Contract hire
| Contract hire |
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| See also |
Contract hire is a monthly contract for renting a vehicle or a plant, which covers everything but insurance, fuel and operator[1].
This kind of contracts are provided by contract hire companies specialised in renting who agree to rent a vehicle or a plant for period that is not necessarily the life of the vehicle or plant[2].
Contract hire agreements are much simpler than contracts at a fixed price, because the commitment and responsibility of the supplier is smaller. Cases such as late payment, acceptance tests and many others simply do not appear. However, account should be taken of the intellectual property rights arising from the work[3].
Diferrence between contract of hire and sales of goods
Contract of hire is fairly well easy to distinguish from the sales of goods[4]:
- Because the parties never predict that ownership will be transferred from the owner to the hirer.
- A contract of hire is an agreement whereby one person gives the right to possess without ownership of the goods to another person in return for payment.
- Payment can be periodic as in the case when the owner of the house hires the TV or can be one-time, as in many cases car rental.
„Hire contracts may be called rental agreements, leasing agreements, contract hire, etc. but legally they are all the same”[5].
Contract hire of vehicles
Contract hire of vehicles has become a very attractive option. It may differ from the delivery of the vehicle itself, through maintenance, drivers, insurance, etc. to the condition of the complete distribution conflicts. Therefore, there has been a rapid development of external distribution companies offering a variety of services. The financial benefits of contract hire include the release of capital and the easier and more predictable costs of operations[6].
Contract hire commonly used in the supply of car fleets company. The lessor bears some responsibility for the management and maintenance of the assets at an agreed level. However, fleet management goes beyond normal contract hire and includes constituents such as accident management so that altogether related to the vehicle is outsourced to the hirer[7].
Body shopping
Contract hire is sometimes dismissively referred to as „body shopping ". Independent contracts are closely linked, whereby individuals sell their own services to customers on a similar basis to a contract hire[8].
References
- Agrawal V., Ferguson M., Toktay L, Thomas V. (2011), Is leasing greener than selling?, Management Science manuscript MS-09-00479.R2
- Bott F., Coleman A., Eaton J, Rowland D. (2000), Professional Issues in Software Engineering, CRC Press, p.113
- Buchan R., Felming E., G. Fiona (2012), Estimating for Builders and Surveyors, Routledge, p.45
- Owens (2001), Law for Non-Law Students , Cavendish Publishing, p.347
- Rouse C. (2002), Bankers' Lending Techniques, Global Professionals, p.285
- Rushton A., Oxley J., Croucher P. (2000), The Handbook of Logistics and Distribution, Institute of Logistics and Transport, Kogan Page Publishers, p.383
Footnotes
- ↑ Estimating for Builders and Surveyors p.45
- ↑ Estimating for Builders and Surveyors p.45
- ↑ Professional Issues in Software Engineering p.113
- ↑ Law for Non-Law Students p.347
- ↑ Law for Non-Law Students p.347
- ↑ The Handbook of Logistics and Distribution' p.383
- ↑ Bankers' Lending Techniques p.285
- ↑ Professional Issues in Software Engineering p.113
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Author: Maciej Michałek
