Action by ROT suppliers: effective enforcement of your claim

A supplier wishing to assert a claim to reservation or retention of title (ROT) of stock it has supplied may be faced with a real predicament on learning that a customer has gone into administration. Imagine that in the run-up to administration a supplier has problems finding someone to speak to regarding the claim. Fraught conversations with the customer’s management come to an end. The customer’s directors are told by the proposed administrators not to make concessions to suppliers or to allow stock to be handed back. The administrator’s appointment then takes effect, but by the time the supplier is fully in the picture, a sale of the business and its assets may have already taken place, leaving a new company is in possession of the supplier’s stock.

The supplier may at some stage receive a questionnaire asking for details of any ROT claim the supplier may have. However, the supplier may also be told that the administrator has reached agreement with the new owner of the business, leaving the new owner responsible for dealing with suppliers’ claims and that the supplier should contact them direct…

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