Seller beware!

There is no inconsistency between a simple retention of title clause and an implied, or even express, right of a buyer to sell on the goods before paying the seller. So held the Court of Appeal in giving judgement in Fairfax Gerrard Holdings Ltd and others v Capital Bank Plc (now Bank of Scotland Plc by substitution) on 27 November 2007.

The case concerned the competing interests in an imported printing machine of a specialist trade financier, Fairfax Gerrard Holdings Limited and the financier of the end user, Capital Bank. Fairfax provided the finance to a UK-based supplier for the import of the machine and its onward sale in the UK to Capital Bank's customer. Wragge & Co LLP acted for Capital Bank in this case.

The Court of Appeal found in favour of Capital Bank. It overturned a first instance decision that Fairfax had retained title to the machine by way of a retention of title clause in its finance agreement with the supplier.

Read our analysis to find out more about the judgment.

For an update on the steps you can take, see our action points.