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HIRE PURCHASE ACT, 2009.

ARRANGEMENT OF SECTIONS.

   Section

PART I
PRELIMINARY.

   1.   Commencement.

   2.   Application.

   3.   Interpretation.

PART II
HIRE PURCHASE AGREEMENTS.

   4.   Execution of hire purchase agreement.

   5.   Requirements relating to hire purchase agreements.

   6.   Interest rate.

   7.   Avoidance of certain provisions in a hire purchase agreement.

   8.   Implied conditions and warranties.

PART III
TERMINATION AND COMPLETION OF HIRE PURCHASE AGREEMENT.

   9.   Termination by hirer.

   10.   Completion of purchase of goods by hirer.

PART IV
RECOVERY OF POSSESSION BY OWNER.

   11.   Owner not to engage in deceptive conduct.

   12.   Communication between the parties.

   13.   Owner not to disclose to third party information in connection with payment or repossession.

   14.   Owner not to charge late charges greater than debt.

   15.   Recovery of possession where two-thirds of price paid.

   16.   Provisions where a suit is instituted.

   17.   Where order for delivery of goods is postponed.

PART V
LICENSING OF HIRE PURCHASE BUSINESS.

   18.   Licensing of hire purchase business.

   19.   Licensing authority.

   20.   Application for a licence.

   21.   Renewal of licence.

   22.   Appeals.

   23.   Display of licence.

PART VI
MISCELLANEOUS.

   24.   Successive agreements between same parties.

   25.   Owner to account for proceeds of sale.

   26.   Hirer's refusal to surrender goods not conversion.

   27.   Hirer may require information.

   28.   Appropriation of payment where more than one agreement exists.

   29.   Limitation of enforcement of agreement.

   30.   Insolvency of owner.

   31.   Insolvency of hirer.

   32.   Service of notice.

   33.   False information.

   34.   Transfer of interest in hired goods.

   35.   Penalty for hirer taking hired goods out of Uganda without consent of owner.

   36.   Regulations.

   37.   Power of Minister to amend Schedule.

   38.   Persons carrying on hire purchase business before commencement of Act.

 

      Schedule   Currency point.

 

HIRE PURCHASE ACT, 2009.

Commencement: 12 June, 2009.

   An Act to provide for the regulation and registration of hire purchase agreements and the licensing of persons carrying on hire purchase business and for related purposes.

 

PART I
PRELIMINARY.

 

1.   Commencement.

   This Act shall come into force on a date appointed by the Minister by statutory instrument.

 

2.   Application.

   This Act applies to hire purchase agreements entered into after the coming into force of this Act.

 

3.   Interpretation.

   (1) In this Act, except where the context otherwise requires—

   "bailment" means a delivery of goods or movable personal property by one person to another in trust for the execution of a special object upon or in relation to goods beneficial either to the bailor or bailee or both and upon a contract, express or implied, to perform the trust and carry out the object and either redeliver the goods to the bailor or dispose of the goods in conformity with the purpose of the trust;

   "cash price" means the price at which a creditor would have sold the goods to the buyer for cash on the date of the hire purchase agreement;

   "contract of guarantee", in relation to a hire purchase agreement, means a written contract, made at the express or implied request of the hirer, to guarantee the performance of the hirer's obligations under the hire purchase agreement, and "guarantor" shall be construed accordingly;

   "currency point" has the meaning assigned to it in the Schedule;

   "delivery" means voluntary transfer of possession from one person to another;

   "goods" includes all chattels, personal, other than things in action and money and all emblements, industrial growing crops and things attached to or forming part of land which are agreed to be severed before sale or under the contract of sale;

   "guarantor" means a person who agrees to perform the hirer's obligations in case the hirer defaults under a hire purchase agreement;

   "hire purchase agreement" means an agreement for the bailment of goods under which the bailee may buy the goods or under which the property in the goods will or may pass to the hirer;

   "hire purchase business" means a business of entering into hire purchase agreements;

   "hire purchase price" means the total sum payable by the hirer under a hire purchase agreement in order to complete the purchase of goods to which the agreement relates, including the cash price, interest, financial charges, and a deposit or other initial payment;

   "hirer" means the person who takes goods from an owner under a hire purchase agreement and includes a person to whom the hirer's rights or liabilities under the agreement have passed by assignment or operation of law;

   "interest" means prime lending rate of interest set by the Central Bank;

   "licence" means a licence issued to carry on hire purchase business under this Act;

   "licensed person" means a person licensed under Part V to carry on hire purchase business, and includes a company to which the owner's property in the goods or any of the owner's rights or liabilities under the agreement has passed by assignment or by operation of law;

   "Minister" means the Minister responsible for trade;

   "owner" means the person who hires goods to a hirer under a hire purchase agreement, and includes a person to whom the owner's property in the goods or any of the owner's rights or liabilities under the agreement has passed by assignment or operation of law;

   "satisfactory quality" means the state and condition of goods; and the following, among others, are aspects of the quality of goods—

   (a)   fitness for all the purposes for which the goods of the kind in question are commonly supplied;

   (b)   appearance and finish;

   (c)   safety; and

   (d)   durability;

   "warranty" means an agreement with reference to goods which are the subject of a hire purchase agreement, but collateral to the main purpose of the agreement, the breach of which gives a right to a claim for damages, but not to a right to reject the goods and treat the agreement as repudiated.

   (2) Where by virtue of two or more agreements none of which by itself constitutes a hire purchase agreement there is a bailment of goods and either the bailee may buy the goods or the property in them will or may pass to the bailee, the agreements shall be treated for the purposes of this Act as a single agreement made at the time when the last of those agreements is made.

   (3) A reference in this Act to taking possession of goods hired under a hire purchase agreement does not include a reference to the owner taking possession as a result of the hirer voluntarily returning the goods, but includes a reference to the owner taking possession under the authority of an order of a court, and a return of goods after a notice has been served on the hirer under this Act.

 

PART II
HIRE PURCHASE AGREEMENTS.

 

4.   Execution of hire purchase agreement.

   (1) A hire purchase agreement shall be executed in writing by the owner and hirer.

   (2) A contract of guarantee relating to a hire purchase agreement shall be executed by a guarantor.

   (3) Where a contract of guarantee relating to a hire purchase agreement is not executed by a guarantor as required by subsection (2), the agreement is voidable at the instance of the owner.

   (4) Before a hire purchase agreement is executed, the owner and the hirer shall make full disclosure of all the information relevant to the proposed agreement.

   (5) A person who—

   (a)   fails without reasonable cause to give the information referred to in subsection (4); or

   (b)   gives information which is false in any material particular, and which he or she knows to be false or does not believe to be true,

commits an offence and is liable on conviction to a fine not exceeding 100 currency points or imprisonment not exceeding one year or both.

 

5.   Requirements relating to hire purchase agreements.

   (1) Before a hire purchase agreement is entered into in respect of any goods, the owner shall state in writing, in the prescribed form, to the prospective hirer, the cash price of the goods.

   (2) Subsection (1) shall be taken to be sufficiently complied with, if—

   (a)   the hirer has inspected the goods or similar goods, and at the time of his or her inspection, tickets or labels were attached to or displayed with the goods, which clearly stated the cash price, either of the goods as a whole or of

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