Bills Of Sale: Past, Present And Future

Background

The Bills of Sale Act (the "Act") was introduced in 1878 and still governs how individuals, partnerships and unincorporated bodies can use goods that they own as security for loans, while retaining possession of those goods. Since 1882 the legislation has hardly changed and as such the Act is seen as somewhat outdated. According to the Law Commission, however, despite the legislation's origins in the Victorian era, the use of bills of sale has increased rather dramatically in recent years: a report from this year cites growth of 3,000 bills of sale registered with the High Court in 2001 to over 30,000 in 2016.

How does a bill of sale work?

Also known as a 'logbook loan', a bill of sale operates whereby the borrower gives the lender a bill of sale on their goods or vehicle. The borrower is able to continue their use of the goods or vehicle so long as repayments are kept up, but, as with...