payment
Ratio Decidendi
Per Rhodes-Vivour, JSC, in Ajagbe v. Idowu (2011) NLC-123-271-2003(SC) at pp. 25—26; Paras E—A:
"On the other hand in a hire purchase agreement ownership of the vehicle remains with the seller until payment is fully made. Failure of the buyer/hirer to pay the installments, the owner is at liberty to take possession of the vehicle."
Explanation / Scope
This principle establishes that in a hire purchase agreement, ownership remains with the seller until full payment, and upon default, the owner may repossess the vehicle. The principle applies in hire purchase transactions. It ensures that ownership is retained by the seller. The principle reflects the proprietary nature of hire purchase. It allows repossession on default. The court must recognize the seller’s ownership. The principle provides guidance on ownership in hire purchase.